If the Tariff Were Confirmed, China Might Correspond with a number of Measures

By CnAgri2018-05-16 09:50:52 Print If 25% tariff were confirmed to be imposed on the soybeans, China could take a number of measures to reduce the impact of the taxation on the industry. For the vegetable oil market, China has many oil sources. Besides, a long-term soybean oil oversupply is found in China. Meanwhile, the shortage could be made up for through many channels. Therefore, the impact on the market would be relatively small. However, as the soybean meal is an important raw material of vegetable protein, the unforeseen event could greatly affect the domestic market in a short run. However, we could still take effective corresponding measures to keep the prices down:
 
First of all, to open the short-term soybean meal import and increase the imports of the substitutes such as rapeseed, DDGS and even sunflower meal. Secondly, to speed up the  the corn inventory access to the market through de-stocking and stimulate the production of corn alcohol in order to gain plenty of DDGS to replace the soybean meal demands. At present, China still has nearly 200 million tons of corn inventories. The de-stocking could be sped up in order to stimulate the corn alcohol production. As a result, plenty DDGS could replace the soybean meal demands. 
Secondly, feed enterprises could change the feed formulas and reduce the soybean proportions in the feed.
 
Thirdly, farming enterprises could reinforce the management, reduce the waste of feed and increase the efficiency.
 
On the whole, China’s agriculture could be affected greatly in a short run, especially, the animal and poultry farming would bear greater risks. However, in the medium and long term, the soybean shortage could be made up for through many channels. From another perspective, China could be compelled to take many measures to increase the soybean and rapeseed cultivation areas. Through adjusting the domestic crop planting structure, the domestic oil plant supply would be increased and the dependence of imported soybeans on America would reduce. Meanwhile, it would be helpful to improve the soil ecological environment and would be beneficial for the fulfillment of the sustainable development of agriculture.