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JD comes out with $2b sourcing plan

By Fan Feifei | China Daily | Updated: 2017-11-09 07:30

JD comes out with $2b sourcing plan

JD's unmanned small-sized driverless vehicle is pictured on June 18, 2017. [Photo provided to chinadaily.com.cn]

JD.com Inc, China's second biggest e-commerce player, announced on Wednesday that it intends to purchase more than $2 billion of goods from the United States over the next three years, including the import of more than $1.2 billion of beef from Montana Stock Growers Association (MSGA) and pork from Smithfield Foods.

The agreement was signed as US President Donald Trump started his first state visit to China.

JD said in a statement that it will import Montana-sourced beef from Cross Four Ranch and MSGA members for direct sale to the 258 million Chinese consumers on its e-commerce platform.

The procurement agreement is for an initial three years, with a minimum commitment of $200 million in beef to be imported by JD from Cross Four Ranch and MSGA members at fair market value during the term. It is estimated that JD's purchase of Cross Four Ranch and MSGA beef will increase Montana beef export sales by as much as 40 percent in 2018.

"These groundbreaking agreements bring together two of America's most trusted and in-demand meat suppliers with China's leading e-commerce platform, to the benefit of both US producers and Chinese consumers," said Liu Qiangdong, JD's chairman and CEO, who attended the signing ceremony.

"We look forward to expanding our long-term cooperation with high-quality US meat producers like Smithfield and MSGA," Liu said.

Meat products are a fast-growing category for the e-commerce giant. Direct sales of meat on JD increased more than 780 percent year-over-year in the first half, with imported meat accounting for more than 30 percent of those sales.

 

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