Dim Sums: Agricultural Markets in China

This year 1,230 Chinese companies applied to import corn, including the world's biggest feed-milling  and swine-producing companies. Starch and ethanol producers that were subsidized in past years to sop up excess corn are now clamoring to import corn as well.  China flipped from corn exporter to importer in a short space of time. Twenty years ago China exported 16.5 million tons of corn, but in 2022 China imported 20.5 million tons and will probably import a similar quantity this year.  Note: Calendar years. Source: China customs statistics. Clues about China's soaring demand for corn can be gleaned from a list of applicants for the tariff rate quota (TRQ) that allows up to 7.2 million tons of corn to be imported at a 1-percent tariff each year. Imports outside the TRQ system are charged a deal-breaking 65 percent tariff. Prospective importers have to apply every September for a share of the following year's quota. Chinese authorities grudgingly agreed to publicly releas...

China's statisticians claim meat output reached a record high in 2022, but meat prices and imports are still at historically high levels.  Official data show that China's meat production increased to a record 92.3 million tons in 2022, up from 88.9 million tons in 2021. The 3.8-percent increase seems inconsistent with 0 growth in feed production through November shown by China's feed industry association and a decline shown by the Alltech feed survey. China's meat prices also remain at historically high levels despite the record output and large portions of the country locked down during 2022.  Customs data also show that meat imports reached 7.2 million tons in 2022, lower than the previous two years due to an increase in pork tariffs and declining pork prices during the first half of the year. However, last year's meat import figure was still higher than any year before African swine fever caused imports to spike during 2019-20. The sum of meat output and imports ...

China's farmers boosted soybean output by 23.7 percent--as directed by authorities--but now they're having trouble finding buyers for the beans.  Chinese officials launched a frenetic campaign to boost soybean output in 2022 in order to reduce reliance on imported soybeans. Statistics show that area planted in soybeans increased 21.7 percent, exceeding the goal for soybean and oilseed planting set by last year's "Number one document" to increase soybean self-sufficiency. Goaded on by very generous soybean subsidies and hectoring by officials, the output exceeded 20 million metric tons for the first time ever.  The harvest total is nevertheless still far short of the 91-million-ton import total for the 2022 calendar year just announced by customs officials. Soybeans harvested on the outskirts of Beijing. The news is not all good for farmers, though. Today an agricultural official fretted about falling soybean prices at a press conference on agricultural affairs . T...

China's publicly listed hog companies continued boosting their share of sales during 2022. Data compiled by Futures Daily showed that 16 companies reported a combined 129.2-million head sales total in 2022. [update: This is 18.5 percent of national hog slaughter of 700 million head announced today by the National Bureau of Statistics .] Compiled by Futures Daily from financial reports. Combined sales by listed companies were up about 30 percent from 2021. The largest company, Muyuan, has tripled its output since 2020. Muyuan sold 61.2 million head last year, up from 40.3 million in 2021 and 18.1 million in 2020. Wens Foodstuff recovered its number-2 position with 17.9 million head after seeing a dramatic drop during the African swine fever years of 2019-20. Financially troubled Zhengbang Sci-tech saw a decline in sales while New Hope Group had another year of expansion. [update: National hog slaughter increased 4.3 percent during 2022, according to the National Bureau of Statistic...

China is dumping its surplus rice in developing countries at below-market prices. In doing so, China has now fully replicated the policy missteps made by North American and European countries during the last century.  China is simultaneously one of the world's largest importers of rice and one of the largest exporters. China imported 2.6 million metric tons of milled rice in the first 11 months of 2022, but it also exported nearly 2 million tons. (This excludes 3.4 million tons of broken rice imports used for animal feed discussed here last September .)  Note: excludes broken and rough rice. *2022 for January-November. Until 2016, China's rice exports were a dribble of medium grain rice sold to merchants in Japan and South Korea. Then exports suddenly boomed to about 2 million tons annually beginning in 2018. What happened? The exports are mainly medium grain rice, a variety grown in northeastern provinces and the Yangtze River delta. Northeastern rice has a reputation fo...

Xi Jinping laid out his vision for building a "strong agricultural country" in the next phase of China's socialist modernization in the communist party's second century of ruling China. The "important speech" given at the December 24, 2022 Rural Work Conference in Beijing was meant to kick off a "new journey" in China's building of a "strong Socialist country" [ English in Xinhua ]. The speech was riddled with insecurities and contradictions as the country's growing demand for food clashes with the country's shortage of resources, lack of innovation and the leadership's insistence on Maoist dogma and self-reliance. Xi's high-profile speech is unusual for the rural work meeting which is usually conducted with no fanfare. Xi also brought along his new henchmen Li Qiang, Wang Huning, Han Zheng, Cai Qi and Ding Xuexiang. Xi made outgoing Premier Li Keqiang--snubbed for Xi's new leadership team--give a speech extolling...

China is on alert for the impending spread of the COVID-19 virus in the countryside. A December 24 videoconference on rural COVID-19 prevention and control ordered officials to be on the alert to fight the spread of the virus in rural areas expected as millions of people return to their home towns during the January holidays.  Today's Securities Times reported  that the virus was spreading rapidly in late December. An online survey conducted by provincial disease control authorities showed that 35% of Hainan Province's population was infected during the week of December 19-25, up from 5.6% the previous week. Hainan authorities expect the infection rate to reach 50%. Various cities in Zhejiang Province had infection rates of 30%-to-40%, and Sichuan Province estimated its infection rate at 64.5% during the last week of December 2022. Officials at the December 24 meeting were warned that the countryside is a weak spot for virus control due to the vast population with low vaccina...