China’s Ministry of Agriculture and Rural Affairs has unveiled a three-year action plan to decrease soymeal use in animal feed, maintain national food security and lessen China’s heavy reliance on soybean imports.
The new plan aims to reduce soymeal ratios in animal feed to less than 13% by 2025, compared to 14.5% in 2022. This would help “promote the saving and consumption reduction of feed grains, and contribute to ensuring the stable and safe supply of grain and important agricultural products”, according to the ministry’s statement.
Some experts believe that the plan could significantly reduce China’s soymeal consumption by 3 million tonnes a year, equivalent to 4 million tonnes of soybeans.
As a result, imports could decrease to 82 million tonnes by 2025, with feed manufacturers using more rapeseed, sunflower seed, and synthetic protein as substitutes. This would impact the production of soy oil, leading to an increase in palm oil imports.
However, Jim Sutter, CEO at the U.S. Soybean Export Council, does not believe that there will be a significant drop in soybean imports due to strong demand. He noted that there is a limit to how much soy can be taken out of rations.
The new target of under 13% by 2025 is slightly lower than the earlier target of 13.5%. Nevertheless, the direction is not new, according to Lief Chiang, a senior analyst at Rabobank. “The whole point is to build a more resilient supply chain amid geopolitical risks,” he said.
China, the world’s top soybean importer, purchases over 60% of the world’s traded soybeans, largely from the United States and Brazil. The country aims to reduce its dependency on soybean imports, particularly on the United States. The push for lower soymeal use has been successful so far, aided by soaring prices of the protein-rich ingredient in recent years.
Rabobank estimated that the ratio could drop to 12% by 2030, which would reduce China’s soybean imports to 84 million tonnes. This year, imports are estimated to be around 95 million tonnes.
The new plan also aims to increase the output of high-quality forage to 98 million tonnes by 2025 and approve up to two microbial proteins for feed. Pilot projects will be carried out to use leftover food and animal carcasses for feed in more than 20 large or medium-sized cities. This is part of China’s efforts to promote a more sustainable and diversified agricultural industry.