Focus: Where is China's soybean industry?

China, which accounts for more than 50% of the world soybean trade, is facing the same embarrassing situation as imported iron ore. China is becoming the world's largest soybean importing country losing its pricing power.

At the beginning of 2012, COFCO and China Reserve Grain Management signed an agreement to purchase 13.4 million tons of soybeans in the United States, worth US$6.7 billion.

According to foreign sources, the above transaction sold 292 million tons of US soybeans to China on a single day, setting a record for the US Department of Agriculture’s single-day sales. In January 2011, the United States soybean sales record had risen to a high point, but only 2.74 million tons, of course, that is sold to China.

Faced with increasing soybean imports year by year, China's soybean market is being seriously impacted by the United States. The entire industry chain of the soybean industry in China is on the verge of “crash”.

The drastic reduction in planting area has resulted in a steady increase in grain production, and domestic non-genetically modified soybeans have made another sacrifice.

In early 2011, Heilongjiang Province, which accounted for two-thirds of the country’s total soybean production, decided that in order to ensure that the province’s food crop area is stable at 200 million mu, the province’s corn and rice will increase by 6.5 million mu and 350 million mu, respectively, and soybeans will be reduced to 5,000. Million acres.

“In 2010, Heilongjiang soybean planting area was 67.17 million mu, which has decreased by 576 million mu compared with the previous year, and the decline rate is close to 8%.” Some industry experts said in an interview with the media.

According to Heilongjiang Soybean Association statistics, soybean cultivation in Heilongjiang in 2009 was 4% lower than in 2008. Industry insiders are concerned that if the sown area continues to decrease, Heilongjiang's oil companies will fall into more serious difficulties and the vicious circle of the whole industry will be inevitable.

However, for the agricultural industry policy makers, this is another problem: the economic benefits of growing domestic soybeans are not high, and planting soybeans means reducing the planting area of ​​staple foods and saving the cultivation of staple foods such as wheat, rice, and corn. The issue of food security is more strategic.

Wang Langling, president of the Heilongjiang Provincial Regional Economics Association, believes that in 2009, domestic soybean production was approximately 16 million tons, while imported soybeans reached 42.55 million tons, an increase of 13.7% year-on-year. The import of low-priced soybeans has seriously impacted the domestic soybean industry. The domestic soybean processing industry has been squeezed from the cultivation, production, and sales of the entire industry chain.

Enterprises choose to use low-priced genetically modified imported soybeans, it seems very "cost-effective." A set of data can illustrate the advantages of U.S. soybeans relative to Chinese soybeans. From 2011 to 2012, the average soybean yield per hectare in the United States was 2.79 tons, while Brazil’s output per hectare was 2.88 tons. China's soybean yield is only 1.76 tons per hectare, and the United States' output per unit area is 58.5% higher than that of domestic soybeans.

The United States has more soybean genetically modified products and its oil yield is higher than that of Chinese domestic soybeans. The American soybean oil output rate is 18.5%, and China's soybean oil output rate is about 16.5%. This means that with the same 1 ton of soybeans, US soybeans can produce 185 kg of soybean oil, and Chinese soybeans can only produce 165 kg. Calculated at 9 yuan per kilogram, an extra 20 kilograms can earn 180 yuan more, obviously not a decimal.

According to data measured by CNG, Guangzhou imported soybeans at 3,850 yuan/ton, processing cost was 100 yuan/ton, and the oil output rate was calculated at 18.5%. The export rate was calculated at 78.5%, and the soybean oil price at level 4 was 8,900 yuan/ton. The price of soybean meal is 3,100 yuan/ton, and the profitability of the oil mill is about 130 yuan/ton. The 20 kilograms of soybean oil used for imported soybeans has far exceeded the profits of the oil plant.

It is understood that although imported soybeans were once priced at around 4,300 yuan per ton, and soybeans in Northeast China were less than 4,000 yuan per ton, companies are more willing to accept imported beans from the entire ship and are not willing to send people to buy in rural China. The acquisition of soybeans seems to be low in price, and other companies have really paid for it. With manpower and material costs, the price per ton is higher than the cost of imported soybeans.

A person in charge of the Heilongjiang Soybean Association said that the oil companies in the province were under pressure to survive and they staged a flee: "These companies are basically two factories - the coastal factories can directly use imported soybeans as a pillar of the enterprise; in Heilongjiang The factory will start construction in phases depending on the situation."

Domestic soybeans are favored in the world market When domestic soybeans are squeezed into the “corner corner” by imported soybeans in the crushing sector, the absolute advantage of non-genetically modified soybeans makes Chinese soybeans become a strong international industry in the food industry such as soybean protein. .

Unfortunately, such strength did not make non-genetically modified soybeans the first choice for farmers. China Soybean Industry Association predicts that in the next 5 to 10 years, China's soybean food and food processing will face shortage of raw materials.

"Over the past 10 years, the world soybean production has increased by an average of 4%, but most of the increase has been feed-grade genetically modified soybeans rather than food-grade non-genetically modified soybeans." Liu Denggao, vice president of the China Soybean Industry Association, told reporters that he has repeatedly cut acreage. Chinese soybeans are popular with foreigners. According to a report provided by the China Soybean Industry Association, China's soy protein exports already account for 50% of international trade.

“In the international market, there are more than 2,500 kinds of foods in the United States that need to add soy protein, and Japan consumes more than 600,000 tons of soy protein every year.” Liu Denggao said that even the world-class giant of the soybean trade and processing industry, Cargill, has to import China. Non-genetically modified soybeans. U.S. exports to China are also made using Chinese soybean protein as raw material.

According to Li Denglong, chairman of Gushen Group, five years ago, only a dozen countries imported soybean protein powder from China, and now more than 50 countries have imported soybean protein powder from China.

In the statistics of the China Soybean Industry Association, China's current soybean protein foods are growing at a rate of 10% in the European and American markets, and domestic soybeans used for food processing in China are also increasing at a rate of 1 million tons per year. The total amount in 2010 exceeded 10 million tons, accounting for 65% of total output.

It is understood that, compared with the profit margin of about 5% of domestic edible oil processing industry, the profit margin of about 27% of soy protein products is almost "profiteering."

According to statistics of the Soybean Products Committee, in 2009 domestic processed soybeans increased by 64% compared with 2008, and sales increased by 40%. In 2007, there were only seven of the country's soybean processing sales of billions of yuan, 13 in 2008, and 24 in 2009. There are already two companies with sales of 1 billion yuan.

However, the seemingly good prospects of the domestically produced soy food processing industry currently do not give the bean farmers a passion for growing beans.

Liu Denggao told reporters that the import shock and the decline in the income of soybean farmers have become major issues that cannot be solved for many years.

According to Zhan Wei, a senior industry analyst at the China Center for Circulation Productivity Promotion Center, although the purchase price of the State Reserve is relatively high, the standard is strict and only a small portion of domestic soybeans can meet the standard. “Farmers who want to sell beans to the State Reserve must increase transportation and warehousing costs. Second, soybeans have a competitive relationship with corn and rice, and their planting profits are not as good as those of the latter two. Plus, the country must first guarantee food supply and it will not grow soybeans significantly."

It is understood that under the general increase in food prices in 2010, the purchase prices of rice, corn, and soybeans in the three major food crops market rose by 9%, 13%, and 6%, respectively, and the soybean yield was about 215 yuan per mu. About 300 yuan, much higher than soybeans, farmers' willingness to grow soybeans continues to decline.

Support policy was referred to as "not to force"

In November 2009, the National Development and Reform Commission and other departments announced a subsidy of 160 yuan per ton for processing companies that bought domestic soybeans to flatten the spread between imported soybeans and domestic soybeans.

According to this policy, oil processing companies must purchase domestic soybeans at a price of 3,740 yuan per ton, but it seems that the policy has not been approved by the industry.

A responsible person of a processing company clarifies the reasons: “From November 2010, during the five months, imported soybeans fell from 3,900 yuan to 4,000 yuan per ton to 3,200 yuan to 3,300 yuan today. The market has changed so much. The soybean subsidy policy is still maintained at 160 yuan per ton. At that time, it was still competing to get into this policy car. Now, there are several companies that value this?”

The relevant person in charge of the Heilongjiang Soybean Association also believes that from the perspective of policy implementation, the country's subsidy policy is indeed somewhat lagging behind.

According to calculations, according to the purchase price of 3,740 yuan per ton stipulated by the state, even if there is a subsidy of 160 yuan per ton, enterprises that are processed per ton of domestic soybeans will still have to lose about 160 yuan.

The data shows that 3.8 million tons of soybeans sold by farmers in Heilongjiang were sold to the National Depository by more than half. In the past, the local oil and fat companies that played the leading role in the soybean acquisition market have basically withdrawn from the acquisition market this year.

Heilongjiang Jinquan Group official said that as the leading private oil company in Heilongjiang Province, his products have not been able to open markets in big cities such as Beijing and Shanghai. “Today, soybean oil produced by domestic soybeans is no longer seen in areas outside the Northeast, and domestic soybeans have basically exited the oil extraction market!”

Faced with the dilemma of soybeans, people in the industry believe that the country should consider soybean as a national strategic resource and give priority to soybean cultivation.

Soybean industry is a long-industry chain industry, involving production, oil processing, food processing, aquaculture, medicine, chemical fiber and other industries. China has 100 million people dependent on soybean production, involving 60 million farmers and nearly a million soybean processing enterprise employees. Giving up soybean oil extraction industry is equivalent to giving up huge economic benefits and numerous job opportunities, and also gave up China’s food security.

Some experts suggested that at this stage we must increase the subsidy standards for soybeans and expand the scope of subsidy. From the current subsidy, part of the planting area will be expanded to all subsidy, and the subsidy will be changed from supplementary supply enterprises to direct subsidy farmers.

It is understood that after the Agriculture Act of 2002 came into effect, the government subsidy for every ton of soybean produced by American farmers increased from 15.2 U.S. dollars in the early 1990s to 59.1 U.S. dollars in 2004.

The US government's soybean subsidy policy has brought a huge impact on the Chinese soybean market. Affected by the low price of soybean in the United States, in recent years, US soybean exports to China have soared. Soybean has become the third largest product exported to China by the United States, second only to aircraft and semiconductors.

According to the US Department of Agriculture, as of August 6, 2009, China imported 19.8 million tons of US soybeans, an increase of 44.53% year-on-year; China's imports accounted for 55% of US soybean exports, an increase of 12 percentage points from the same period last year.

In contrast, China's low subsidy standards, small scope, and imperfect soybean protection system have impeded the international competitiveness of soybean crops in China.

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