Dim Sums: Agricultural Markets in China

China has opened its market to Brazilian distillers dried grains (DDG), a co-product of distilling fuel ethanol from corn that is a cost-efficient ingredient in animal feed. This will further enhance Brazil's dominance as a supplier of China's agricultural imports. China was once a big market for U.S. DDG, but those sales were diverted to other countries after China hit them with steep duties. Exports of Brazilian DDGs to China are expected to grow at a rapid pace. Brazil's corn-based ethanol production has been growing rapidly, and the Brazilian industry has been eager to gain access to China's market for its DDG coproducts.  According to S&P Global  Brazil's industry has been working hard to gain access to China's market. A Brazilian official told S&P Global, "[W]e continue to push forward with a major goal: opening up the Chinese market, ensuring even more sustainability for this sector." An estimate circulated in news media  forecasts that ...

China has agreed to open its market to Brazilian distillers grains and peanut meal with a sanitary and phytosanitary protocol between China's General Administration of Customs and Brazil's Ministry of Agriculture and Livestock announced today. Distillers grains produced from Brazilian corn and meal produced from Brazilian peanuts that meet requirements specified in the agreement can be imported to China as of the date of the announcement.  Both products are used as ingredients in livestock feed.  Distillers grains are co-products of corn ethanol production, including distillers dried grains (DDG) and distillers dried grain with solubles (DDGS). Brazil produced an estimated 4.2 million metric tons of distillers grains in 2024. China was the largest export market for U.S. DDGS with 6.5 million metric tons exported in 2015. Exports were redirected to other markets after China assessed antidumping and countervailing duties on U.S. DDGS in 2016. In 2024 the United States exported ...

Reports of serious drought and pictures of parched fields have circulated on China's internet over the past two months. While Chinese officials acknowledge drought impacts, they insist the wheat crop now being harvested will be normal. We'll have to wait for market prices and imports to reveal whether drought has meaningful impact on China's supply of wheat--the main crop harvested during the summer months. An April article on Chinese social media observed that many reports of serious drought bubbling up around the country conflicted with the agriculture ministry's pronouncement that a "strong foundation had been laid" for a bumper harvest of summer-harvested crops. At the same time, that article also observed that posts by online influencers in China may not be credible either since they have incentive to exaggerate drought problems to attract attention. Whom to believe? Will China resume large imports of wheat after cutting imports sharply last year?  In ea...

Customs data show that China's April 2025 soybean imports were 6.08 million metric tons (mmt), down 29 percent from a year ago and the lowest April volume in years. This follows a March import volume of just 3.5 million metric tons. The low volumes reflect stringent customs inspections that slowed unloading of vessels already at Chinese ports.  China customs administration data The year-on-year decline in soybean imports occurred for both U.S. and Brazilian soybeans. Brazil typically becomes the dominant supplier in April. Customs data showed 4.6 mmt of Brazilian soybean imports and 1.38 mmt of U.S. soybean imports during April 2025. With the shift to Brazilian soybeans inspections have sped up this month and soybean crushers have ramped up operations. Soybean meal prices have dropped from near RMB 4000 in late April to just above RMB 3000 this week. Some feed mills are cutting feed prices due to the reduced cost of soybean meal. Soybean imports are expected to rebound to 12-t...

For decades Chinese leaders have been clamoring to "diversify" imports of agricultural products to reduce reliance on the United States. Having experienced the trade war with China 7 years ago, U.S. commodity producers have also declared their eagerness to diversify their export markets. Both diversifications are tough going because Brazil is the only real alternative supplier with capacity to supply China's gargantuan import needs. Likewise, alternative markets are not large enough to absorb the volume of U.S. soybeans sold to China.  China has been importing enormous quantities of Brazilian soybeans. In calendar year 2024 China boosted its imports of Brazilian soybeans to nearly 75 mmt--over 70% of the total. China imported only 22 million metric tons (mmt) of soybeans from the U.S. last year, but it's hard to see how those beans could be replaced. No other country shows signs of sustained growth as a soybean supplier to China. Imports from Argentina have been up an...

China says it is prepared to decouple from the U.S. in agricultural trade as it "diversifies" its trading partners, but this “opportunity” comes with some “risks.” On April 23, a bombastic Chinese news article cited purchases of 40 cargoes of Brazilian soybeans to prove that “ Americans Need to Know: Chinese People are Really Not Afraid of Decoupling from the United States .” The article asserted that the United States would be harmed more than China by decoupling and insisted that American farmers are “desperate” and “the public is panicking.” On April 13 " Chinese Soybeans Take the Lead in Decoupling and Supply Chain Reconstruction Under Trade Friction " announced that China is ready for "complete decoupling." This article also boasted that China is expanding domestic soybean production and claimed that Brazil is a "safer and more friendly partner" with cheaper soybeans that purportedly have a higher oil and protein content and fewer impuri...

China's April soybean imports totaled 6.08 million metric tons (mmt), according to customs data. While this volume was 2.5 mmt higher than the previous month, Chinese market participants had been expecting 8.5 million metric tons after large purchases from Brazil  according to analysis by China's Soybean meal forum . This was the lowest April import volume in the last 10 years. Customs clearance of soybeans has been slowed by border inspections. It is estimated that 2.4 mmt of soybeans arriving at Chinese ports are still stuck in customs clearance. With tight supplies of soybeans many processing plants are idle. Trucks are reportedly lined up waiting for soybean meal supplies they can deliver to feed mills.  Earlier this week Chinese authorities announced they had lifted bans on soybean shipments from 5 Brazilian suppliers: ADM, Cargill, TerraRoxa, OlamBrasil, and C. Vale. These exporters had been suspended early this year due to "sanitary issues" involving pesticide...

Brazilian authorities approved a Chinese company's genetically modified soybean seed to be grown in Brazil. Chinese company DBN (Da Bei Nong) described this as a strategy to supply seeds for growing South American soybeans exported to China, thus capturing more value from the supply chain. DBN dreams of making money from seeds, but most of its income comes from selling animal feed and pigs in China. According to DBN, its genetically modified soybean variety that combines herbicide-tolerant and pest-resistant traits passed a safety evaluation by Brazil's National Biosafety Technical Committee. The two events DBN9004 and DBN8002 were approved for planting in Brazil in 2023 and 2024, respectively.  DBN said the company now has to gain approval of the variety in "importing countries"--that would include China--before the seeds can be planted commercially in Brazil. China requires that a new round of testing and evaluations be conducted before GMO varieties can be approve...

Chinese market regulators have launched crackdowns on adulteration and fraud in cooking oil and meat industries. Chinese authorities have claimed to have solved these food safety and fraud problems on multiple occasions over the past 30 years.  Fraud and adulteration in China's cooking oil industry will be the focus of a crackdown announced by the State Administration of Market Supervision and Regulation  that began April 12 and will continue through December 2025. The rectification will address prominent problems and illegal business behavior that threatens the quality and safety of edible oils, including: Adulteration and counterfeiting, including the sale of cheap oils as premium oils and passing off expired oils as new product. Excessive use of additives such as flavorings, fragrances, and pigments during the production and processing of vegetable oils. False labeling: unlabeled oils or products that inaccurately declare proportions of blended oils, failure to clearly labe...

A recent study tour of southwest China's rapeseed oil industry shows how developments in global markets filter down to the country's hinterland. The prospect of tariffs on Canadian canola has prompted companies to stockpile canola seeds and oil, while companies are relying on an expected influx of Brazilian soybeans to ease tight supplies of soybean oil. Meanwhile, demand for rapeseed meal used in fish farming has dropped as unwanted tilapia fish are piling up. Soybeans get the most attention, but rapeseed is the second-largest segment of China's edible oil supply. Unlike soybean oil (derived almost entirely from imported beans), rapeseed oil is produced from three sources: crushing domestic seeds, crushing imported seeds, and refining imported rapeseed oil.  Estimated from Ministry of Agriculture, China Agricultural Supply & Demand Estimates (CASDE) and USDA's PS&D database. China imports all of its palm oil. The country produces peanut and cottonseed oils fro...