Written by Stella Meehan from Agriland
A new report projects that China’s soybean imports will slow down and eventually decline through 2030 as a result of slower livestock production growth, continuous improvement in farming practices, and widespread adoption of a low-soymeal inclusion ratio in feed formulas.
China is the world’s largest soybean importer, accounting for over 60% of global trade, with soybean imports mainly driven by crushing for feed production.
Therefore, future imports will primarily be influenced by the outlook for feed demand and the soymeal inclusion rate in feed rations, according to the report compiled by Rabobank.
Lief Chiang, senior analyst – grains and oilseeds at Rabobank said: “We expect that Chinese feed consumption will maintain low single-digit growth.
“However, the inclusion rate of soymeal in feed rations is projected to drop, as the Chinese government is launching a soymeal reduction campaign aimed at lowering the dependence on imported soybeans to ensure food security.”
The report indicates that the reduction of soymeal inclusion in feed will also create opportunities for start-ups to develop new technologies and novel ingredients.
China’s soybean import forecast 2018-2030f. Source: Rabobank 2022
Chenjun Pan, senior analyst – animal protein at Rabobank added: “In a low-soymeal inclusion scenario, extra use of amino acids will be necessary to meet the nutritional needs of animals.”
Chinese amino acid players will benefit, but rising domestic demand might compromise producers’ ability to export and prompt foreign buyers to diversify their supply chains, Rabobank explained.
Low-soymeal inclusion formulas will also bring opportunities to other feed ingredient manufacturers, according to the report, e.g., enzyme application will rise along with rising use of alternative protein meals.
Additionally, there are a number of start-ups focusing on novel feed protein sources, such as insect and microbial proteins.
In the long run, it is expected that these novel proteins will make positive contributions toward saving natural resources and reducing carbon emissions, albeit there is uncertainty about the timeline for these in China.
The report stated that the projected slowdown and eventual reduction in China’s soybean imports will have profound impacts on the entire global supply chain and reshape global trade flows.
According to Rabobank, it will challenge all participants along the chain, including growers, trade merchants, soybean crushers, livestock farmers, feed mills, and feed ingredient manufacturers.
Lief Chang continued: “While China will remain the largest importer, additional growth will shift from China to other regions and mainly be driven by emerging economies in the Middle East, Southeast Asia, and South Asia.
“Merchants will need to realign their business for new destination markets and increase infrastructure investment in these regions.”
Moreover, global soymeal trade volume is projected to increase at a fast pace, the report added.
Driven by rising biofuel demand, the US and Brazil are expected to expand their crushing capacities and process more beans domestically, keeping more soy oil for local use and exporting increasing volumes of soymeal.
After African Swine Fever (ASF) caused a decline in 2019, Chinese feed consumption registered rebounds in 2020 and 2021, according to the report.
The growth was mainly driven by rapid hog herd rebuilding, positive farming margins, and rising penetration of commercial feed during the period.
As the integrated feed-livestock model expanded and industry consolidation continued, in-house feed volumes experienced even higher growth.
In 2021, total feed consumption exceeded pre-ASF levels, reaching 450 million tonnes, of which hog feed, broiler feed, layer feed, and aquaculture feed accounted for 90%.
Source: Rabobank report
For 2022, Rabobank expects feed consumption will have a slight drop of roughly 1% year-on-year, due to broiler and pig herd declines.
Since the sow herd was being built up in the final three months of 2022, it is projected that Chinese feed consumption will go back to its previous growth track in 2023 and beyond.
Also Read: ABP Demo Farm: Cutting meal bills while boosting cattle thrive
The post Report: Chinese soybean imports to decline by 2030 appeared first on Agriland.co.uk.
Continue reading on the Agriland Website...
China is the world’s largest soybean importer, accounting for over 60% of global trade, with soybean imports mainly driven by crushing for feed production.
Therefore, future imports will primarily be influenced by the outlook for feed demand and the soymeal inclusion rate in feed rations, according to the report compiled by Rabobank.
Lief Chiang, senior analyst – grains and oilseeds at Rabobank said: “We expect that Chinese feed consumption will maintain low single-digit growth.
“However, the inclusion rate of soymeal in feed rations is projected to drop, as the Chinese government is launching a soymeal reduction campaign aimed at lowering the dependence on imported soybeans to ensure food security.”
Soybean imports
The report indicates that the reduction of soymeal inclusion in feed will also create opportunities for start-ups to develop new technologies and novel ingredients.
China’s soybean import forecast 2018-2030f. Source: Rabobank 2022
Chenjun Pan, senior analyst – animal protein at Rabobank added: “In a low-soymeal inclusion scenario, extra use of amino acids will be necessary to meet the nutritional needs of animals.”
Chinese amino acid players will benefit, but rising domestic demand might compromise producers’ ability to export and prompt foreign buyers to diversify their supply chains, Rabobank explained.
Low-soymeal inclusion formulas will also bring opportunities to other feed ingredient manufacturers, according to the report, e.g., enzyme application will rise along with rising use of alternative protein meals.
Additionally, there are a number of start-ups focusing on novel feed protein sources, such as insect and microbial proteins.
In the long run, it is expected that these novel proteins will make positive contributions toward saving natural resources and reducing carbon emissions, albeit there is uncertainty about the timeline for these in China.
Global supply chain
The report stated that the projected slowdown and eventual reduction in China’s soybean imports will have profound impacts on the entire global supply chain and reshape global trade flows.
According to Rabobank, it will challenge all participants along the chain, including growers, trade merchants, soybean crushers, livestock farmers, feed mills, and feed ingredient manufacturers.
Lief Chang continued: “While China will remain the largest importer, additional growth will shift from China to other regions and mainly be driven by emerging economies in the Middle East, Southeast Asia, and South Asia.
“Merchants will need to realign their business for new destination markets and increase infrastructure investment in these regions.”
Moreover, global soymeal trade volume is projected to increase at a fast pace, the report added.
Driven by rising biofuel demand, the US and Brazil are expected to expand their crushing capacities and process more beans domestically, keeping more soy oil for local use and exporting increasing volumes of soymeal.
Feed demand
After African Swine Fever (ASF) caused a decline in 2019, Chinese feed consumption registered rebounds in 2020 and 2021, according to the report.
The growth was mainly driven by rapid hog herd rebuilding, positive farming margins, and rising penetration of commercial feed during the period.
As the integrated feed-livestock model expanded and industry consolidation continued, in-house feed volumes experienced even higher growth.
In 2021, total feed consumption exceeded pre-ASF levels, reaching 450 million tonnes, of which hog feed, broiler feed, layer feed, and aquaculture feed accounted for 90%.
Source: Rabobank report
For 2022, Rabobank expects feed consumption will have a slight drop of roughly 1% year-on-year, due to broiler and pig herd declines.
Since the sow herd was being built up in the final three months of 2022, it is projected that Chinese feed consumption will go back to its previous growth track in 2023 and beyond.
Also Read: ABP Demo Farm: Cutting meal bills while boosting cattle thrive
The post Report: Chinese soybean imports to decline by 2030 appeared first on Agriland.co.uk.
Continue reading on the Agriland Website...