The latest out of the USDA attache in Beijing shows Chinese imports of soybeans will hit a record 100 million metric tons next season, as unrelenting consumption boosts growth in the giant nation. In its first forecast for 2018/19, the USDA forecast China’s imports rising by 3 million metric ton from this season’s 97 million metric tons, which is the current record high. There are numerous reasons for this growth — expanding consumer preferences for meat, seafood, vegetable oils and soybeans for food processing is one of the key pieces. Add to this, the fact that China’s crushing industry continues to be strong, with an estimated potential to crush 500,000 metric tons of the oilseed a day. China’s low imports of DDGS is also a factor in boosting soybean imports in 2018. The bureau also pointed to China’s soybean production falling back to 14.3 million metric tons this year as corn remains the better option for farmers. Plus, you have little public support from updated seed technology which causes yields to remain stagnant. Without the latest seed technology Chinese soybean farmers struggle to improve productivity. Of course, the bureau highlighted continued competition from rival origins, particularly Brazil. Interestingly, the bureau did not speak about the rising trade tensions between U.S. and China. We continue to hear that U.S. soybeans are a top target of tariffs the Chinese government could levy on U.S. exporters. (Source: USDA, Beijing Bureau)
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