Trade War Impact on Ag Imports Peaked in December

China's December 2018 agricultural imports were down 9 percent year-on-year. Impacts of the trade war peaked during the month as the value of agricultural products arriving from the United States plummeted 80 percent year-on-year. Imports of several feedstuffs and industrial raw materials from all trade partners plunged. Robust demand for commodities such as beef, dairy, fruit and nuts contributed to 9-percent growth in the overall value of China's agricultural imports for the entire 2018 calendar year.

December 2018 data from China Customs Administration's monthly bulletin released today indicate China imported about $11.5 billion worth of agricultural and food items during the month (down 9 percent from a year earlier). The calendar year total was $145.2 billion (up 9 percent from a year earlier).

China agricultural imports by value, December 2018
Item	December 2018	y-o-y  change	January-December 2018	y-o-y  change
	$Million	Percent	$Million	Percent
Agricultural products	11,498	-9.0	145,192	9.0
Major categories:
Oilseeds, hay, seeds	2,968	-32.2	53,353	-2.6
Seafood	1,091	31.0	11,600	43.7
Meat and offal	979	-2.3	11,019	16.2
Fruit and nuts	861	41.4	8,683	35.8
Edible oils	813	-1.7	8,609	3.9
Cereal grains	367	-33.9	5,794	-9.5
Dairy	427	15.4	5,601	10.5
Animal hides	315	-29.4	4,779	-15.4
Wool	248	-29.2	4,198	15.6
Cotton	927	14.7	9,890	14.8
Note: "Agricultural" total includes HS 01-24, 41, 51, 52. Source: China Customs monthly bulletin.

The December decline mainly reflects a plunge in soybean imports due to the trade war with the United States. The value of oilseed imports for the entire year was down by just -2.6 percent as China's increased imports of Brazilian soybeans nearly offset lower imports from the United States. December cereal grain imports were down about one-third from a year earlier, and the calendar-year total was down -9.5 percent. Animal hide imports were also down, both in December and for the year. Calendar-year imports of seafood, fruit and nuts, and dairy were up by double digits.

There were some differences within these broad categories. The volume of beef imports was up 40 percent in December, but pork imports were down 14 percent. Wheat imports were up, but imports of other grains were down sharply. December sorghum imports were minimal and barley imports were down by 75 percent from a year earlier. Imports of other feedstuffs, including fish meal, soybean meal, and cassava, were down sharply from a year earlier. Palm oil imports were up marginally. Big percentage year-on-year increases in imports of soybean oil, peanut oil, and rapeseed oil contributed marginally to the supply of imported edible oils. Imports of olive oil were down sharply.

Cotton imports continued their 2018 rebound in December, but imports of other raw materials used in manufacturing--wool, animal hides, natural rubber--were down sharply from a year earlier. China's imports of fruit, nuts, and dairy products were up in December.

China 2018 imports of major agricultural commodities,  by volume
Commodity	December 2018 imports	Year-on-year change	Jan-Dec 2018 imports	Change from 2017
	1000 mt	percent	1000 mt	percent
Meat and offal	355	-9.7	4,217	2.9
Beef	105	40.0	1,039	49.5
Pork	95	-14.4	1,193	-2.0
Mutton	28	0.2	319	28.1
Frozen chicken	44	4.9	502	11.5
Fruit and nuts	480	19.9	5,650	25.2
Dairy products	232	14.8	2,742	7.8
Cereal grains	1,090	-42.5	20,470	-20.0
Wheat	240	14.0	3,100	-29.9
Rice	270	-36.0	3,080	-23.6
Corn	420	-8.2	3,520	24.7
Barley	140	-75.4	6,820	-23.1
Sorghum	0	-98.0	365	-27.8
Soybeans	5,720	-40.1	88,030	-7.9
Edible oils	740	22.7	6,290	9.0
Palm oil	430	2.8	3,570	3.1
Rapeseed oil	140	133.0	1,300	71.2
Soybean oil	50	67.0	550	-16.0
Peanut oil	8	148.2	128	18.6
Olive oil	5	-38.4	40	-7.0
Sugar	170	25.8	2,800	22.1
Cassava	270	-65.5	4,800	-41.0
Fish meal	50	-12.3	1,460	-7.1
Soybean meal	0.1	-94.0	23	-62.7
Cotton	220	118.3	1,570	36.2
Wool	20	-38.9	370	7.0
Hides	48	-20.1	702	-7.0
Natural rubber	290	-22.7	2,600	-7.1
Chemical fertilizer	1,130	42.0	9,500	4.8
Source: China Customs monthly bulletin.

China's December 2018 agricultural imports from the United States totaled just $669 million, down from $3.4 billion a year earlier--an 80-percent year-on-year decline. China's agricultural imports from the U.S. for the entire 2018 calendar year were $16.2 billion, down $8 billion or 33 percent from 2017, based on the preliminary data from customs. Fruit and nuts stand out as the one category where imports from the United States were up from the previous year, both in December and for the entire 2018 calendar year. Imports from the United States in other major categories were down sharply. Grain and oilseed imports from the U.S. were under a de facto embargo in December--down 96 percent from a year earlier. Meat imports from the United States were down 88 percent from the previous December.

December is customarily the peak season for China's imports of U.S. soybeans, so the impact of the trade war on imports from the United States was especially prominent during the month. China's December imports in the oilseed category--dominated by soybeans--totaled just $69 million. That was nearly $2 billion less than the year-earlier total of $2.63 billion in December 2017. For the 2018 calendar year, imports from the United States in the oilseed category totaled $7.68 billion, down by $6.9 billion from the 2017 calendar year total.

China agricultural imports from United States by value, December 2018
Item	December 2018 imports	Year-on-year change	Jan-Dec 2018 imports	Change from 2017
	$Million	Percent	$Million	Percent
Agricultural products	669	-80.3	16,205	-33.1
Major categories:
Oilseeds, hay, seeds	69	-97.4	7,678	-47.3
Seafood	60	-46.5	1,251	-4.8
Meat and offal	16	-88.1	537	-54.8
Fruit and nuts	172	81.1	808	5.4
Edible oils	9	83.1	106	-23.5
Cereal grains	1	-96.4	909	-39.8
Dairy	17	-52.1	329	-23.2
Animal hides	59	-40.2	886	-26.1
Wool	0	-67.2	19	12.5
Cotton	53	-32.9	1,106	3.1
Source: China Customs monthly bulletin.