September 29, 2009

China's imports of US soy are unlikely to be affected by a trade dispute between the two countries over exports of Chinese tires, said Li Ming, general manager of the agriculture trading and logistics department of China National Cereals, Oils & Foodstuffs Corp (COFCO).

Concerns were raised earlier this month that US tariffs imposed on tires from China would lead to a retaliatory slowdown in purchases of US crops and farm products.

The US placed tariffs of 35 percent on tires from China early this month, acting on a union complaint that imports were pushing workers out of jobs.

Following the US actions, China launched an investigation into the alleged dumping of American automotive and chicken products.

China is the largest purchaser of US soy and the second-largest importer of poultry and pork.

Soy growers in the US, the world's biggest supplier, want to increase the livestock feed sales to small landowners in rural China to help boost exports, the United Soybean Board reported.

China's feed industry consumes about 100 million tonnes of protein meal annually, with half of that used by small land-holders who often feed table scraps to their chickens, hogs and dairy cows, said Thomas Wray, a director of the board that helps to market US soy globally.

Meanwhile, Wray pointed out that soymeal only makes up about 30 percent of China's protein meal needs. He added that China's untapped rural feed industry "is the largest meal market in the world" and the US should not miss out on this huge opportunity and it should continue to educate the rural part of China on how to feed their animals.

US soy growers are counting on expansion of the world's third-largest economy to boost the demand for meat and to encourage China's farmers to switch to feed-meals to increase productivity. On the other hand, soy futures have dipped 21 percent since the end of May on a forecast for record US soy output in the 2009-10 marketing year.