Dim Sums: Agricultural Markets in China

Five months ago, one of China's leading pork analysts vociferously denied making a dire prediction that Chinese hog prices would crash during 2026. Prices are now tumbling to levels unseen in decades, and the bearish prediction he had disavowed now appears to have been more or less accurate. Why did he disown a bearish forecast? What does this incident say about the China dream of AI-driven agriculture?  On November 24, 2025, long-time Chinese hog analyst Feng Yonghui posted an article on his soozhu.com web site denying that he had predicted that hog prices would fall below RMB 10-to-11 per kg and stay there during 2026. Mr. Feng disavowed the bearish forecast, calling it a "malicious spreading of rumors."  He blamed an artificial intelligence algorithm for splicing together comments he had made out of context and constructing a misleading assessment that tarnished his reputation.  Five months later, on March 23, Mr. Feng's site reported that hog prices h...

Chinese officials suddenly became very accommodating regarding weed seeds in Brazilian soybean cargoes within days after President Trump announced that he will postpone his summit with Xi Jinping.  Ten days ago this blog reported that vessels loaded with soybeans were stranded in Brazilian ports as they waited for strict inspections to be completed by Brazil's Ministry of Agriculture. New, stricter inspections were prompted by Chinese customs complaints about weed seeds, soybeans coated with insecticides or fungicides, and heat damage. On March 6, Cargill, CHS and COFCO requested clarification from the Brazilian Ministry , and Cargill reportedly suspended purchases of Brazilian soybeans for export to China. According to a March 16 report , offers for Brazilian soybeans for shipment to China had dried up.   A delegation led by the director of the Department of Animal and Plant Health in Brazil's Agriculture Ministry rushed to China for negotiations with Chinese officials on M...

China's agricultural subsidies are cloaked in the language of environmentally friendly benefits for small farmers, but their main purpose is to industrialize agriculture in order to maximize extraction of resources from the land, water, and people of the countryside.  As farmers prepare to plant their crops, China's Ministry of Agriculture and Rural Affairs (MARA) announced this year's list of 16 policy measures to "strengthen, benefit, and enrich the agricultural sector."  Land fertility protection subsidy. An annual payment to villagers who hold rights to plots of collective farmland.  Agricultural machinery purchase and use subsidy.  Wheat spraying with growth promoter, herbicide and antifungal chemicals in the Spring. Corn and soybean intercropping subsidy Corn, soybean and rice producer subsidies Crop rotation subsidy for rotating corn and soybeans in Northeastern region, double cropping winter wheat or rice with corn or oilseeds in other regions, growing so...

Lack of investment is a roadblock to China's vision of a space-age agriculture with automated tractors and barns, internet-linked sensors, sprinklers, and heaters, and "green" recycling and circular systems. A new Chinese agricultural lending program aims to overhaul agricultural equipment and facilities to make a great leap toward high-tech and "green" priorities set by the 15th five-year plan, yet it has received hardly any publicity.  China has several programs to promote investment: an agricultural machinery purchase subsidy, a subsidy for scrapping old machinery, and a program to construct high-standard fields with irrigation, roads and electric infrastructure. Still, China's agriculture produces 6.7% of GDP but only attracted 2% of the country's fixed asset investment in recent years.  On March 9, China's Ministry of Agriculture and Rural Affairs issued a " Notice on Implementation of Policies on Loans for Equipment Upgrading in the Agricu...

Soybean shipments from Brazil are suddenly in limbo because Chinese customs inspectors forced their Brazilian counterparts to adopt a new phytosanitary control system. The disruption comes during Brazil's peak month for soybean shipments bound for China. Is the timing coincidental, or is it another attempt to use phytosanitary concerns to "manage" the flow of imports? Earlier this week, a  Latin American Cargill executive told a Reuters correspondent that Brazilian inspectors had adopted a new inspection system this month. Cargill had stopped buying Brazilian soybeans for shipment to China until they could figure out how to work with the new system. News media have reported that Brazil's agriculture ministry had tightened inspections at the behest of Chinese customs regulators based on reports that inspectors they found problems such as presence of insects, beans coated with pesticides or fungicides, weed seeds, and heat damage in Brazilian beans arriving at the Chin...

Chinese state media announced results of last year's crackdown on fraudulent meat and vegetable oil conducted by China's State Administration for Market Regulation (SAMR). The news issued during the "two session" political meetings in Beijing is surely meant to reassure citizens outraged by rampant reports of premium cooking oil and lamb barbecue diluted with cheap substitutes. A deeper dive reveals that it's impractical to completely eliminate food fraud. According to reports in State media , market regulators held a campaign in 2025 to address public concerns about adulteration, counterfeiting and false labeling of meat products and vegetable oils. During the campaign regulators reportedly inspected 4.55 million meat and cooking oil products across the country, found 461,200 problems, closed 4,297 illegal online stores and accounts, and ordered platforms to delete over 11,000 pieces of false or misleading information. They punished 1708 people, assessed fines of...

China's transition to a more protein-rich diet is evident in food consumption data from its official national household survey. Pork continues to rule the roost despite growth in egg and poultry consumption, and more Chinese consumers now know where to find the beef. Since the 1950s China's National Bureau of Statistics has conducted a household survey of income and expenditure that included per capita consumption/purchases of foods. The household survey historically had some flaws in the sampling (some were corrected in the 2013 overhaul) and it excludes food consumed in restaurants, cafeterias, and banquets, but we'll set those aside for now. The data reflect the key trend driving Chinese food markets: consumption of animal protein is growing while consumption of carbohydrates like rice, flour, buns and noodles is dropping. The changes from 2013 to 2024 indicate a neat symmetry between the two:  Per capita purchases of cereal grains shrank from 138.9 kg to 110.6 kg (-28.3...

One of China's top 2 soybean crushers reported a rebound in profits during 2025 despite the trade war that choked off imports of U.S. soybeans for most of the year. However, the profit report belies a gloomy outlook for China's crushing industry as it awaits another deluge of Brazilian soybeans this Spring. Arawana Holdings Co. Ltd. (known in China as Yihai Kerry) reported a 26% increase in profits in a preliminary report of its 2025 financial performance . Arawana cited improved soybean crushing margins due to strong downstream demand for its soybean meal products and reduced soybean costs during the first 3 quarters of 2025. The report said strong demand for soybean meal was driven by its high cost-effectiveness in feed formulations (thus undermining agricultural officials' plans to eliminate soybean meal from feed formulations). Margins were also aided by ample South American supplies that drove down soybean prices and lowered raw material costs. The report said procurem...