Why China import lot soybean

China imported 8.09 million metric tons of soybeans in October, the largest month in four years, and this year will see the largest annual imports on record.

The number of arrivals in October surged 56% from 5.18 million tons in the same period last year, according to customs data.

The crushing margin in Rizhao, China's main processing center, has risen to 75 yuan per ton of soybeans from about 600 yuan in August.

Some traders and analysts said that ahead of the US presidential election, US grain merchants are competing to ship record US harvests to China and are worried about renewed trade tensions.

Customs data showed that total soybean imports in the first 10 months of 2024 reached 89.94 million tons, an increase of 11.2% year-on-year, close to last year's imports of 99.41 million tons.

In 2020, China imported 100.31 million tons of soybeans, a record high.

Traders and analysts said that Trump's tariff threats in campaign speeches are prompting some Chinese importers to avoid US goods from January next year.

Why does China import so much soybeans?

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    Reason 1:

Soybean production can be highly mechanized, and less labor is required than other crops at the same mechanization level. It is one of the most labor-saving bulk crops.

China's truly abundant resource is labor. The more labor is needed in an industry, the more relative advantage China has. The less labor is needed in an industry, the greater China's relative disadvantage is.

Soybeans are an industry where China has a particularly large relative disadvantage. And industries such as vegetables, fruits, breeding, artificial breeding fisheries, and flowers that require the most labor, the greater China's relative advantage is.

Therefore, China's most cost-effective strategy is to focus on developing those industries with the greatest labor demand, exporting vegetables, fruits, flowers, etc., and importing products that can be highly mechanized and require less labor.

In the future, China needs to develop in the direction of highly knowledge-intensive agriculture. The low per capita natural resources is an unsolvable disadvantage. It cannot be solved by hard work, but knowledge can be solved by hard work. Therefore, the choice of industries with high labor consumption is only a temporary and necessary choice. High-knowledge agriculture is China's future.

If growing soybeans requires a lot of labor, similar to vegetables and fruits, then the international price of soybeans will become very expensive. Even if the soybean yield is much lower than other major food crops and China has little arable land per capita, we will still grow a lot.

The bean cleaning machine produced by our Hebei Beibu company is to solve one of the steps in this work.

We produce grain cleaning machines, wind screen cleaning machines, stone removal machines, specific gravity machines, etc. These are all machines for cleaning soybeans. By applying these machines, soybeans with very high purity can be obtained.

    Reason 2:

Because China has too little arable land per capita, although soybeans can solve the problem of "eating well" for the people, it must give priority to "eating enough", that is, give priority to planting crops with higher per-acre yields.

Even if it is more cost-effective to grow soybeans economically, China should reduce soybean planting and grow more high-yield crops such as corn, rice, and wheat. Importing soybeans can solve the problem of "eating well" and increase the nutritional sources of oil and protein.

In this way, even if a trade war occurs and others do not sell food to China, China can still ensure that it is full. And if a global natural disaster occurs, or there are problems in the global soybean industry, resulting in a significant reduction in production, China will be most conducive to ensuring food supply if it mainly grows high-yield crops.

    Reason 3:

China's per capita arable land area is insufficient, and it cannot solve the problem of producing all food by itself. After giving priority to ensuring the ability to eat enough, if you want to eat well, you can only import part of it. Based on the first two reasons, China chooses to import soybeans instead of importing other grains to produce soybeans by itself.

The combination of the above three reasons has caused China to import a large amount of soybeans instead of growing them by itself.