Jack Ma, Alibaba Group Holding Ltd's BABA founder and chairman, is the richest person in all of China.
Ma’s company, which reported 54 percent sales growth in its first earnings report since going public and is now officially worth more than Wal-Mart Stores, Inc. WMT, has become a force to be reckoned with.
Taking America To China
When Ma told The Wall Street Journal he was interested in bringing America to China because, “… selling Chinese products around the world—that’s the past 10, 15 years,” people listened.
Noting that 110 million to 120 million people shop on Alibaba every day, Ma said, “Because when you have such a huge demand of good products from outside, the next 10 years, I believe, China should import.”
Ma’s Priority
Ma has clearly made the importing of American (and other foreign) goods into China a priority for his company.
As he noted in Alibaba’s September filing, "Our proposition is simple: We want to help small businesses grow by solving their problems through Internet technology."
While that works as a two-way street with regard to Chinese products coming to America, it also would make it easier for American entrepreneurs to export their goods to China.
Commodities
When it comes to the types of products most viable in the Chinese market, Ma pointed first to farm products. He cited pollution in China as a major problem restricting the country’s ability to grow quality food.
Ma noted that last year, for example, Alibaba sold 150 tons of Washington state cherries, 80 tons of nuts and a large amount of seafood from Alaska to consumers in China.
Agricultural Exports To China
As Jack Ma clearly knows, China already buys a lot of U.S. agricultural exports. Now he wants in on the action.
According to the United States Department of Agriculture, China became the top destination for U.S. agricultural exports, ahead of Canada, in 2010.
The USDA reported that U.S. farm exports to China nearly doubled from $13.1 billion in 2009 to $25.9 billion in 2013.
Strong U.S. Dollar
One potentially important factor, according to Seery Futures president, Mike Seery, would be the continuing strength of the U.S. dollar, which currently stands at a four-year high.
Seery told Benzinga, “The U.S dollar is bigger and stronger than Jack Ma and will continue to push prices lower.”
At the time of this writing, Jim Probasco had no position in any mentioned securities.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
