June 24, 2011

 

China to increase US soy imports to meet high demand

 

 

China's soy imports are expected to rise by 5% more than last year to meet rising demand, increasing the attraction of the country to US soy farmers and helping to promote China-US relationships.

 

"China is the most important market for US soy, and the soy trade will play a large role in improving the balance of China-US trade," said Alan Kemper, president of the American Soybean Association.

 

To consolidate its position, the US soy industry will invest more than US$2 million this year in China's market, Kemper said.

 

The investment will finance programs teaching Chinese farmers efficient ways of using soy to improve the production of swine, poultry, dairy, and other agricultural sectors, according to the association.

 

"These programs have been carried out for the last 30 years since we arrived in China," said Marc Curtis, chairman of the United Soybean Board. "We will continue our efforts to serve China's market."

 

China is the largest importer of US soy, importing a quarter of the country's domestic production last year.

 

Zhang Monan, a researcher at the Economic Forecast Department of the State Information Centre, said soy trade between the two countries will help maintain a stable development in bilateral relations.

 

Given constraints over land and water resources, it is difficult for China to meet growing demand for agricultural products such as soy domestically, but it can buy agricultural products with its bulky foreign reserves.

 

Even with the fresh demand in China's market, the competition is growing fiercer in the international market, as imports from South American countries such as Brazil and Argentina have also increased in recent years.

 

China imported a historic 54.8 million tonnes of soy in 2010, compared with 15.2 million tonnes of domestic production, according to data from General Administration of Customs. The country's self-sufficiency rate currently stands at 22%.

 

China's soy imports declined by 1% year-on-year, to 4.56 million tonnes in May, even as soy imports during the first five months of this year remain largely the same compared with the same period last year.