China's soybean output increases, but still 80% reliant on imports

Source:Global Times Published: 2019/10/14 12:23:39

Imported soybeans seen at a port in Nantong, East China's Jiangsu Province in August, 2018. Photo: IC

China's soybean production has increased 6.9 percent on a yearly basis, yet the output is still unable to meet market demand. Analysts say China is still 80 percent reliant on soybean imports.

China's soybean demand is more than 100 million tons per year, and "more than 80 percent of the market supply is imported. The soybean market remains dependent on imports," China Economic Net reported on Monday, citing expert Li Jun from the China Agricultural University.

China's soybean output will reach 17.1 million tons in 2019, an increase of 1.1 million tons or 6.9 percent on a yearly basis, according to a report from the China National Grain & Oil Information Center.

China will import 87 million tons of soybeans during the next marketing year from October 2019 to September 2020, up 4 million tons year-on-year or 4.8 percent. The increase is still below the historic high of 94.13 million tons from the marketing year 2017 to 2018, the Center said in the report.

Affected by the trade friction between China and the US and the outbreak of African swine fever (ASF), the quantity of imported soybean decreased in the third quarter of 2019. According to statistics, from January to August this year, China's soybean imports were at 56.32 million tons, 5.68 million tons less than the same period last year and a decrease of 9 percent. The outbreak of ASF led to a decrease in pig stocks, which caused a decreased consumption of soybean meal, the feed of hogs.

"The decrease in soybean consumption in China led to the decline of global consumption," Ma Wenfeng, a senior analyst at Beijing Orient Agribusiness Consultancy, told the Global Times on Monday.

"In 2018, the trade conflict between China and the US led to a decline in soybean demand. In 2019, imports and consumption of soybean declined further as the trade conflict remained unresolved," said Ma. "The extreme mercantilism and trade protectionism hurt others, and especially the US itself."

The average wholesale price of domestic soybean was 4,065 yuan ($575.30) per ton, and the after-tax price of imported soybean was 3,397 yuan per ton in October, the end of the soybean marketing year, according to data released by the Center on Saturday, which said that prices were within the forecast range.

In recent years, soybean production has increased significantly as a result of China's soybean-plantation promotion plan.

The production of domestic soybean increased, and the purchase price of newly produced soybean in North China's Heilongjiang Province was between 3,620 yuan and 3,640 yuan per ton, which basically stayed flat from the same period of last year. The China National Grain & Oil Information Center predicted that soybean prices may continue to fall after the new yield of soybean enters market.

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