Interdependence of China, United States, and Brazil in Soybean Trade

Fred Gale, Constanza Valdes and Mark Ash

No 413453, Miscellaneous Publications from United States Department of Agriculture, Economic Research Service

Abstract: Soybeans are the largest and most concentrated segment of global agricultural trade. Two land-abundant countries—Brazil and the United States—supply most soybean exports, and China accounts for over 60 percent of global soybean imports. International trade in soybeans began growing when China liberalized imports to meet demand for protein in animal feed and edible oils. A tariff structure favoring imports of soybeans, domestic policies favoring production of cereal grains, and rapid expansion of processing capacity drove China’s growth in soybean imports. More flexible U.S. policies facilitated production response by U.S. farmers to supply more soybeans, and Brazil’s expansion of output in its inland Cerrado region propelled supply growth in recent years. China imported even more Brazilian soybeans after imposing a 25-percent tariff on U.S. soybeans during 2018, but the overall volume of China’s imports fell for the first time in 15 years. USDA’s 10-year projections indicate that China will continue to account for most future growth in global soybean imports even if the tariff remains in place. However, USDA projects slower growth in China’s imports than in the previous decade. Projections show that Brazil will again account for most of the growth in global soybean exports during the next decade, but growth will be slower.

Keywords: Agricultural and Food Policy; Crop Production/Industries; Demand and Price Analysis; Food Consumption/Nutrition/Food Safety; International Relations/Trade; Labor and Human Capital; Land Economics/Use; Livestock Production/Industries; Production Economics (search for similar items in EconPapers)
Pages: 48
Date: 2019-06
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersmp:413453

DOI: 10.22004/ag.econ.413453

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