July 25, 2014
China's beef imports to double by 2018: Rabobank
Rabobank Group expects beef imports to China to double by 2018, according to the organisation's report on July 23.
While the demand for high-protein food in the country is growing, local beef production is falling at the same time, said Pan Chenjun, a senior analyst at the bank. "The domestic beef industry is lagging behind all major beef-producing countries in terms of breeding, productivity, farm management, grassland and feed resources and other key aspects," explained Chenjun. "In other words, China will still need to rely on beef imports."
With imports almost quadrupling on-year to about 300,000 tonnes, China has become a major beef importer in 2013. Rabobank forecasts annual import growth of 15-20% in the next five years, although the actual volume of imports may actually double official figures due to widespread smuggling.
"Cattle farmers are shifting to other agribusinesses due to a lack of government support and the large amounts of time and money required to raise cattle," Chenjun said. "Major players are facing the dilemma of where to source beef supplies."
China has raised support to the beef industry in order to improve domestic production. However, the move is insufficient to fill the gap between demand and supply. According to Rabobank, the country aims to increase production from 6.3 million tonnes in 2013 to 7.17 million tonnes in 2015, and 7.86 million tonnes in 2020.
There are also signs that China is changing its stance on beef imports. Chenjun believes that the country is likely to lift the mad cow-related ban on Brazilian beef within the year and permit US beef imports in the next two years.
Australia, the top supplying country to China occupying 52% of total imports during the first five months of 2014, faces declining production due to a serious drought.