Dim Sums: Agricultural Markets in China

Customs data show that China's imports of U.S. soybeans during February 2019 bounced back to 907,754 metric tons. That's up from 135,772 metric tons in January and the largest volume since trade tensions began last April, but still far behind the 3,344,521 metric tons imported in February 2018. Brazil was again the leading source of China's soybean imports in February 2019. China imported 1,986,344 metric tons from Brazil, less than half the 4.9 mmt imported from Brazil in January and the smallest volume from that country since February last year. February is normally the seasonal low for China's imports of Brazilian soybeans. The remainder of China's 4.456 mmt of imports during February was filled out by Argentina (841,394 mt), Canada (644,005 mt), Russia (45,499 mt), Uruguay (30,019 mt), and Kazakhstan (990 mt). China's cumulative soybean imports for the market year since October are down 8.1 million metric tons from a year earlier. October 2018-Februar...

The first round of China's pork reserve purchases have been scaled back from 100,000 metric tons to 10,000 metric tons, according to a China Feed Industry Information Network report . Stronger hog prices last week may have reduced the urgency of removing pork from the market. According to the report, the average hog price in China increased 3.85 percent last week. The average was 12.42 yuan/kg, up from 11.96 yuan/kg the previous week. However, the average price of pork fell 0.3 percent and the ex-factory price of a swine carcass fell 1.05 percent. The report confirmed that pork reserve purchases were due to begin March 8, but "100,000 changed to 10,0000." The 10,000 metric tons of pork translates to 143,000 hogs, the article said (assumes 70 kg of pork per animal). The reason for scaling back purchases is not identified, but rising prices may have prompted the decision. The analysis said the volume of swine being produced is shrinking slightly, but consumers are red...

Chinese farmers are looking for more clarity about promises of higher subsidies for corn and soybeans so they can decide whether it's worth renting land for upcoming spring planting. Chinese officials hoping to carry out a policy directive to expand soybean production this year recently announced that this year's subsidy payment for soybeans would exceed the corn subsidy by 200 yuan per mu this year, but they did not announce the amount of the subsidy for either crop. In Heilongjiang Province--the largest producing region for both crops-- last year's payments were 320 yuan per mu (about $280 per acre) for soybeans but the corn subsidy was slashed to 25 yuan per mu ($22 per acre). There are also "land rotation" payments for farmers who switch land from corn to soybeans or other crops. Officials in Heilongjiang also recently announced they would buy up 200,000 metric tons of soybeans for provincial reserves to bolster soybean farmers' confidence. An articl...

Chinese authorities are planning to buy as much as 200,000 metric tons of pork for government reserves to bolster the confidence of pig farmers shaken by the African swine fever epidemic. The 12-percent shrinkage of China's swine inventory last year reported by the Ministry of Agriculture and Rural Affairs was the largest decline ever recorded, according to a China Agricultural university professor who spoke at a press conference on ASF put on by the Ministry last Friday . The professor attributed the shrinking herd to farmers' worries about African swine fever that discouraged them from replenishing herds; cash flow shortfalls; accelerated withdrawal of small-scale farms due to industry upgrading; and consumers shifting purchases away from pork to other foods. The professor assured listeners that officials are pondering policy measures to help farmers deal with the difficulties and urged farmers to exercise good prevention and control measures and add to their he...

Top Chinese grain-producing provinces hope to bolster weak domestic corn and soybean markets by purchasing commodities for provincial reserves in March and April. The move signals weak market conditions in China for soybeans and corn despite having cut off nearly all imports of both commodities from the United States since the trade war began last year. Chinese news media say Heilongjiang provincial authorities issued a "Notice passing down purchase prices for the first 2019 provincial-level reserve purchases of corn and soybeans" that calls for additional purchases of the two commodities that will be added to provincial reserves. The document--issued February 26 by Heilongjiang Province's Grain Bureau, Finance Department, and the provincial branch of the Agricultural Development Bank of China--sets prices of 1600 and 1620 yuan per metric ton for reserve purchases of corn in two zones of the province and soybean purchase prices ranging from 3420 yuan/mt to 3460 yuan/mt...