In an interview with the Russian Satellite News Agency, Chinese experts said that China’s October imports of US soybeans soared by nearly 200% year-on-year, due to the release of the backlog of import demand in the first two quarters and the impact of the La Niña weather in Brazil, another major soybean exporter. After Biden takes office, China’s soybean imports from the United States may increase.
According to data released by the General Administration of Customs of China this week, China imported 3.4 million tons of soybeans from the United States in October, a 196.4% increase from 1.147 million tons in the same period last year. China imported 8.69 million tons of soybeans in October, an increase of 41% from the same period last year.
Lu Yue, a researcher at the National (Beijing) Opening-up Research Institute of China University of International Business and Economics, and a professor at the School of International Business and Economics, pointed out that in the analysis of the reasons, the import of soybeans from the United States has risen year-on-year and that China’s economy has gradually recovered after the epidemic.
In addition, according to S&P Global Platts data, nearly three-quarters of China’s imported soybeans come from Brazil, the world’s largest soybean producer and exporter, while the US supplies 12%. The surge in China’s imports of US soybeans in October is also related to the impact of the weather in South America, where Brazil is located.
Previously due to the Sino-US trade friction, the Ministry of Commerce of China formally issued the “Announcement on Imposing Tariffs on Certain Commodities Originating in the United States” in June 2018, announcing that it will impose restrictions on soybeans originating in the United States from July 6, 2018. Imported products of agricultural products will adopt additional tariff measures, with a tax rate of 25%. China’s soybean import tariff rate is generally 3%, which makes US soybeans less competitive than Brazilian soybeans.
However, expert Lu Yue emphasized that in addition to tariffs, the prices of imported products will also be affected by exchange rates. After the Biden administration took office, it was biased towards economic stimulus policies. This result will lead to domestic inflation and help expand exports, including soybean exports. Therefore, China’s imports of soybeans from the United States will continue the existing Sino-US Phase 1 trade agreement program, or it may increase.
Experts believe that whether China will reduce tariffs on imported US soybeans depends on the next trend of Sino-US trade friction.
China and the United States signed the “Economic and Trade Agreement between the Government of the People’s Republic of China and the Government of the United States of America” as the first phase agreement in Washington, USA in January this year. The agreement pointed out that in terms of agricultural products, above the 2017 base, China’s procurement and imports from the United States in the 2020 calendar year will be no less than 12.5 billion U.S. dollars, and in the 2021 calendar year, the procurement and imports from the United States will be no less than 19.5 billion U.S. dollars. According to Reuters news, the U.S. Department of Agriculture said in August that Chinese buyers had signed a contract to purchase 126,000 tons of U.S. soybeans in the 2020-2021 marketing year.
According to the Information Office of the Ministry of Agriculture and Rural Affairs of China, the Minister of Agriculture and Rural Affairs of China Han Changfu said in an interview in September that China is a major soybean producer and the largest consumer of soybeans. In recent years, China’s annual grain imports are roughly 100 million tons. Soybean imports are 89 million tons, accounting for more than 80% of imports.