Dim Sums: Agricultural Markets in China

China's relentless growth in exports of the amino acid lysine was finally reversed in 2025. The value of exports fell more than the volume as AD actions by the EU, Brazil and the U.S. hit prices hard in the Chinese industry. Lower prices led to gains in dozens of other markets around the world, but the value of exports was down sharply. Source: China customs data HS code 29224190. Lysine is an essential amino acid that can be used in animal diets for protein synthesis to improve muscle growth and feed efficiency. China imported lysine and other amino acid feed supplements until the early 2000s, but China now produces an estimated 70% of the world's amino acids. In addition to lysine, China exports threonine, tryptophan, and methionine.  China has the world's largest livestock herd, and China's agriculture ministry has been promoting domestic use of amino acids as a means of reducing use of soybean meal in animal diets. Yet domestic demand for lysine has been less dynami...

The Fufeng Group's acquisition of a 300-acre site in North Dakota to build a corn processing plant is routinely cited as proof that "China" has a plot to buy up American farmland. Fufeng's project was denied approval by Grand Forks officials  based on concerns about spying, but its North Dakota land purchase became part of the narrative has led to growing restrictions on Chinese land ownership in the U.S., including yesterday's announcement of a National Farm Security Initiative at USDA headquarters attended by multiple cabinet secretaries.  Since we're going to create a new national security policy based on our fear of such companies, maybe we should investigate who Fufeng is and what they're up to. You probably have never heard of Fufeng Group (pronounced foo-fung), a company with 17,000 employees headquartered in Qingdao China that manufactures food and agricultural chemical products by fermenting corn. You may have heard of Fufeng's main product, ...

Chinese officials claim that livestock producers are substituting amino acids for soybean meal in animal feed, reducing China's reliance on imported soybeans. A spike in China's exports of the main amino acid is inconsistent with these claims. China has built massive amounts of processing capacity to produce lysine--the most common amino acid--from corn (the main raw material). China is now the world's dominant lysine producer and exporter. Yet a November 2023 report by China's Mysteel agricultural market site said production of lysine is less than half of China's production capacity. Mysteel said China's amino acid industry suffers from serious excess capacity. At peak output in 2020 Mysteel reports that China used 11 million metric tons of corn to produce lysine and other feed additives. Since then production has slipped to 8 million metric tons in 2023 due to weak feed demand and high corn prices. This does not agree with proclamations from Chinese officials...