Dim Sums: Agricultural Markets in China

Chinese companies are being punished for falsifying statistics they report to government statistical bureaus. Since last year the National Bureau of Statistics has been checking local statistics for falsification and misreporting. The Bureau has caught 97 companies in five provinces who will be assessed penalties, have their names published on a black list, and be reported to the "Credit China" web site and a national credit information sharing system. A list of 45 companies in Liaoning, Anhui, Fujian, Shandong, Sichuan, and Guizhou guilty of severe statistical falsification was published with the article. Another 54 companies have a second chance before they will be sanctioned.

China's Feed Industry Association has approved release of new swine and poultry feed standards calling for reduced protein content. The association described the standards as a "milestone" that will improve feed efficiency, relieve stress on the environment, and reduce China's longstanding reliance on imported protein materials for feed. At the October 26 meeting announcing the release, the association said current high rates of inclusion of soybean meal and other protein in livestock feed reduce efficiency and stress animals' metabolism. Low absorption rates means large amounts of nutrients are excreted in waste, becoming a major rural environmental problem. The association's new standards for feeder pigs, finishing hogs, layer hens and broiler chickens add upper limits on protein and phosphorus, reduce lower limits on protein inclusion, allow more synthetic amino acids, and reclassify animal growth stages in comparison with national standards published ...

Brazil has overtaken the United States as China's leading supplier of agricultural imports, as China's retaliatory tariffs begin to bite. Tabulations of imports in broad categories posted by China's customs administration indicate that imports of food and agricultural products from Brazil totaled $3.6 billion during September 2018, about 30% of the total. Imports from the United States were $625 million--a 5% share. China's imports from the U.S. normally fall to a seasonal low during the summer months. The September data are the first to reveal impacts of China's tariff retaliation. China's imports of U.S. ag products during September 2018 were down $690 million from a year earlier--a much larger margin than in July (when most tariffs took effect) and August. China's imports from the U.S. normally jump during November and December as soybeans from the U.S. harvest become available. It's possible imports from the U.S. could be down year-on-year by as m...

Soybean crushers anticipated making it through the next few months without U.S. soybeans in an October 14 article published in the communist party's Futures Daily , but they also expressed trepidation about tight soybean supplies. A futures analyst investigated the demand for soybean meal, the effect of trade tensions on soybean supplies and the impact of African swine fever on feed demand in the region by visiting 5 soybean crushing plants, three feed mills and a large integrated livestock company in Liaoning Province. This is a relatively small slice of China's soybean market compared to much larger crushers and feed mills in Shandong, Jiangsu and other coastal provinces further south. The 25-percent tariff on U.S. soybeans appears to have morphed into a boycott. All of the companies interviewed presumed there would be no imports of U.S. soybeans in the fourth quarter of 2018. There was no consideration that they might buy if the price is right--even though U.S. soybeans ...

African swine fever continues to spread in China. Most new cases this month have been in Liaoning Province, and large farms with thousands of head have been infected. Today, the Ministry of Agriculture acknowledged the first case in Shanxi Province (although previous reports found infected meat in markets in Shanxi earlier this month). Below is a compilation of all the cases reported on the Ministry of Agriculture and Rural Affairs web site since August 1, 2018. African swine fever cases reported by China Ministry of Agriculture and Rural Affairs (NR=not reported) Month Day Province City Location Farm size (head) Sickened Mortality Oct 17 Shanxi Datong Farm 15 7 4 Oct 16 Liaoning Panjin City Farm 161 43 43 Oct 15 Liaoning Tieling City Farmer co-op 6,640 50 14 Oct 15 Liaoning Tieling City Farm 4,323 1,030 1,030 Oct 15 Li...

Chinese farmers' wheat sales were down 30 percent this year, but the State Administration of Grain and Commodity Reserves says not to worry because there are plenty of reserves. Authorities plan to offer 2 million metric tons of wheat reserves for sale weekly to ensure stable supplies, but results of the first auction were underwhelming. Grain Administration statistics say a total of 50.15 mmt was procured from this year's wheat harvest as of September 30, 2018, the end of the main procurement season. That was 21.9 mmt less--about 30% less--than the volume of wheat procured during 2017. By comparison, the National Bureau of Statistics estimated that wheat production was 128.35 mmt, down 2.4% from last year. If these numbers are both true, farmers have sold less than 40% of the wheat they produced.   China 2018 wheat procurement Province 2018 volume change from 2017 Million metric tons Henan 12.065 -10.97 Jiangsu 10.207 -2...

China's September imports of soybeans and other agricultural products were relatively steady, and the market-year total was slightly ahead of last year's. But Brazil's supply of soybeans is entering its seasonal lull. The value of September agricultural imports reported by China Customs was $11.8 billion, down from $12.7 billion in August, but 8.8% more than the $10.66 billion imported a year ago during September 2017. September soybean imports were valued at $3.43 billion, down from nearly $4 billion in August but slightly ahead of the $3.3 billion value from a year earlier. The volume of soybean imports totaled 8 million metric tons during September, down from 9.15 mmt imported during August, but nearly identical to the volume imported a year earlier. According to customs statistics, the 12-month import total for October 2017-September 2018 was 94 million metric tons, up from 93.5 mmt during 2016/17. The average value of soybean imports per metric ton actual...

China's Ministry of Agriculture and Rural Affairs has lifted lockdowns on swine movements in three districts where African Swine Fever was discovered in early August, but new cases have appeared elsewhere. About a dozen local officials, traders and farm managers have been arrested or investigated for knowingly selling infected animals and falsifying health certificates. New incidents reveal that pigs are routinely shipped long distances, increasing the chances that the virus may be spreading far and wide. On September 29 the Ministry lifted a ban on movement of pigs from Shenyang (Liaoning Province), having found no further presence of African Swine Fever after six weeks of surveillance. Bans were lifted on September 30 for Zhengzhou (Henan Province), and October 3 for Lianyungang (Jiangsu Province). One September 28, new cases of ASF were confirmed on a small farm of 44 pigs in Jilin Province's Songyuan City, Changling County --8 pigs were sickened and 3 died. On the sa...

China's practice of draping a brightly decorated capitalist blanket over a socialist skeleton is evident in the Rural Revitalization Plan (2018-22) released September 26. China's Rural Revitalization Plan aims to designate land for agricultural, residential, forest and ecological uses, upgrade infrastructure, housing, and farming, clean up pollution, protect the environment and create a scenic countryside. The sprawling 36,000-character Plan is a little more than twice as long as the "Number 1 Document" that laid out the Rural Revitalization initiative  earlier this year, yet this "Plan" includes a similar stream of general statements with few details and only a few minor new items. The Plan has great ambitions to overhaul the countryside--to make it richer, cleaner, more scenic, more ecologically balanced, and more closely integrated with cities. In some ways the plan is similar to the 1958 "Peoples Communes" and the 1970s "...