Soybean imports to maintain an uptrend

Soybean imports by China are expected to maintain an uptrend in the next 10 to 15 years with growth being driven primarily by the demand from urban residents.

"Soybean imports are expected to grow substantially in the long term propelled by growing demand for oil and livestock feed," said Ma Wenfeng, a senior analyst at Beijing Orient Agribusiness Consultant, a major agricultural consultancy.

According to a US Department of Agriculture forecast, China's imports of soybean are expected to go up by 62 percent to 90 million tons over the next 10 years.

"Soymeal, produced in China largely from imported soybeans, is an integral protein component of the feed necessary to support China's burgeoning pork, poultry and aquaculture industries," said the US Department of Agriculture in its first forecast 2012-13.

"Their rapidly maturing animal husbandry and feed industries, including aquaculture, expansion in crushing capacity and growing consumption of vegetable oils, are all driving demand which cannot be met by domestic supplies."

In recent years, each person in China has been consuming 5 percent more meat, 10 percent more milk, and 8 percent more cooking oil annually compared with five years ago, according to the National Bureau of Statistics.

China is the largest importer of US soybeans, and buys a quarter of the country's soybean production. In February, when Vice-President Xi Jinping made a visit to the US, a Chinese trade delegation signed a deal to buy US soybeans with a total value of $4.31 billion and volume of 8.62 million tons.

The nation became a dominant force in the international soy markets in the late 1990s and is now the world's largest importer and consumer, taking in 55 million tons in 2010, more than 50 percent of the annual global trade. Total soybean consumption has risen 64 percent since 2005, but the self-sufficiency rate stands at about 20 percent, according to Customs.

Ma said it is more efficient for China to import soybeans than to produce them, as soybean production needs more land and water supplies.

"China will be more susceptible to price fluctuations in the international food market with more soybean imports," he said. "But during unfavorable weather conditions, the soybean imports will keep the country insulated from international speculation and food-price fluctuations in the global market."