December 1, 2017
China continues to underpin world's soy exporters
China will continue to drive global soybean consumption, which is projected to grow over 4% in marketing year 2017-18. During this period, China's own soybean consumption is forecast to rise twice as the global rate by nearly 8%, as imports surge to a record 97 million tonnes, according to the US Department of Agriculture.
USDA, in its report "Oilseeds: World Markets and Trade" released last month, said growing population, rapid urbanisation, rising incomes and improving living standards have spurred China's meat and fish consumption, creating strong demand for protein feeds. "Rising feed production, combined with increasing high-protein ingredients in feed rations have been driving soybean imports upward for the last decade".
USDA forecasts that soybean crush for feed will continue to grow, supporting the almost 5% growth in hog production.
Historically, the Chinese crush sector has been expanding almost entirely on imported soybeans,
with much of the domestic crop used for food consumption (such as tofu) or purchased by the
State Reserve Bureau.
China became the world's largest soybean importer as early as 2003, and in 2016/17 (October-September) it accounted for nearly two-thirds of global soybean imports. It continues to underpin the expansion of soybean production in Brazil and the US.
At present, though, the Chinese government is encouraging higher oilseeds production by cutting subsidies to grains, and according to the USDA, it is likely that the government's support will continue to spur modest growth in soybean area and production.
"However, these (soybeans) are more likely to be consumed as food rather than feed. As a result, long-term, China seems poised to remain a key market for other soybean producers and exporters, such as the United States", USDA said.