Dim Sums: Agricultural Markets in China

Four Chinese government departments issued a warning about “cloud-based" farming scams ahead of the lunar new year holiday this week.  The warning posted jointly by the Ministry of Agriculture and Rural Affairs, Bank Supervision authority, public security bureau, and State Administration of Market Supervision alerted Chinese citizens that cloud-based cattle, fish, tea, and vegetable farming frauds have become rampant. The Ministry of Agriculture  issued a similar warning  about cloud-based farming frauds last September. A "cloud cattle farm" in Ningxia Autonomous Region featured on China Central TV ( reposted on Youtube ). One scheme featured in a November article invited investors in Shanghai's posh Xuhui District to invest RMB 5000 to own a cow on an overseas farm with the promise of high returns. Investors were invited to view videos of the farm and monitor their cow's daily life on a video feed. One investor raised his investment to RMB 3 million before he ...

China's agricultural imports declined 7.9 percent during 2024 to reach $215 billion, according to data posted on the customs administration website. The 2024 value was lower than each of the 3 preceding years. Agricultural exports were up 4.1 percent to reach $103 billion. Source: Data from China Customs Administration December reports. The top two agricultural import categories by value both declined. Soybeans ($52.75 billion in 2024) fell 10.9 percent, and meat ($23.38 billion) fell 15.1 percent. Cereal grain imports ($15 billion) were down 28 percent and fish & shellfish imports ($18.5 billion) were down 6.2 percent. Edible oils imports ($10.6 billion) were down 17.8 percent. Fruit, rubber, cotton and wool and beverage imports were up for the year. The decline in value of imports partly reflected a decline in prices. Customs reported that the volume of soybean imports for calendar year 2024 reached a record 105 million metric tons, up 5.6 million metric tons from the previou...

China's Ministry of Agriculture and Rural Affairs has decreed that the country's livestock industry will reduce use of corn and soybean meal in feed as a strategy for reducing grain imports. However, the new decree mostly recycles ideas that have been pushed for the past 5 years...or even longer. The Ministry's "Opinion on Implementation of the Livestock Industry Grain-Saving Action Plan" aims to attack animals' consumption of feed grains and protein meals on multiple fronts. Officials plan to promote adoption of precise low protein diets to cut back on use of soybean meal. The plan calls for fully utilizing non-grain feeds such as corn silage and alfalfa, adjusting the mix of livestock species to minimize feed grain use, boost efficiency, and cut production costs. The plan aims to reduce feed intake per animal by 7 percent from the 2023 level by 2030.  At a news conference a Ministry official indicated the livestock feed action plan is part of the broader gra...

Chinese dairy companies are investing in new facilities in the midst of a steep market downturn according to an article last month in Chinese business news outlet Yicai . The article suggests that the companies are pursuing a new business model, but a deeper dive suggests that addition of new capacity in an industry already suffering from excess capacity is directed by industrial policy to upgrade the industry and protect it from imports. According to Yicai , 2024 was the most difficult year in recent history for dairy companies in China, with weak product demand and fierce price wars. Official statistics say output of dairy products for January-October 2024 was down 2.3% year-on-year.  Despite the shrinking market and sinking prices Yicai observes that "many medium-size regional dairy companies have been quietly expanding production." The article lists examples.  "Adopt-a-Cow" announced opening of a giant 20,000-head dairy farm in Gongzhuling  (a small city in Jili...