Efforts to reduce grain imports receive new attention but face significant challenges

China’s feed substitution efforts, which are intended to reduce reliance on imported corn and soybeans, were recently covered by Yicai, a business publication, and offer insights into the country’s efforts to reduce its reliance on imported feeds.  

In August, the Ministry of Agriculture and Rural Affairs published its roadmap to reduce the country’s reliance on imported grain. The ministry said that while the country should utilize grain imports, these should be kept at a “moderate” level and the focus should remain on self-sufficiency. 

Self-sufficiency in grain production remains a top focus of the government and directly connects to broader concerns such as national security. The ministry noted “[corn] is one of the three major staple food varieties in China, and a high domestic self-sufficiency rate must be maintained to avoid being controlled by others.” 

While there are efforts to reduce the amount of corn and soybean meal in feed, the efforts also face significant challenges.  

Local Chinese media Yicai notes that other grains can substitute corn if their price is 100-200 yuan/ton cheaper, and those alternatives include rice, wheat, sorghum, and barley. However, China is also heavily dependent on sorghum and barley imports.  

In the 2021/22 marketing year, domestic barley production is estimated at 2 million tons, compared to imports of 8.5 million tons. Domestic sorghum production is estimated at 3 million tons compared to imports of 10.5 million tons. 

The use of wheat in wheat also increased dramatically in recent years, rising from 19 million tons in 2019/20 to 40 million tons in 2020/21. This large increase in wheat feeding led the government to add many restrictions to auctions of reserve wheat that blocked feed producers from the auctions.  

For protein, efforts to reduce soybean meal in animal feeds rely on plans to increase the use of alternative oilseeds, such as rapeseed, or increasing the inclusion of amino acids. Both of these also face difficulties.  

While China’s rapeseed crop saw record production last year, production has only risen by 1.6 million tons over the past decade. In the same timeframe, soybean imports rose 30-40 million tons.  

The use of amino acids is also unlikely to reduce China’s dependence on imported soybeans.  

According to researchers interviewed by Yicai, if China improves its industrial production of amino acids, this will reduce soybean meal use by 26 million tons by 2030.  

While this would be a significant reduction, even this optimistic scenario would still mean the country would be reliant on import soybeans.  

Although self-sufficiency and reducing dependence on imports have received more attention in recent years, China is unlikely to substantially reduce its imports of grains and oilseeds over the coming years.