China’s pig production is still growing, a farm ministry official said Oct. 23, and a higher-than-normal number of breeding sows is set to maintain downward pressure on prices.

China had 42.4 million sows at the end of September, unchanged from the previous month, and 3.4 per cent higher than the normal level, Chen Guanghua, head of the animal husbandry and veterinary bureau at the Ministry of Agriculture and Rural Affairs, said at a press briefing.

Production efficiency of sows is also improving, with each sow breeding 0.5 more piglets compared to the previous year.

Chen added that, while prices may rebound in the fourth quarter, which is the peak consumption season, “there is no basis for a sharp rise.”

Farmers have increasingly raised pigs to heavier weights, which will add to November supply, said Chen.

Supply could increase after the Chinese New Year in February, when there could be a decline in consumption as well as an increase in slaughter volumes.

“The level of pig losses may even be greater than that of the same period this year,” he said, urging farmers to adjust their production.

China’s grain output is also set to grow, thanks to an expected additional 1.15 million acres planted with autumn crops, said Pan Wenbo, director of the planting industry management department, also speaking at the briefing.

Total autumn grain acreage is set to reach the equivalent of 214.98 million acres, he said.

The increase is due to switching from cash crops to grain, as well as more intercropping and some land being returned to farming, he said.

The post Few improvements expected in Chinese hog market appeared first on Manitoba Co-operator.

China’s Ministry of Commerce said Aug. 4 that anti-dumping and anti-subsidy tariffs on Australian barley would end the following day, roughly three years after the 80.5 per cent duties first cut off what was once as much as a C$1.32-billion annual trade and led Australia to file dispute at the World Trade Organization.

The barley decision follows resumption of trade in products like coal and timber and puts a spotlight on the few remaining Australian products restricted by China, including wine, which also faces tariffs, and unofficial restrictions on lobster and meat exports from certain abattoirs.

Australian Trade Minister Don Farrell said Aug. 4 that Chinese restrictions, which had affected roughly $17.62 billion of annual trade as of last May, had shrunk to hit about $1.76 billion of exports.

“We intend to use this process [barley] as a template for resolving the issue in respect of wine, which is still ongoing … as we seek to resolve all of those outstanding issues,” Farrell said.

Relations between the two major commodity trade partners had deteriorated in 2020 after Australia called for an inquiry into the origins of COVID-19, triggering reprisals by Beijing.

Tensions have eased since the centre-left Labor party won power in Australia last year, with Chinese purchases of Australian coal and timber resuming this year.

Chinese buyers turned to Canada, France and Argentina to replace Australian barley supplies over the last three years, while Australian sellers shifted exports to feed barley markets in the Middle East.

Those trade flows are likely to shift again after China drops the tariffs, with its barley buyers expected to begin purchases of the new Australian crop harvested in October for arrival by year-end.

The barley decision also smooths the way for a potential trip to Beijing later this year by Australian Prime Minister Anthony Albanese, although no date has been set.

Australia’s wine trade with China was once worth $1.06 billion annually, according to industry group Australian Grape & Wine, whose CEO Lee McLean said the end of the barley tariffs was a positive step.

The Australian government said it would end its barley dispute at the WTO, but had not yet dropped a separate complaint against China’s tariffs of up to 218 per cent on Australian wine.

Barley market shifts

Rabobank senior grains analyst Dennis Voznesenski said the barley decision would be positive for Australian prices and farmers with malt quality barley were especially likely to attract a premium over recent prices.

“Market players who are going to be shipping barley to China may ask for a premium due to risks involved, as there are going to be some concerns if, for example, China goes back on its decision,” he said.

Grain Producers Australia CEO Colin Bettles welcomed the removal of tariffs, calling it a win for Chinese consumers and industry as well as local exporters.

The post Australia calls for China to end remaining trade curbs appeared first on Manitoba Co-operator.

About 200,000 people and 760,000 large livestock do not have access to sufficient water as of the last week of June, Xinhua reported, citing China’s Ministry of Water Resources. 

Affected areas are mainly in the northwestern region of Inner Mongolia, known for its grasslands that feed sheep and cattle, as well as northern Hebei province and northeastern Liaoning, both important corn and dairy areas. 

Chinese capital Beijing topped 40 degrees Celsius on June 24 for a record third day, as rare high temperatures for June grilled an area the size of California in northern China. 

Parts of nearby Hebei, Henan, Shandong, Inner Mongolia and Tianjin either raised or kept their hot weather alert at “red,” the highest in the country’s four-tier warning system. 

Southwestern Yunnan, which has already endured months of drought since last year, is also facing water shortages, according to the Xinhua report. 

The high temperatures eased June 25, but were expected to return later that same week, possibly rising above 40 C again in Beijing, Tianjin and southern Hebei, the state broadcaster CCTV said June 26. 

Parts of eastern Jilin and eastern Liaoning, northeastern corn-growing provinces, were set to see heavy rain in the last week of June, the broadcaster reported. 

Meanwhile, many areas in the south of the country received heavy rainfall between June 25-26, including southern Guangdong province, eastern Zhejiang and Shanghai. Those rains caused flooding in 15 rivers, said the Xinhua report.

The post Northern China drought-wracked appeared first on Manitoba Co-operator.

Soybean arrivals into the world’s top buyer have been running at record levels since the start of the year, after a record crop in Brazil pushed down prices of the animal feed protein.

Chinese customs data shows imports are up 11 per cent January to May compared to a year ago. That’s still set to rise as more than 11 million tonnes reaches ports this month, said two Beijing-based traders and commodities consultancy Zhouchuang.

That is well above last year’s 8.25 million tons, though slightly lower than the record 12 million tonnes in May.

The surge will continue in July, with another 11 million tonnes, beating last year’s 7.88 million tonnes, and another 10.5 million tonnes in August, the two traders said.

Chinese buyers took advantage of bargain prices to stock up after smaller imports than usual in late 2022 and in anticipation of rising demand from farmers after China’s reopening from strict COVID-19 measures.

Demand has not increased, however, and soymeal demand is under pressure after months of losses for hog farmers that is set to extend into summer when hot weather curbs meat consumption, keeping hog prices low.

Animal feed makers are keeping soymeal stocks to a minimum as the poor hog margins drag on, said Rosa Wang, analyst at Shanghai JC Intelligence, reducing crushers’ forward sales and impacting their soybean purchases.

If demand is very weak, the feed producers could cancel soymeal contracts, Wang added.

The post Soybean influx into China cools buying appetite appeared first on Manitoba Co-operator.

The sale of the unit, known as Cargill Protein China, is subject to regulatory approvals but is expected to close this year, Cargill said in a statement May 31.

It did not give a transaction price and DCP Capital declined to comment on the deal.

China is the world’s second largest poultry producer after the United States, producing about 19 million tonnes of chicken last year.

Cargill, one of the top poultry producers in the U.S., started its China poultry business in 2011, breeding, raising and processing chickens in Chuzhou in the eastern Anhui province. In 2019, it added a US$48.8 million plant to the operations, which can process 65 million birds annually.

Livestock farm margins in China have been squeezed in the last two years as the war in Ukraine drove up feed prices, and weakened demand during the pandemic depressed meat prices, said Juhui Huang, an agribusiness consultant at Beijing Means Consulting Co.

“Local companies in China are generally better in managing their costs and more flexible in sales strategies like payment terms, which makes them more competitive in such a difficult environment,” he said.

Despite the pressures, China’s largest poultry players have continued to expand, far outpacing smaller operations such as Cargill’s.

Wellhope Foods, one of the largest domestic firms, slaughtered 700 million chickens last year and has a goal of processing 1.5 billion birds annually by 2029.

DCP Capital has invested in several other food and agriculture businesses, including another of China’s top poultry producers, Fujian Sunner Development, its website says.

The private equity firm is focused on Greater China and is led by former members of the KKR and Morgan Stanley private equity businesses, according to the website.

The post Cargill to sell China poultry unit appeared first on Manitoba Co-operator.

The soybean, developed by privately owned Shandong Shunfeng Biotechnology Co., has two modified genes, significantly raising the level of oleic acid, a healthy fat, in the plant.

The safety certificate has been approved for five years from April 21, according to a document published in late April by the ministry of agriculture and rural affairs.

Unlike genetic modification, which introduces foreign genes into a plant, gene editing alters existing genes.

The technology is considered less risky than GMOs and is more lightly regulated in some countries, including China, which published rules on gene-editing last year.

“The approval of the safety certificate is a shot in the arm for the Shunfeng team,” said the firm in a May 4 statement to Reuters.

Shunfeng claims to be the first company in China seeking to commercialize gene-edited crops.

It is researching around 20 other projects, including higher-yield rice, wheat and corn, herbicide-resistant rice and soybeans and vitamin C-rich lettuce, said a company representative.

Several additional steps are needed before China’s farmers can plant the soybean, including approvals of seed varieties with the tweaked genes.

The approval comes as trade tensions, erratic weather and war in major grain exporter Ukraine have increased concerns in Beijing over feeding the country’s 1.4 billion people.

A growing middle class is also facing a surge in diet-related disease.

China is promoting GMO crops too and is starting large-scale trials of GM corn this year. Getting gene-edited crops onto the market is expected to be faster, however, given fewer steps in the regulatory process.

United States-based company Calyxt also developed a high-oleic soybean, the first gene-edited food to be approved in the U.S. in 2019. Japan has also approved gene-edited foods.

The news comes as the Canadian Food Inspection Agency revealed its new guidance on gene-edited seeds. On May 3, the agency said gene-edited seed would face the same regulations as conventionally bred seed.

The post China approves safety of first gene-edited crop appeared first on Manitoba Co-operator.

The world’s top soybean importer launched a major effort to increase production of the pulse in 2022 amid concerns over its heavy reliance on imports. Output increased almost 24 per cent to 20.3 million tonnes that year.

However, an official from China’s Ministry of Agriculture and Rural Affairs said farmers were less willing to plant more of the crop in 2023.

“Frankly speaking, due to the low soybean market price and low comparative benefit, the enthusiasm and willingness of farmers to plant soybeans has declined compared with this time last year,” Pan Wenbo, director general of the ministry’s Department of Crop Production, told a press briefing.

After offering a package of incentives, including significantly higher subsidies to plant soybeans compared to corn in key growing areas in the northeast, planting intentions had improved, he added. However, any national increase is expected come from other regions where a campaign to promote intercropping with corn is underway.

Compound planting of the two crops is expected to increase slightly. Just over 3.2 million acres are expected to utilize the practice this year, Pan said.

As a result, he expected the country’s soybean acreage to be stable or slightly increase in 2023.

China’s homegrown soybeans are used for food, while imported genetically modified beans are crushed into meal for animals and oil for cooking.

China’s hog farmers are set to make profits by the end of the second quarter as feed prices fall and consumption picks up, another official said at the same briefing.

Hog prices in the world’s top pork producer have slumped this year, weighed down by the largest quarterly slaughter volume in five years, data showed in the third week of April.

But consumption is due to improve during the upcoming Labour Day and dragonboat festival holidays, said agronomist Zeng Yande.

He added that a sow herd of 43.05 million pigs as of the end of March was still within a reasonable range for the country. The number is 0.9 per cent lower than February but higher than the ideal herd size of 41 million.

Zeng also said the disease situation in the country’s hog herd was “generally stable,” and described recent reports of disease outbreaks in the north as “hype.”

The post Little Chinese soybean growth predicted appeared first on Manitoba Co-operator.

The new plan proposes soymeal ratios in animal feed should be reduced to less than 13 per cent by 2025, from 14.5 per cent in 2022.

Authorities in the world’s top soybean importer already issued guidelines in 2021 to its animal feed industry recommending lower soymeal ratios.

The new plan would “guide the feed industry to reduce the amount of soybean meal, promote the saving and consumption reduction of feed grains, and contribute to ensuring the stable and safe supply of grain and important agricultural products,” said the document, published by the Ministry of Agriculture and Rural Affairs.

Some say the plan could have a big impact. China could reduce soymeal consumption by at least three million tonnes a year, said Liu Bing, an analyst at Donghai Futures.

Imports could drop to 82 million tonnes by 2025, he said, with feed makers using more rapeseed, sunflower seed and synthetic protein as soymeal substitutes.

However, lower soybean imports would result in less soyoil production, requiring more palm oil imports as compensation, Liu added.

Jim Sutter, chief executive at the U.S. Soybean Export Council, said he was not worried about a significant drop in imports.

“I think we’ll see strong demand continuing. There’s a limit as to how much soy can be taken out of rations,” Sutter said during a visit to Beijing.

The new target of under 13 per cent by 2025 is slightly lower than an earlier target of 13.5 per cent, but the direction is not new, said Lief Chiang, senior analyst at Rabobank.

“The whole point is to build a more resilient supply chain amid geopolitical risks,” he said.

China buys more than 60 per cent of the world’s traded soybeans, well over 90 million tonnes a year, largely from the United States and Brazil.

“On the one side, they would like to lower the absolute volume of soybean imports, but meanwhile as a contingency, they want to diversify and lower their dependency more, particularly on the United States,” added Chiang.

The push for lower soymeal use has so far been successful, helped in large part by soaring prices of the protein-rich ingredient in recent years, which has pushed feed makers to scale back its use.

Rabobank estimated in January that the ratio could drop to 12 per cent by 2030, lowering China’s soybean imports to 84 million tonnes.

The post Food security drives China to cut soymeal use in animal feed appeared first on Manitoba Co-operator.

Relations between the two had been strained for years, and worsened after Australia called for an inquiry into the origins of COVID, triggering trade reprisals by Beijing including anti-dumping duties on Australian wine and barley.

But tensions have eased since the centre-left Labor party won power last year in Australia. Foreign Minister Penny Wong met her Chinese counterpart Wang Yi in Beijing in December, the first such visit by an Australian minister since 2019.

Chinese purchases of Australian coal resumed in January after almost three years, and imports of beef have accelerated.

Wong said Australia would suspend a case at the World Trade Organization (WTO) over China’s anti-dumping and countervailing duties on barley, while China hastens a review into the tariffs.

“China has agreed to undertake an expedited review of the duties imposed on Australian barley over a three-month period, that may extend to a fourth, if required,” she told a news conference.

“In return, we have agreed to temporarily suspend the WTO dispute for the agreed review period.”

The government expects a similar result in a second dispute on wine tariffs, she added.

Barley rebalancing

China’s ministry of commerce, which had imposed the barley tariffs for a five-year period, later confirmed it had reached a consensus with Australia to settle the barley dispute, adding China was willing to work with Australia to address concerns about each other’s industries.

On Monday, meanwhile, China had said Ma Zhaoxu, a vice foreign minister, would visit Australia and Fiji this week to hold a new round of “political consultations.”

The 80.5 per cent duties on Australian barley all but wiped out imports of the grain by the world’s biggest beer market, prompting a formal complaint by Australia to the WTO in 2020.

Until then, imports had ranged between A$1.5 billion and A$2 billion (C$1.34 billion to C$1.79 billion) a year.

The Grain Producers Australia welcomed the move. “This process to reach a resolution would be significantly shorter than if the WTO process continued,” said Chairman Barry Large in a statement.

China’s duties on Australian barley prompted its buyers to turn to Canada, France and Argentina, while Australian sellers shifted exports to feed barley markets in the Middle East.

That trend could now be reversed.

“Rebalancing is what will happen,” Brent Atthill, head of brewing consultancy RMI Analytics, said. “China will have more choices for buying and a better way to manage the war situation in (exporter) Ukraine.”

In China, while most maltsters already have enough stocks for this year, resumption of trade in a few months would allow Australia’s new barley crop, harvested from October, to reach China at the end of the year, said Yang Zhenglong, general manager at Malteurop China.

“Everybody is waiting for Australian barley to come,” he said.

In France, new-crop barley premiums had already plunged at the end of March ahead of talks between China and Australia.

“It looks like Australian barley will go back into the Chinese market, which is bad news for other suppliers like France, but also Argentina and Canada,” a European trader said.

— Reporting for Reuters by Alasdair Pal in Sydney and Dominique Patton, Yew Lun Tian and Ethan Wang in Beijing; additional reporting by Gus Trompiz in Paris and Michael Hogan in Hamburg.

The post Australia reaches deal with China in barley dispute appeared first on Manitoba Co-operator.

The world’s top soybean buyer is trying to lower its heavy reliance on imports of the oilseed as the pandemic, growing trade tensions and increasing climate disasters raise concerns about feeding its 1.4 billion people.

In its annual rural policy blueprint, known as the “No. 1 document,” the State Council, China’s cabinet, reiterated a recently stated goal to boost grain production capacity by 50 million tonnes, from current production of more than 650 million tonnes.

It will seek to raise corn yields, further support wheat farmers and “vigorously” promote rapeseed production, as well as lesser known oilseed crops such as camelina, state news agency Xinhua reported.

It will also speed up the commercialization of biotech corn and soybeans, according to the document.

No time frame was provided for the launch of GMO corn and soybeans, but many in the market expect a launch this year.

The document said China will fully implement a campaign to reduce soymeal rations in feed, another move to lower its reliance on soybean imports.

However, it acknowledged the role played by trade, and said it will “implement the diversification strategy of agricultural product imports thoroughly.”

The document also outlined plans to protect soil and conserve water, while strengthening controls on the use of arable land.

It also called for further development of indoor farms, with plans to explore building such facilities in the Gobi and other deserts.

— Dominique Patton is Reuters’ chief commodities correspondent in Beijing.

The post China to plant more soy, speed up GMOs to ensure food supply appeared first on Manitoba Co-operator.