Wednesday, January 23, 2019

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.


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