, VI Conference of BRICS Initiative of Critical Agrarian Studies

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The Future Direction of BRICS Countries’ Soybean Trade in the U.S.-China Trade Dispute
Yu Zhong, Mingzhe Pu, Xinye Lv

Last modified: 2018-12-13


The agricultural commodity market is one of the key aspects in BRICS countries’ economy. However, the US-China trade dispute continued to mainly reverberate around the soybean market. Most BRICS countries are soybean planters and traders. The U.S.-China trade dispute has changed the relative comparative advantages among the top soybean suppliers. As the largest importer, China’s importing strategy change will impact the trade relations of BRICS countries. China is more likely to fulfill its demand by diversifying import. For example, importing soya meal, soybean oil,  and broiler instead from other countries. Based on estimation, China can import extra 5.1 MMT oilseeds oil (including 2 MMT palm oil, 300 TMT rapeseed oil, 500 TMT soybean oil, 2 MMT sunflowerseed oil and 300 TMT other oil), 5.4 MMT oilseeds (including 5 MMT soybean, 1 MMT rapeseed, 200TMT peanut and 200 TMT sunflower seeds), 7 MMT soybean meal and 4.83 MMT meat (including 593 TMT , 4.02 MMT broiler and 220 TMT beef). Within China, the Chinese government has taken actions to boost domestic production. The restruction of China’s soybean industry is undergoing. In order to ensure stable supply, China’s overseas agriculture investment and cooperation will increase too. Additional imports will strengthen the soybean trade relations with Brazil. Other trade relation with the potential production countries, such as Russia, are developing. Except for soybean, diversified imports will impose opportunity to BRICS countries to connect each other more deeply in seeds oil and meat trade. As the main exporter of soybean oil and sunflowerseed oil, India and Russia’s trade orders from China may increase. And the China’s broiler trade relations with Brazil may be tighter. To ensure stable imports, China will enhance the overseas agricultural investments. Not only processing and transportation, but also plantation will be the core of China’s future overseas agricultural investment strategy.

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