Source: APKinform (Ukraine)
A renewed trade war between the U.S. and China would have less of an impact on the Chinese soybean market than it did seven years ago, but could completely shut down access to it for the U.S. oilseed. That’s the assumption in an updated report from RaboResearch, Feedlot reports.
According to the report, it is likely that China will immediately retaliate by targeting grains and oilseeds, especially soybeans, if U.S. President-elect Donald Trump imposes additional trade tariffs. During President D. Trump’s first term, the imposition of retaliatory tariffs resulted in more than $27 billion in lost U.S. agricultural exports, with $25.7 billion of that directly attributable to tariffs imposed by China.
At the same time, compared to the 2018-19 trade war, China now has higher stocks of soybeans in state reserves due to increased imports from Brazil. In addition, Chinese livestock farmers have already adapted to low-protein feed formulas and have managed to reduce the use of soybean meal in feed.
“Since the last trade war, China has increased annual soybean production by 5 million tons thanks to its national oilseed recovery plan. State soybean reserves have also been built up, with ending stocks increasing by 20 million tons between 2021-22 and 2023-24,” the report said.
Soybean meal consumption in the People’s Republic of China has stabilized mainly due to the government’s promotion of low-protein feed formulations. Official Chinese data shows that the share of soybean meal in feed formulations fell from 17.3% in 2019 to 13% in 2023.
At the same time, analysts remind that China relies heavily on Brazil, which accounted for 74% of China’s soybean imports in 2023-24, the same level seen at the height of the trade war. With a significant increase in Brazilian soybean production in 2024-25 and a possible resumption of the U.S.-China trade war, Brazil’s share of the Chinese soybean market could increase to 80 percent or more.
“All of these factors create a scenario in which U.S. soybeans could be displaced from the Chinese market as a result of a new trade war,” the report summarizes.