Dim Sums: Agricultural Markets in China

China's ban on 5 U.S. agricultural exporters contrasts with its lenient approach to domestic product safety and to suppliers in favored countries. This highlights China's cynical use of plant and animal quarantine and food safety inspections as a tool to control the flow of imports and to "diversify" import sources.  On April 4 China's customs administration suspended 4 U.S. suppliers of sorghum and meat and bone meal and 2 suppliers of poultry products  (one company appears to be on both lists): Chinese customs said they detected levels of zearalenone--a mycotoxin produced by certain types of mold--in the sorghum supplier's shipments.  Chinese customs said they detected salmonella in shipments by 3 companies of meat and bone meal to be used in animal feed.  Chinese customs said they detected furazolidinone, a drug banned in China, in three batches of chicken products supplied by 2 U.S. poultry producers. A Customs administrator cited Chinese laws and regulat...

Chinese news media say the country is confident it can cope with reduced supplies of U.S. farm goods as China raises tariffs on U.S. agricultural products. China's trade war tariffs on U.S. products are approaching 100% after China announced an 84% tariff on U.S. goods today to counter President Trump's announcement of 125% tariffs on Chinese goods.  China's "party line" is that U.S. farmers will be hurt more than China by the tariff war because China has diversified its import sources, increased domestic production, and reduced use of soybean meal in animal feed. Weak consumer demand in China and deflationary pressures also reduce China's vulnerability to tariffs on farm product imports...at the same time these factors pose the gravest threat to China's economy sliding over the edge if its exporters of consumer and industrial products lose U.S. markets in the trade war. An April 9 article, " China strengthened self-sufficiency in agricultural product...

  China's Peoples Daily warned that a trade war could destroy the foundation of China-U.S. agricultural cooperation. An April 2 opinion piece praised the mutual complementarities in agricultural trade between the two countries, pointing out that U.S. agricultural products fulfill demands in the China market while also driving industry development and farm income growth in the United States.  The article blames the U.S. for impacts on U.S. farmers expected to result from China's imposition of  tariffs that specifically target U.S. agricultural products in retaliation for U.S. tariffs on Chinese products. On its face, the article seems to be aimed at the Trump administration, but it seems unlikely that Trump administration officials will read a Chinese language article in a publication whose readership is primarily communist party officials. Chinese officials have already decided to impose tariffs aimed at farm products, so who is this article trying to convince?  T...

China's latest plan to upgrade the quality of its farmland was  announced by China's Xinhua News Agency  March 30, 2025. The new target is to create 1.35 billion mu (90 million hectares) of "high standard farmland" by 2030. (China's total amount of arable land is 1.93 billion mu, or 128.6 million hectares.) The new plan implements a decree issued in the 2023 "Document No. 1" that all "permanent basic farmland" be converted to high standard farmland. The 2024 and 2025 "Documents No. 1" also included paragraphs directing officials to build high standard farmland. The "high standard farmland" initiative aims to overhaul village-wide parcels of land by leveling fields, consolidating fragmented plots, installing drainage ditches, wells, irrigation pipes, access roads, and electric lines to make fields more productive, resistant to droughts and flooding, and accessible for farm machinery. The goal of the initiative is to raise the...

China had 128.6 million hectares of arable land in 2023 according to the Ministry of Natural Resources' Communique on Natural Resources released last week. That was a 1-million-hectare increase from the previous year's value published in the China Statistical Yearbook . In contrast, the area sown in crops dropped by about 1 million hectares to 169 million hectares in 2023, seemingly in conflict with the increase in cultivated land area reported by the Ministry of Land Resources. The area sown to crops had peaked at nearly 170 million hectares in 2022.  The area sown to crops in China exceeds the cultivated area because some land is planted intensively by planting 2 or 3 crops each year on the same field. (In contrast, the amount of harvested crop area in the United States is substantially less than the total area of cropland because a substantial amount of U.S. land is left fallow or put into conservation uses.) There is no explanation for why the rising trend in sown area ...

China is cracking down on a black market for fur animal carcasses by turning them into animal feed ingredients. A pilot program was proposed by agricultural officials as part of an initiative to create substitutes for soybean meal in animal feed. Two years later the situation on the ground doesn't look much like the nice, neat program designed by agricultural officials. Shanghai news publication  The Paper  posted a video of a “shadow visit" to expose a black market for carcasses of foxes and raccoon dogs raised for their fur  ( full text version here ). The 34-minute video showed lines of outdoor metal cages holding foxes and raccoon dogs on muddy ground covered with feces, warehouses piled with skinned carcasses, bags of fox and raccoon dog legs prepared for shipment to southern China, and a rudimentary oil refining shed where fat from carcasses is mixed into oil used in animal feed.  screenshot from video by The Paper The video focused on fraudulent sale...

China's first customs data for 2025 feature a 97-percent decline in corn and wheat imports from a year earlier. Soybean imports were up slightly by volume (but down in value), and dairy, pork, poultry, and seafood imports rebounded year-on-year. Life was less sweet in China with a 93.7% decline in sugar imports, and drinking appears to be up as wine and beer imports posted gains.   China's agricultural imports for January-February 2025 were down 14.7 percent from a year earlier. The value of farm and food goods imported for the first two months of 2025 totaled $30.7 billion, down $5.26 billion from the same period in 2024. China's exports of agricultural products during January-February totaled $15.2 billion, up $393 million from a year earlier.  Data from China Customs Administration website. As usual, soybeans were the largest component of China's agricultural imports during January-February 2025 with a value of $6.3 billion. Meat imports were valued at $4.1 billion, ...

A clamp-down on China's grain imports since last year has more to do with Chinese officials' anxiety about low grain prices than trade war posturing. Officials in China worry that low prices could undercut two of this year's goals for rural policy. Low prices could erode production incentives ahead of spring planting--resulting in a decline in grain output--and lead to a recurrence of rural poverty--which Xi Jinping claimed to have conquered 5 years ago.  An article last week in  Farmers Daily --the communist party's mouthpiece on farm issues--described how Chinese authorities are coordinating a clamp-down on grain imports with domestic market interventions to boost grain prices. All the elements in the article matched paragraph 7 in the party's "Central Document No. 1" section on agricultural supply management without referring to the document. Farmers Daily celebrated a sharp drop in grain imports that began last summer. After tailing off during the fir...

High egg prices are a hot topic in the United States. China, in contrast, has a glut of eggs and depressed prices.  The March 14, 2025 USDA Agricultural Marketing Service weekly eggs market overview reported that U.S. egg prices continued declining during the second week of March as the supply situation improved. No significant highly pathogenic avian influenza (HPAI) outbreaks have occurred in March and U.S. egg demand is relatively light. The average U.S. wholesale price for Grade A large white eggs was $4.15 per dozen, down sharply from their February peak.  Until 2021, Chinese and U.S. wholesale egg prices had been roughly equal at about $1-to-$2 per dozen with no trend. U.S. prices fluctuated more than Chinese prices, so the U.S. price was sometimes higher, sometimes lower than the Chinese price after converting them to dollars per dozen.  Chinese prices converted using monthly exchange rate and assuming 0.6 kg per dozen. Sources: USDA and China Ministry of Agricult...

At  a symposium on agricultural foreign investment held by China's Ministry of Agriculture and Rural Affairs  (MARA) this week companies complained about financing difficulties, limited market access, and lack of information about laws, policies and market environments in target countries.  The meeting was attended by representatives of 42 Chinese companies engaged in seed, livestock, fishing, and crop production, as well as officials from powerful government organizations such as the National Development and Reform Commission, Ministry of Commerce, the Foreign Ministry, and various MARA offices and government-affiliated units. Presentations by state-owned grain trader COFCO and seed producer Zhongnongfa Seed Group discussing their experiences and difficulties were featured.  According to MARA's description of the meeting, agricultural enterprises have overcome difficulties in recent years and played an important role in building China's "Belt and Road", building ...

Discussion of agriculture has not been prominent at China's "two sessions" this week. The emphases were on raising money for stimulus through bond issues, boosting lending by state banks, stimulating consumption, supporting advanced industries (biological manufacturing, quantum technology, 6G, AI+), addressing local government financial problems, solving the property market crisis, "green development," private enterprises, and higher education. In his "Minister's Channel" press conference discourse on food security , Minister of Agriculture and Rural Affairs Han Jun reported that China had produced more than 700 million metric tons of grain last year despite drought and typhoons. Minister Han went on to stress the importance of raising yields through science and technology and implementing policies to ensure grain is profitable and prices are reasonable. He noted that grain supply and demand is overall in tight balance, but China has a persisting d...

China reported that 308.8 million metric tons (mmt) of last fall's grain crop had been procured as of the end of February 2025. This is more than twice the amount procured a year earlier. The announcement in State media did not mention the huge increase nor explain how such an unprecedented increase in grain procurement was achieved.  Economic Daily reported that procurement by all types of enterprises included 105 mmt of rice, 190 mmt of corn, and 10 mmt of soybeans.  The State Administration of Food and Commodity Reserves reported  only the total procurement of 308.79 mmt of fall grain with no data for individual grains except mentioning that 7.11 mmt of middle and late rice was procured through the minimum price program.  In past years the Administration regularly reported procurement progress statistics for each type of fall grain from October through April 30 on a monthly or 10-day interval. But this year only 3 monthly reports have been posted at the end of D...

China's official list of U.S. agricultural products subject to 10-percent additional tariffs announced March 4, 2025 is much broader than reported in yesterday's post on this blog. The list of products targeted for 15-percent tariffs is unchanged. Tariffs will go into effect March 10, 2025, according to the announcement. The 10-percent tariff product list includes 711 tariff lines that cover most major U.S. agricultural exports to China. In addition to the soybeans, sorghum, beef, pork, and offal reported yesterday, additional 10-percent tariffs will be applied to fish and seafood (fresh, frozen, and processed products), most dairy products, vegetables, fruit, nuts, potato flour, fish oil, and processed nuts, fruits and vegetables. The 10-percent tariff list does not include whey, alfalfa, peanuts, vegetable oils, grass seed, vegetable seeds, live plants and flowers, live animals, turkey, guinea hens, lamb, ginseng, honey, pet food, distillers grains, fish meal, or leaf tobac...

China sent its agriculture minister to the inauguration of Uruguay's President Yamandú Orsi in Montevideo. Why would China send its agriculture minister--in office for less than a year--to the inauguration of an important Latin American ally? A ccording to State media , Minister of Agriculture and Rural Affairs Han Jun was appointed as Xi Jinping's special envoy to the March 1 inauguration. Minister Han met with President Orsi at the presidential palace to convey greetings and best wishes from China's leader. (The Uruguay trip explains why Minister Han was absent from a prominent meeting to discuss China's seed industry held the same day as the inauguration.) President Trump chose  Alabama Senator Katie Britt to attend the inauguration. Several South American countries sent their presidents, as did Armenia. Germany sent its low-profile president Frank-Walter Steinmeier. Minister Han Jun Senator Katie Britt Orsi has promised a leftward shift from previous...