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China


September 24, 2018

 

China's hog sector able to cut dependence on US soybeans, says vice chairman of Chinese soybean crusher
 

 

China could reduce its dependence on US soybeans to feed its hog herds through a six-part strategy, according to Mu Yan Kui, vice chairman of Yihai Kerry, one of China's largest soybean crushers.

 

He expressed this opinion during an agricultural exports conference in Kansas City, Missouri, US, during which it was argued that China would still need US soybeans.


The recent US-China trade war has resulted in the increased costliness of bringing US soybeans into China. However, Mu held that the latter could source from alternate suppliers with little trouble, while also claiming that foreign businessmen and politicians "have underestimated" the Chinese citizenry's support of its government.


Consequentially, such a move would impact the 36-year-old relationship between US farmers and the Chinese market, leading to a radical change in global trade, Reuter's September 19 report stated. The trade connection between both parties was worth US$12.7 billion in 2017.


One way for China to reduce its dependence on US soybeans is to cut soymeal content in pig feed, given that soy have been provided to Chinese hogs in amounts more than what is required. The cut would not curtail hogs' growth, experts and academics said.


Hence, soy rations for hog could be slashed from the usual 20% down to 12%. The reduction would translate to a cut of up to 27 million tonnes of soybeans yearly - or 82% of Chinese soy imports from the US last year.


In addition, major Chinese agriculture companies have begun cutting soy content through the optimisation of feed ingredients to ensure best nutrition availed at the lowest cost possible. The current trade war could also encourage more smaller scale hog operations in China to cut soy content.   


Mu's measures - which include using rapeseed or cotton seed as alternate protein sources, tapping into the Chinese government's reserves of soybeans, and producing soybean locally - reflect a line of thinking now accepted by China and national agriculture firms, Reuters said.


In fact, one feed mill owned by Beijing Dabeinong Technology Group Co. would not only exclude US soybeans from its feed mix by October, but will also replace soy imports with more cornmeal and alternate protein sources, the site's manager claimed.


In the meantime, a USDA spokesman had downplayed the possibility of reduced exports of US soybean to China.


Wallace Tyner, a Purdue University economist, described Mu's remarks as a "political speech".


- Reuters

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