March 9, 2020

 

China's soybean imports in January and February 2020 increase 14% year-on-year

 

Data from the General Administration of Customs showed China imported 13.51 million tonnes of soybeans in the first two months of 2020, a 14.2% year-on-year increase, reported Reuters.

 

This is due to soybean shipments from the United States that have cleared customs. These soybeans were booked at end 2019.

 

Soybean shipments in January and February 2019 was at 11.83 million tonnes. In December, China purchased 9.54 million tonnes of soybeans.

 

Customs combined the data for January and February beginning this year as data from the first two months of the year is distorted because of the Lunar New Year celebrations. The COVID-19 outbreak further disrupted business this year.

 

China's soybean crushers imported additional soybeans from the United States after the Chinese government introduced tariff-free quotas for selected American cargoes after the US-China Phase 1 trade deal.

 

Selected crushers have already been given tariff exemptions for the import of soybeans from the United States.

 

Operating rates at soybean crushing plants have been affected by the movement restrictions imposed due to COVID-19, disrupting raw materials and processed products transportation.

 

With COVOD-10 measures easing as infections have decreased in China, crushing rates are projected to slowly rise.

 

The fourth quarter and early months of a new year are dominated by soybeans from the United States, results from the country's autumn harvest.

 

Shipments of soybeans from the United States to China were hampered by a trade war over the last 1 ½ years. The US-China Phase 1 trade deal signed mid-January saw China pledge to purchase additional agriculture goods from the United States, but it has currently not done so.

 

Sonny Purdue, US Agriculture Secretary predicted China will boost soybean purchases from the United States in late spring and summer.

 

The African swine fever outbreak in China, which has decimated more than 40% of China's swine herd, also reduced demand for soybean as livestock feed.

 

-      Reuters