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Generation by generation, China moves ahead

By Ken Root

Editor's note: Ken is in China this week. He is traveling as a reporter with a trade delegation from the Iowa Soybean Association. This is his third time to visit China. Previous trips were in 1981 and 2008.

The work week began in the North Central city of Xi'an (Shee' an) with traffic reaching to the horizon. Cars, buses and motor-powered conveyances of all types began the daily trek into the metropolis of eight million to work at their jobs in factories and businesses. This city (that most Americans have never heard about) is the size of Chicago and expecting rapid growth in the future. It is projected to be one of the 15 "megalopolises" of the country. The proximity of the "Terra Cotta Warriors" and the cultural history of this place is expected to bring many tourists from inside and outside of China. The infrastructure that is being built for local growth and international tourism is colossal.

We are, luckily, driving the opposite direction of the traffic as we head out of the city to a soybean crushing plant owned by Jilin Grain Group and their four companies that import, process and sell soybean products. Speed limits and lanes are "suggested" in China. The drivers move left and right to get into the narrowest slot that permits them to go faster than those around them. It is an extension of the culture of crowding with quiet people showing aggressive behavior as they move from place to place.

We drive by wheat fields that are dark green and showing signs of spring in an otherwise brown landscape. The locals tell us it is dry and will get hot this summer. We can see that everything (including the air) needs a rain to settle the dust and bring springtime into full flower. The combination of coal-fired electrical plants and drought makes the sky a hazy brown with the sunlight filtered and gauzy. Face masks are not an uncommon sight.

A beautiful sign at the entrance of the soybean facility says: "Shiyang Group Xi An Banqqi Oil & Fat Co., LTD." The gate is guarded gently so we slide through and out of the bus, about a half hour early. Our on-board host has given a cell phone warning that we were making good time so the plant manager is standing on the sidewalk to meet us and we quickly fall in step to look at the entire facility.

Here is where China departs from U.S. manufacturing. There are no hard hats, no glasses, no earplugs and no warnings. They take our cell phones (for an unstated reason) but let us record and take pictures. We plunge into the place like we are visiting a neighboring farm and watch our own step as we walk through rail cars, towering sacks of soy meal, hot equipment and busy people. We have been taught to be cautious for so long, it is exhilarating, like riding in speeding car with your seat belt off.

The interpreters keep the conversation moving as explanations are given and questions are posed. The atmosphere is open and friendly. Among those things that are unusual, compared to an American facility, is the amount of manual labor. People wearing dust masks are folding sacks. Thousands of reinforced plastic bags that held domestic soybeans were dumped in the same location as the bulk beans that come in by rail on their last leg of a trip from Iowa farm fields. The work force is basic and active. They sweep with "corn brooms" and do basic jobs that would be automated in the United States. Sacks of beans and meal are stacked 20 feet high with no fork lifts or pallets.

Management is educated and accountability goes from bottom to top with clear delineation. The issue of safety is corporate and not government imposed. We enter a facility where we are warned not to touch the railing on a steep two-story stairway. The reason is that they have just painted it bright blue. We walk gingerly up and down and all goes well.

The farmers in our group note the meal grind is a little inconsistent but not problematic. Some of the product is bagged and sold directly, with the remainder going to their feed mill where it is mixed into several rations for swine and poultry. The company promotes itself with big signs showing three different branded swine feeds of varying protein content. The photo on the corresponding bag shows a small pig, a larger feeder and a sow.

In the process of following the soymeal through the facility, we take a tour through their vegetable oil area. The bottling is on the upper level away from our view but the 16.4 liter plastic jugs come down an elevator and are stacked in a storage room waiting delivery to retail outlets. Some of the oil is marked as "Non GMO" and comes from domestic production. A label, in English, says "No One Soyabean Oil" which means that it is the "Number One Soybean Oil." Perhaps it lost something in the translation from the Chinese version. The Chinese uses a lot of cooking oil in their homes and in restaurants, commercial serving halls, etc.

The jugs are flying out of the door into waiting trucks that have the company name on them. This brings me to the other inconsistency and that is transportation. One member of our group notes: "If it has wheels, it is a truck." The vehicles that are hauling meal, feed and oil are as diverse as you can get. A motorcycle with a small pickup bed is filled beyond capacity and takes off for the scale with great belching of smoke and loud popping sounds. A truck that looks like it is military surplus drives in to get its quota. The JGG vehicles are one ton truck size with a square box and big sign promoting their "Soyabean" oil.

Beyond this colorful drayage, the plant management and corporate leaders are excited about the growth they are seeing and the profit to be made on larger production of meal and oil. They welcome us to a conference table lined with dishes of ripe fruit and cups of hot tea. They project growth in their feed business of 40 percent over the next five years.

Iowa Soybean leaders speak about their farms with assurance they will do their best to grow a large crop this year but state concerns about limited soil moisture and another small harvest. Mark Jackson, ISA president, makes his point that the worst drought in 60 years only took his yields down 5 percent. Grant Kimberly, ISA international marketing manager, projects prices for a good 2013 crop could be as low as $10 but a short crop as high as $20, at which to managers, Mr. Wu and Mr. Hong, wince. Brian Kemp, ISA president elect and Kirk Leeds, ISA CEO, speak of quality and efficient shipping as AGP (soybean exporting and processing cooperative) representatives nod.

We break up the meeting with handshakes and a trip out to have pictures taken in front of the building where an electronic sign has been programmed to say: "Welcome Iowa Soybean Association." We are led by Mr. Wu, deputy general manager, to the entrance wall and assemble in front of the large sign for further documentation of our visit.

We board the bus and Grant Kimberly says, "Wave--the Chinese love that." We assume Mr. Hong also says: "Wave--the Americans love that." We all wave and turn our attention to our next flight and our next experience with these remarkable people in a remarkable period in time.

Editor's note: Ken Root has been an agricultural reporter for 37 years. Root now does daily radio and television programming and is a columnist. He can be reached at kenroot@gmail.com.

Date: 3/25/2013



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