China's Soybean Harvest May Rise, Cutting Imports (Update3)
April 9 (Bloomberg) -- Soybean production in China, the world's biggest importer of the oilseed, may rise 9.1 percent this year, twice the rate of consumption, cutting imports from the U.S. and Brazil.
China's soybean harvest may rise to 18 million metric tons from 16.5 million tons in 2003, said Zhang Zhaoxin, an analyst at the agriculture ministry. Domestic consumption may rise 4.7 percent to 35.9 million tons from 34.3 million tons, he said.
Increased local production may stem China's soybean import bill, which soared to about $4.2 billion last year as dwindling supply from the U.S., the biggest exporter, pushed the price of soybean futures on the Chicago Board of Trade up 41 percent.
``This year, domestic production will be better able to satisfy demand from soybean crushers'' who make oil and meal, said Hu Liangtian, Tianjin-based marketing manager for Tianjin Huifeng Trading Co.
Higher soybean prices have prompted some Chinese farmers to switch to soybeans from corn in the country's northeastern provinces, where most of the two crops are grown. The area planted with soybeans in China this year may rise by 9 percent to 11 million hectares (57 million acres), while corn acreage may fall by 2 percent to 23 million tons, according to data from the country's State Grain Administration.
Crushing
Based on current prices, farmers can make a 52 yuan ($6.30) profit on each ton of corn grown, less than a third of the 162 yuan they can make on soybeans, according to a report last week from the administration.
China's soybean crushing capacity will increase 1 million tons to 27.4 million tons in 2004, Zhang said. Growth in factory capacity to crush the beans is slowing as the increase in soybean prices discouraged millers from expanding their plants.
Millers in China have the capacity to crush 27.4 million tons of soybeans in 2004, up from 26.4 million tons last year, according to Zhang from the agriculture ministry. Capacity rose 5.6 million tons between 2002 and last year.
The government may import about 20 million tons of soybeans this year, Zhang said. That's little changed from shipments for 2003. Last year, soybean imports by China jumped 83 percent to 20.7 million tons, according to the China National Grain & Oils Information Center.
To contact the reporter on this story:
Rob Delaney in Beijing at robdelaney@bloomberg.net. |
