Trade war: China and the United States "bean" where to go, low-protein food to meet the opportunity?

June because of sino-US trade friction staged a sea fantasy rafting 80 days, in July the U.S. soybean cargo ship Pegasus again staged a life-and-death war, speed of more than 14 nautical miles per hour, but the power of the flood still failed to run tariffs, this dramatic scene is caused by the Sino-US trade war. Up to now, China has not purchased u.S. soybeans for 5 weeks, and cancelled a total of 1.14 million tons of U.S. soybean orders for 2017/2018.
md8 .While the domestic import dependence is very high soybean sand and soybean meal, has become the focus of attention, according to Huitong statistics, since the second quarter of the trend of soybean meal volatility, the highest point is 3560 yuan / ton in April, the low point of 2900 yuan / ton in June, the current average price of 2950-3100 yuan / ton. In 2017, China's soybean imports from the United States have 32.8527 million tons, accounting for up to 34.4%, and China increased the U.S. soybean tariff of 25%, canceled the U.S. soybean orders, for this middle gap, what are the responses, soybean meal market where? Which products offer opportunities?
md8 . md8July China-U.S. trade war dynamics
md8we first review the U.S.-China trade war in July, July 6 the U.S. began to impose a 25 percent tariff on $34 billion of Chinese products, China also began the same day at 12:01 to impose tariffs on $34 billion of imports, including soybeans, and the trade war officially began. On July 10, U.S. time, the U.S. Trade Representative's office released a list of tariffs on an additional $200 billion in Chinese exports to the U.S., and China said it would do the necessary countermeasures to resolutely safeguard its legitimate and legitimate rights and interests, and there was a tendency for further escalation of the U.S.-China trade conflict.
md8 .It is understood that the United States is the world's second largest soybean exporter, 2017-2018 exports accounted for 37% of global trade; China's cancellation of orders and a reduction in imports are a big loss for U.S. farmers, and the U.S. Soybean Association, which issued a july 12 statement calling on the U.S. government to lift tariffs on China.
md8 .On July 11, the U.S. Senate voted overwhelmingly 88:11 to impose tariff stakes on Mr. Trump. The U.S. Senate passed the resolution, citing national security concerns, calling on Mr. Trump to approve tariffs, ABC News reported. In addition, July 14 (UPI) -- The U.S. Commerce Department has reached an agreement with ZTE Corp. of China to lift the ban after paying a $400 million bond and allow ingamintoe to resume operations, according to China's Ministry of Commerce. Trump's face, the day of June, for the capricious style of play, let's keep an eye on it and wait and see.
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China's soybean imports or new patterns
md8China's soybean imports mainly come from three countries: Brazil, the United States, Argentina. In recent years, Brazil has been actively expanding the area of genetically modified soybeans, production has gradually increased since 2000, China has also increased the amount of soybeanimports imported from Brazil, Brazil gradually replaced the United States as China's largest supplier of soybeans.
md8 . md8China imported 95,529.8 million tons of soybeans in 2017, an increase of 13.9% YoY, a record high, including 90,364.7 million tons from Brazil, the United States and Argentina, and only 5.1651 million tons of soybeans imported from other countries combined. Imports from the United States during the period amounted to 32.8527 million tons, accounting for 34%, while imports from Brazil amounted to 50,928.7 million tons, or 53%, and imports from Argentina amounted to 6.5833 million tons, or 7% (see figure below).
md8 . md8July 12, China's Ministry of Agriculture for the first time lowered its annual soybean import forecast for 2018/19 to 93.85 million tons, down 1.8 million tons from the previous month's forecast. And said that after the import tariffs came into effect, the U.S. soybean market share in China plummeted, the global soybean trade pattern is facing a rebalancing. As for the response measures of the gap, Xiao Huanhuan first simply summarized it as two additions and one decrease, one increase for supply-side reform, increase domestic soybean subsidies, expand the planting area;
md8 .　　Measure 1: Asia-Pacific countries import tariffs reduced to zero, in the Russian distribution of the grain industry chain
md8 According to the National Grain and Oil Information Center experts, China's u.S. soybean import tariff of 25%, will increase the cost of U.S. soybean imports 700-800 yuan / ton, higher than Brazilian soybeans 300 yuan / ton. As a result of the tariff increase lost competitive advantage, domestic enterprises will significantly reduce the procurement of U.S. soybeans, and take measures to broaden the source of soybeans, mealen imports and other measures to protect supply. In addition to South America and Russia crowding into the top of China's import list, China has also turned to the development of Canada, Ukraine, India, Laos, Ethiopia, Kazakhstan and other non-traditional soybean import markets. The State Council's Tax Commission issued a notice that since July 1 this year, imports of soybean products originating in Bangladesh, India, Laos, South Korea and Sri Lanka will be reduced from 3% to zero tax rates, in order to boost the export of legume products to China and the expansion of soybean cultivation in these countries.
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Cofco bought the Russian docks
md8 China's imports of soybeans from Russia in 2017 significantly increased, has exceeded 500,000 tons, an increase of 33.95 percent year-on-year. Recently, China's cooperation with Russia has become more frequent, and China is becoming the first importer of Russian grain. COFCO, which has laid out its grain industry chain in Russia, recently announced plans to spend 2.6 billion yuan to buy a terminal in southern Russia for the transportation of grain. In order to minimize logistics costs, the possibility of building a logistics warehouse complex in the Russian Far East Forward Development Zone is also under consideration. At the same time, China Agricultural Group Co., Ltd. and the Russian "Union" Group are in talks to build a deep soybean processing plant in the Jewish Autonomous Region of Russia. Next year Russia plans to supply 1.5 million tons of grain to China, and soybeans and cooking oil are aiming to export 10 million tons.
md8 .　　Measure s2: domestic soybean planting area continued to grow
md8 in the domestic corn three high background, in the last two years, China's corn deep processing enterprise production capacity expanded wildly, is expected to 2018 grain feeding area of 12 million mu, an increase of 2 million mu, and this year the state to the planting industry subsidies to make a major adjustment, soybean subsidies increased to 200-210 yuan per acre, corn subsidies reduced to 100 yuan per acre. In 2018, China's soybean planting area and total output will increase for 3 consecutive years, with output exceeding 15 million tons. According to the forecast data of the National Grain and Oil Information Center, china's soybean cultivation area will increase by 8.6% year-on-year in 2018, while corn will decline by 1.3%. However, the far water can not solve the near thirst, at present, China's soybean yield is low, low purchase price, planting efficiency is not high, the main supply of food, cooking oil and exports, far from meeting the demand for soybeans in animal husbandry, so soybean imports will continue to maintain a high level. However, China vigorously implement agricultural supply-side reform, more and more attention to domestic soybeans, improve the rate of self-sufficiency, production capacity has been revived, the trade war in the latter stages of the acquisition price or planting subsidies increase the possibility of increasing, next year domestic soybean planting area may continue to climb.
md8 .　　Where does China's soybean meal market go from here?
md8 .　　Because of the different harvest periods of soybean cultivation in the northern and southern hemispheres, soybeans from South America and the United States are complementary, and China can adjust imports. For example, South American soybeanharvest harvest from late February to May, China's imports of South American soybeans in the second and third quarters, the United States soybeans in late September to early November harvest, China's imports of U.S. soybeans concentrated in the fourth quarter and the first quarter of the following year. In the third quarter of 2018, China mainly purchased soybeans from South America, july and August China's total soybean arrival volume is expected to be about 16-17 million tons, coupled with the current high carry-over inventory of oil plants, domestic soybean supply is abundant, domestic farming benefits are at the cost line, oil plants have inventory pressure, supply and demand report short, poor fundamentals, this is why the current soybean meal is not still small drop, hovering at 3000 yuan / ton.
md8 . md8 it should be noted that in October South American soybean supply entered the end, in the fourth quarter of 2017/2018 plus a quarter, China imported a total of 24.4375 million tons of U.S. beans (see figure below), accounting for 60% of the total import stake during this period, that is to say, if the subsequent trade war does not turn around, count the early stock preparation time, September this year to March is the real test of China's soybean meal market. In 2017-2018, Asia-Pacific countries soybean production base is low, planting area expansion is not overnight, soybean exports in more than 10 million tons of countries only the United States and Brazil, the United States and Brazil to impose tariffs on U.S. soybeans to raise China's soybean costs, although later China can south America and other regions to significantly increase the purchase volume, but also will lead to South American soybean supply tight opportunity to raise prices, and even South America and other regions to buy cheap U.S. beans and then sell to China. Previously, the relevant departments have held a symposium, if the Impact of the U.S. soybean tax increase is greater, involving soybeans large enterprises or will get subsidies.
md8 .　　In short, if the Sino-US trade war continues to burn, short-term supply pressures are expected to depend, the soybean meal market will be restrained, and the mid-to-late stages will rise as costs rise. Brazil's soybean harvest in 2018, the area under soybean cultivation in South America may continue to increase in 2019, and the "Belt and Road" countries in Central Asia may also increase soybean cultivation, the global soybean trade pattern will face a rebalancing.
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response measures three: the Ministry of Agriculture and Rural Areas advocated green development, research to reduce the amount of soybean meal
md8 after China's accession to the WTO in 2001, China was forced to reduce tariffs to purchase the United States genetically modified soybeans, from soybean producers gradually into soybean importers, when transit, now the United States to provoke a trade war Soybean card has become China's counter-attack against the United States weapons, in addition to widening the source of imports, this card is another trick is to reduce soybean imports, to know that China in increasing imports of soybeans and protein meal to other countries at the same time, but also to strengthen the research of feed formula, reduce the demand for soybean meal, to make up for the gap after the withdrawal of The United States soybean. Recently, the Ministry of Agriculture and Rural Affairs issued a series of circulars advocating the green development of low nitrogen emission reduction, studying alternatives to soybean meal reduction in feed, and exploring the feasibility of application of low-protein diet and other technologies. See below:
md8 Agricultural Green Development Technology Guidelines Notice the introduction of feed guidance direction
md8 July 2, 2018, the Ministry of Agriculture and Rural Affairs on the issuance of "Agricultural Green Development Technology Guidelines (2018-2030)", including the introduction of guidance on the development direction of feed:
md8 key research and development: animal and poultry feed nutrition control key
technology, feed feed precision formula technology, fermentation, md8 integrated demonstration: feed raw material diversification and comprehensive utilization technology, unconventional feed raw material quality and efficiency technology, etc. . .
. md8 promotion and application: animal and poultry aquatic nutrition precision supply technology, feed nutrition control low nitrogen emission reduction technology, feed mycotoxin prevention and control technology, etc. . . .
. md8 md8 held a seminar on the replacement of soybean meal reduction
md8 July 3, the Ministry of Agriculture and Rural Affairs, the Department of Livestock, convened relevant experts and the technical leaders of large livestock enterprises to study the alternative sage reduction in feed, to explore the feasibility of low-protein diet and other technologies (see figure below), but this meeting is estimated to be a small closed-door meeting, only out of notice, there is no specific content. Soybean meal reduction is a situation that feed enterprises need to face, which needs to be studied from several aspects such as increasing the raw materials of unconventional feed, low protein daily grain, soybean meal substitute products, etc.
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soybean meal reduction instead of a brief analysis of the
md8 due to the extreme dependence on domestic soybeanimports imports, by the supply side of the weather, logistics, external market, supply and demand reports and other factors, speculation topic frequency, price fluctuations and fluctuations. Therefore, for the amount of soybean meal reduction, China's feed and aquaculture enterprises accumulated experience can be quite a lot, common mixed meal daily grain, simply said, is the use of cotton meal, vegetable meal and other miscellaneous or DDGS, fermentation protein raw materials and other substitutes for a small number of soybean meal, and supplemented with enzyme preparations, amino acids and other additives to improve the conversion rate of mixed meal feed, in recent years more in the soybean meal rise stage adopted, to reduce costs, replacement situation and soybean price difference.
md8 .　　There is also a low protein diet, low-protein diet has been out for years, is not a new word, refers to the feed protein level according to the NRC recommended standard to reduce 2%-4%, and then add industrial synthetic amino acids, reduce the amount of protein raw materials at the same time meet the needs of livestock and poultry amino acids feed. A 1% reduction in crude protein levels in feed could reduce nitrogen emissions by 8-10%, reduce the total amount of pig excreta, reduce ammonia concentration in pig houses, and reduce diarrhea, said Yan Shiyan, a professor at China Agricultural University.