Under last week's Sino-US accord, the key to China's eventual entry into the WTO, tariffs on beef are to fall to 20 per cent from 45 per cent upon accession to the global trade body. "Instead of 10 per cent growth a year, meat production now looks like it will grow by three to four per cent," said general manager of Dongling Trading Corp Vincent Fan.

The slower growth would lead to less demand for soymeal, he said, speaking at an industry seminar on soybeans on Friday.

Other industry executives at the seminar shared his sombre assessment. A manager of a provincial grains trading firm said that the phasing-in of the tariff -- providing China clears remaining hurdles to join the WTO next year -- would deal a blow to the fragile recovery of the domestic meat sector."Meat prices have stopped falling, but demand is still soft," he said. "The consumer base is not growing to accommodate more imports."

But with lower tariffs on imported meat, affluent urban consumers are likely to eat more high-quality foreign beef, and budget-conscious shoppers will buy more imported "trimmings" like chicken feet and tripe, he added.

Many Chinese consumers, worried about job security and rising expenses for housing, education and medical care, are still tightening their belts, the manager said.

He was not optimistic about China's meat exports to neighbouring countries, which had yet to show signs of recovery from steep falls in demand during the Asian financial crisis.

China exported 40,000 tonnes of pork in the first 10 months of 1999, down 56.7 per cent from the same 1998 period, according to customs data.Thailand, aided by a sharp depreciation of its currency, has moved into Japan's poultry market, grabbing China's market share, he said.

"With a strong renminbi, we cannot compete in the meat export market," the manager said, speaking of China's own currency, also known as the yuan. In fact, meat smuggled from neighbouring countries was one of the factors pressuring domestic meat prices, he added.

Du Dongping, a manager at Toepfer International, said the tariff on meat imports would shake up the entire chain of production, distribution and consumption.

"There will be short-term pain," he said.

Du said the meat sector could gain a few insights from the liberalisation of soybean trade five years ago. The drop of import duties for soybeans spurred the rise of beans imports, putting pressure on domestic farmers and crushers. In response, Beijing tried to ease the pressure on some sectors of the industry, imposing quota restrictions on imported soyoil and slapping value-added tax on soymeal.

Du expected the government to also ease the blow on the meat industry but said it was unclear what steps would be taken.