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China cancels massive import orders! Shipping Logistics | International Logistics | International Freight Forwarders | Guangzhou Freight Forwarders | Panyu Freight Forwarders | Hongde International
Jun 19,2023
China's massive cancellation of grain imports has caused market concern.
"Japan economic news" 12, citing the United States Department of agriculture data reported that,China, the world's largest grain importer, canceled 1.104 million tons of U. S.-made corn that had been scheduled to be imported from late April to mid-May.That's equivalent to 7.4 percent of U.S. corn exports to China in a year.
According to data from Chinese customs, in 2022, US corn accounted for 72% of China's total corn imports, while in the first quarter of this year, this proportion dropped to 37.8, but the United States remained China's number one source of corn imports, followed by Brazil and Ukraine.
According to a recent report on the US Forbes website, China is increasingly aware of the importance of food production and supply.
the japanese economic news reported that,China is moving away from the grain boom to a policy of self-sufficiency in food.. Agricultural policy changes in China, the world's largest food importer, are transforming markets. China wants to increase its self-sufficiency in imports such as soybeans and corn. The Chinese government attaches great importance to food security due to rising food prices and deepening conflicts with the United States.
Japanese economic analyst Hattori Hideki believes that "this is a measure in the general trend of China to reduce its dependence on the United States".
The report also said that, in fact, China has long put forward the policy of attaching importance to food self-sufficiency, "to ensure that the rice bowls of more than 1.4 billion Chinese people are firmly in their own hands".
In order to promote the promulgation of the Food Security Law, China is also speeding up relevant deliberations. In addition, according to media reports, China will increase controls on food imports.
The report pointed out that China's control of grain imports will curb the soaring grain prices, on the other hand, it will also reduce the willingness of foreign producers to farm.
China's basic self-sufficient food is rice, wheat and other staple food, and other food is imported to make up for the shortfall. China's soybean imports account for 59% of the world's soybean imports and 14% of the world's corn imports, both ranking first in the world (according to the data of the United Nations Food and Agriculture Organization in 2021).
Due to the westernization of the diet and other reasons, China's demand for soybeans used for oil extraction has increased, and more than 80% of the soybeans consumed are imported from the United States or Brazil. With the increase in meat consumption, feed with corn is also difficult to fully self-sufficiency. Between 6 and 7 per cent of China's corn demand is imported from countries such as the United States.
On the whole, China's dependence on foreign grain was only about 1% in the second half of the 1990 s, but it has increased year by year, reaching 19% by 2021, the highest level in history.
the report pointed out that,In the past 20 years, China's grain imports have increased several times, which has been a key factor in supporting the international grain market. The balance of supply and demand in the world cereal market may also change if purchases are reduced.
▲ On May 18, in Daying Village, Guyi Town, Xiangzhou District, Xiangyang City, Hubei Province, large machinery harvested wheat in wheat fields. (issued by Xinhua News Agency)
"Nihon Kei Shimbun" reported that the reason why China has changed its dependence on foreign countries for food is that the conflict between Russia and Ukraine has led to rising food prices and the deterioration of US-China relations. There is already trade friction between the United States and China, and the confrontation over the Taiwan issue has deepened.
At present, the spearhead of the United States is mainly directed at cutting-edge technologies such as semiconductors, and agricultural products have not become the focus. However, Kenyono Baizaki, chief research officer of the Agriculture, Forestry and Fisheries Policy Research Institute of the Ministry of Agriculture, Forestry and Fisheries of Japan, believes that "China is quite worried that if it continues to rely heavily on the United States, it will be cut off from food supply due to the intensification of contradictions".
Information from the official website of the Chicago Mercantile Exchange shows that,As the world's major corn importer, China is shifting its import destination from the United States to South America and other places. After Brazilian corn landed in China for the first time in January this year, South African corn also landed in China for the first time in May. China's corn import sources are diversifying.
"Every time China buys, it will have a certain impact on the international market." Ma Wenfeng, a senior analyst at Oriental Aige Agricultural Consulting Co., Ltd., said that in the field of agricultural trade, China has a very obvious "great power effect", and international capital sometimes uses this to speculate on prices. He believes that at present, it is the four major grain merchants in the West that have a direct impact on food prices in the world, and they control about 80% of the global food trade.
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