Dim Sums: Agricultural Markets in China

China's State-owned food conglomerate COFCO plans to build the largest soybean processing plant in Brazil , according to an announcement by the company. This is just one piece of a soybean crushing capacity expansion taking place across China, the U.S. and Brazil.  COFCO will more than double capacity of its plant in Rondonópolis from its current 4,500 metric tons per day to about 10,000 metric tons. The facility will be capable of processing 1.35 million metric tons of soybeans annually, to produce soybean oil, meal and 350,000 metric tons of biodiesel. The project is expected to cost about US$400 million and will be complete in 2028.  The plant is located at Rondonópolis, an agribusiness hub in Brazil's west central soybean producing region. According to the Chinese article describing the project, the expansion of crushing capacity in Brazil is expected to allow COFCO to exert greater control over the flow of soy products entering Asian markets, enhance the value of it expor...

China's Hulunbuir State Farm Group signed an agricultural cooperation agreement with Brazil's National Agricultural Society in February 2025. What is this Chinese company with an unpronounceable name? We're likely to see more of these companies in the global agricultural space, so let's take a look at who they are. "Hulunbuir" is a Mongolian name for the district of Inner Mongolia where one of hundreds of Soviet-style state farms were set up in the 1950s to consolidate communist party control over empty parts of the country. Hulunbuir is made up of grasslands that resemble the U.S. Great Plains or parts of Brazil's interior. In recent years these bureaucratic operations have been dressed up as companies with new names like Hulunbuir State Farm Group. Statistics indicate State Farms control 7.2 million hectares of cropland and produce 5-to-6 percent of China's grain output.  One of Hulunbuir Group's farms. Source: Hulunbuir web site . Brazilian news...

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 State media celebrated growing purchases of Brazilian corn as a strategy for breaking the "dominant position" of U.S. corn in China's market. In an October 10 article, " China adjusts corn imports to shift toward Brazil, U.S. loses 'dominant position' ," China's strongly nationalist  Global Times  said, "China is now carrying out corn import diversification to change the excessive reliance on the U.S. as a single supplier." Citing Refinitiv data,  Global Times was thrilled to report that August 2023 imports of U.S. corn were down 83% from a year earlier while corn imports from Brazil went from zero last August to 580,000 metric tons in August 2023. Moreover, Global Times reported that imports of Brazilian corn would rise to 1.22 million metric tons in September while imports of U.S. corn would drop to 70,000 metric tons. China approved Brazilian corn for import late in 2022. Brazilian customs data show that 1 million tons a month ...