April 16, 2009

China's total oilseed production is forecast to decrease slightly in 2009-10 while domestic consumption is expected to grow during the same period, the US Department of Agriculture's Foreign Agricultural Service (FAS) said Wednesday (Apr 15).

FAS said China's total oilseed production is expected to decrease to 56.9 million tonnes as the soy planted area has been reduced. Despite efforts by the Chinese government to boost oilseed production, the poor returns received by farmers in 2008-09 have led to decreased planting intentions for major oilseeds except rapeseed. FAS added that other factors such as lack of preference in subsidisation, contesting for land from other crops and urban expansion also affected the expansion plans for oilseed planted area.

Meanwhile, the country's consumption of oilseeds in 2009-10 is forecast to rise three percent to 94.3 million tonnes. The demand for domestic oilseeds in feed production is on the gradual decline due to increasing food use and stagnant domestic production. With the gap between demand and domestic production estimated to grow, oilseed imports comprising mostly of soy and rapeseed will also increase to meet domestic consumption demands. Oilseed imports are expected to grow by four percent to 38.8 million tonnes.

On the other hand, based on a reduced planted area of 9.1 million hectares and average yields, China's soy production in 2009-10 is projected to decrease 2.5 percent to 15.6 million tonnes.

With considerations to moderate GDP growth and continued consolidation in the livestock sector, China's soy imports in 2009-10 will increase to 38 million tonnes, up 1.8 million tonnes from 2008-09.