August 1, 2006

China soybean import growth rate to slow next crop year
 

Chinese soy imports would continue to remain high in the crop year starting October 2006 although the growth rate would slow from the current year, Shanghai JCI analyst Hanver Li Qiang said Tuesday (Aug 1).

Speaking at the third Southeast Asia-US Agricultural Cooperators' Conference, Hanver said Chinese soybean imports in 2006-07 are expected to be above 30 million tonnes, compared with an estimated 28 million tonnes in 2005-06.

But China's earlier experience of soy imports doubling every three to four years would not be seen from now on as the livestock sector has entered into a slow-growth phase, he said.

Bird flu and foot-and-mouth disease have cut poultry and pork consumption in urban China, leading to the slowdown in demand growth for feed, he said.

There is also a trend of declining soymeal consumption as Chinese feed millers step up consumption of rapeseed meal and cottonseed meal, he noted.

Over the last few months, China's soymeal consumption has fallen by around 30 percent to 50 percent on-year, he said.

If the Chinese breeding industry can successfully shake off slack growth in the long term, there is a chance that Chinese corn imports would witness a noticeable increase and may even turn China into a country mainly dependent on imports to meet its domestic demand, he said.

One interesting trend, however, is the oversupply of wheat in the Chinese market which has led to wheat replacing corn in feed production in larger volumes than seen in previous years, he said.