More than 205 million bushels of U.S. soybeans have been exported to China, the largest U.S. soybean customer, during the first eight months of the 2000/01 marketing year. That exceeds last year’s total of 191 million bushels. In fact, one out of every four bushels of U.S. soybeans exported this year has gone to China. Six years ago, just 15 million bushels were.
Why have those exports increased so dramatically? China has increased its crushing capacity which increased the need for soybean imports while reducing the need for soybean meal and oil imports. Also, China's economy continues to grow compared with other Asian economies.
"China's per capita income is increasing. As a result, the Chinese people are purchasing higher quality foods, including meat products fed with U.S. soybeans," says United Soybean Board International Marketing Asia
Subcommittee Chair Barry Mumby of Fulton, MI.
Because of the increased meat consumption, China now has to import soybeans to meet the feed needs of its pork and poultry producers. China, which annually produces 500-550 million bushels of soybeans, was a net exporter of soybeans six years ago. Because of rising domestic demand for soybeans, China has become a net importer. Last year, it imported 371 million bushels of soybeans.
In the highly competitive China import market, U.S. soybean farmers have been able to capture more than 50% of the market share. For nearly 20 years, soybean checkoff-funded programs implemented by the American Soybean Association have been promoting the use of U.S. soybeans to China’s pork and poultry industries. During the past three years, checkoff programs have also created soybean demand from China’s aquaculture industry.
"U.S. soybean farmers provide technical assistance to China’s pork, poultry and aquaculture industries on improving the quality of feed and increasing the soybean inclusion rate in the feed," explains Mumby. "U.S. soybean farmers have been able to develop business relationships with Chinese feed processors through these technical assistance programs. Other soybean-producing countries do not provide the technical expertise."
The increase in exports to China has been the most significant factor in the rise of overall U.S. soybean exports, which stand at 817 million bushels with four months remaining in the marketing year. Last marketing year, a record 991 million bushels of U.S. soybeans were exported. At the current rate, it is likely U.S. soybean exports will reach 1 billion bushels this marketing year, setting a record for the second consecutive year.
"Since China’s economy shows no signs of slowing down," says Mumby, "the soybean checkoff remains committed to implementing programs that will help grow China's import market and the market share for U.S. soybean farmers."
However, U.S. soybean exports will slow down for the remainder of the marketing year, which ends Aug. 31, as South American soybeans are harvested and become available on the market. Any decline in U.S. soybean exports to China, Mumby says, will be the result of lower South American prices rather than political tensions between the United States and China.