Soybeans are loaded into a grain cart during harvest in the US state of Illinois in 2018. Photo: VCG

About 66 percent of Chinese fodder enterprises had resumed their production as of Monday, indicating that China’s demand for US soybeans may rise again after the country vowed to buy tariff-free soybeans from the US in the phase one trade agreement, said agriculture insiders. 

Among the nation’s 9,711 fodder enterprises, 6,384 of them have restarted their production amid the battle against the novel coronavirus pneumonia (COVID-19) outbreak, Yang Zhenhai, head of the animal husbandry and veterinary bureau under the Ministry of Agriculture and Rural Affairs, said at a press conference on Tuesday. 

“The ratio of [fodder] firms’ operation still has a gap if compared with the same period in previous years. The total feed supply is abundant, but the main difficulty is traffic disruption,” Yang noted, adding that the ministry will put greater effort into solving the problems and promote full production resumption. 

Amid the epidemic outbreak in China, the recovery for its hog production boosted the demand for fodder, so it is possible that China’s demand for US soybeans will firm up, Li Guoxiang, a research fellow at the Rural Development Institute of the Chinese Academy of Social Sciences, told the Global Times on Tuesday. 

As long as the US does not raise soybean prices, China will buy the US soybeans because of its strong domestic demand, Li noted, adding there is potential for China’s soybean imports from the US to reach a peak in 2020.

“China's soybean purchases from the US this year may be close to or even more than the record of more than 36 million tons in 2016/17, but large quantities of purchases may not appear until the second half of this year,” Zhang Xiaoping, country director for China at the US Soybean Export Council (USSEC), told the Global Times.

Zhang noted that the aquaculture, feed, and soybean crushing industries will all be affected, but if the epidemic can be effectively controlled in the first quarter – originally the low season of demand – subsequent growth will make up for these losses. 

In December 2019, China's soybean imports were 9.54 million tons, a surge of 67 percent year-on-year, according to China Customs data. 
According to Zhang from the USSEC, in January this year, the US exported 1.66 million tons of soybeans to China.

“The amount of soybean imports and exports is more of a political game between China and the US,” said Jiao Shanwei, editor-in-chief of cngrain.com, a website specializing in grain news.

He predicted that the process for China’s buying of US soybeans will have twists and turns in 2020, with an overall import number surpassing last year’s, but with little hope of hitting a record high. 

According to the US Department of Agriculture on Saturday, private exporters reported export sales of 126,000 metric tons (138,890 tons) of soybeans for delivery to China during the 2019/2020 marketing year. The marketing year for soybeans started from September.