According to the Voice of China Rural Village in China, the Deputy Minister of Finance Zhu Guangyao stated at the briefing of the China New Zealand Office on the afternoon of the 4th that farmers in China planting soybeans appealed to relevant associations and stated that the US government’s subsidies have affected It is in the interest of planting soybean farmers in China. The Chinese government must respect the demands of Chinese farmers and respect the policy appeals of the China Soybean Association, so it chose soybean as an option for counter-measures.
China and the United States are the largest consumers and largest producers of soybeans in the world. Soybeans were included in the list of tariffs, which immediately triggered strong market response. Zhang Zhuo, an analyst at Zhuochuang Information, pointed out that the increase in tariffs will have a profound impact on the production and export of US soybeans. Soybean industry in China and other countries will usher in more opportunities for competition.
Zhang Lanjie: Before this, China imposed a 3% import tariff on U.S. soybeans. Once 25% is imposed, such a large threshold will certainly bring about a series of changes to the U.S. soybean market.
First of all, the futures market is not calm. After the news that a 25% tariff was imposed on US soybeans, US soybean futures on the Chicago Mercantile Exchange tumbled 4% and had fallen below 1,000 cents. The decline in the main US soybean meal futures fell by more than 3%, while the US corn futures fell by more than 3%. After the Spring Festival, the increase in supply caused by the supply side was instantly turned into nothing. At the same time, China’s oil plants announced that they stopped all quotations and stopped all transactions.
The American peasants are not calm. The American Soybean Association made it clear that if China takes measures in the soybean sector, many American farmers will lose their ability to earn money and cannot live.
Why has such a large impact on the US soybean levy tariff? Because China is the second largest consumer of agricultural products in the United States, it is also the largest consumer of soybeans. Most of the U.S. soybeans rely on exports, of which about 61% are sold to China. In contrast, according to China’s imports of US beans, from the customs data, China imported about 96 million tons of soybeans in 2017, including about 33 million tons from the United States, accounting for only 34%.
For China’s soybean market, the current price gap between domestic soybeans and imported soybeans is very small, as long as the increase of certain import tariffs is not as high as 25%, domestic soybean prices become very competitive. At the same time, soybeans from Ukrainian soybeans, Russian soybeans, and other countries will also face good news. The market price of soybeans and their surrounding products is likely to rise in a short period of time.
For growers and processors, if you understand the production of feeds for each breed, you can know that there is currently no feed that can replace soybean meal, so try to analyze it from the perspective of increasing soybean supply – 2017/18 China’s soybean planting area is about 120 million mu, due to the lower unit benefit of soybean planting in China, and at the same time, due to the increase in the price of soybean meal, the proportion of corn to be added will increase, and the demand for corn will also increase. Therefore, soybeans are greatly expanded in China. The possibility is low. It is suggested that growers always observe market changes and rationally formulate planting plans.
