In recent years, China's soybean industry became compartmentalized: imported GMO soybeans are used in the edible-oil crushing industry while domestic non-GMO soybeans are used for foods like tofu and soybean milk. As Chinese soybean production falls, there are indications that use of imported soybeans is spilling over into the food processing sector.
A June article on a Chinese website noted that food processors--including some large fast food chains--began using imported soybeans in 2012 as they became cheaper than domestic soybeans. The price advantage of imported soybeans was about 1000 yuan per metric ton in 2014. Now, says the article, "people are worried that imported GMO soybeans are going directly into their stomachs."
The article explains that soybean crushing plants directly purchase imported soybeans in most of the 20 or so ports where the beans enter China. However, there is an open market for soybeans at two ports--Qingdao and Lianyungang--where imported soybeans are mixed with domestic beans. Soybean traders from surrounding areas have been coming there to buy soybeans. Traders from several cities in Anhui reportedly buy imported soybeans for use in tofu and other soybean food products. Others use them for making soybean products like the strips of tofu in hot and sour soup.
"Anhui Province's soybeans are only available after they're harvested and the price for soybeans from the Northeast is too high, so when cheap soybeans are available we have to use them," said a trader from Huainan City quoted in the article. He said the imported soybeans have been in use for years and there has been no problem from people eating them.
A recent soybean market analysis reports very similar information about growing use of imported GMO soybeans in food processing over the past two years.
However, this is an issue of high Chinese soybean prices--not GMOs. The soybean market
analysis also notes that shipments of non-GMO soybeans from Russia have been
arriving in Heilongjiang Province this year, with prices about 200 yuan/ton less than Chinese soybean prices in that region. Some manufacturers of soybean foods and soy sauce have been using the Russian beans. Reports last year revealed that Chinese farmers growing soybeans in Russia had shipped more of their beans back to China after the crash of the Ruble.
This phenomenon is the result of China's policy that supports corn
prices at an artificially high level. The high corn price induces farmers to switch their
land from soybeans to corn, thus creating an oversupply of corn and a short supply of domestic soybeans. Tofu-makers have to either bid against each other for a shrinking supply of domestic non-GMO soybeans or find alternatives. A type of Anhui soybean favored by processors reportedly sells for 5000 yuan per metric ton. The "target price" for Heilongjiang soybeans is 4800 yuan per metric ton. Imported GMO soybeans sell for 3200 yuan per metric ton or less, and imported non-GMO Russian soybeans sell for 3600-3800 yuan.
The supply of domestic soybeans looks set to decline further. A crop tour of China's northeastern provinces last month estimated that area planted in soybeans declined 25% in 2015 while corn area increased 5%. The 60.5 yuan per mu "target price subsidy" for soybean farmers in the northeastern provinces was not enough to induce them to grow more. In Henan and Anhui, there is no soybean subsidy. According to a soybean market report last week, soybeans have disappeared in some regions of Henan and Anhui Provinces. However, an early-maturing variety grown in Hubei Province is getting a lot of attention and sells for a very high price.