China is playing a growing role in global vegetable trade

AgExporter, Feb, 2003 by Elizabeth Mello

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For details, see FAS Report "China's Growing Role in Agricultural Trade." To find it on the Web, start at www.fas.usda.gov/htp/circlst.html and scroll down to International Trade Reports.

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1. Chinese buyer contacts U.S. supplier, and sets terms (price, quality, etc.) for transaction.

2. U.S. exporter obtains phytosanitary certificate and sends it to Chinese importer.

3. Chinese buyer contacts Chinese importer to arrange import of product.

4. Buyer transfers 50 percent of transaction cost to importer.

5. Importer opens letter of credit payable to U.S. exporter upon shipment.

6 Buyer submits phytosanitary certificate to importer to give to quarantine officials during customs clearance. (Monetary conversions handled by importer.)

7. U.S. exporter ships product, collects 50 percent of payment. Exporter sends packing list to Chinese buyer or importer.

8. Importer receives cargo, handles customs clearance.

9. Buyer pays importer's service fees and customs fees and duties.

10. Buyer inspects product. If there are no problems, buyer pays remaining 50 percent to importer.

11. Importer pays exporter.

12. Buyer claims product and arranges transport by truck in reefer containers to buyer's cold storage facilities.

13. Product is sold to distributors. Direct sale to retailers is impractical, as most retailers buy imported products only in small quantities.

The author is a marketing specialist with FAS' Horticultural and Tropical Products Division. Tel.: (202) 720-9903; Fax: (202) 690-3346; E-mail: Elizabeth.Mello@usda.gov