China’s soybean imports are likely to touch a record high of 57.5 million tonnes in 2012, up 9.3 percent year on year, due to the country’s booming demand and shrinking domestic output.
China’s soybean growing area fell 13.8 percent from the previous year to 5.79 million hectares in 2012, marking five consecutive years of decline, according to data from the Ministry of Agriculture.
The ministry forecast that yields will likely decrease 5.3 percent year on year to 1,693.5. kilos per hectare because of a summer drought, causing the country’s total soybean output to a three-year low of 9.8 million tonnes.
Falling domestic output suggested that China is becoming more dependent on the global market.
According to the latest report from the U.S. Department of Agriculture, China’s soybean imports will rise to nearly 61 million tonnes next year, up 3 million tonnes from 2012.
“Brisk demand has pushed the country’s soybean imports steadily up in recent years,” said Xu Liang, an analyst at the Shanghai East Asia Futures.
Margins at Chinese oilseed crushers have been eroded due to rising import prices of soybean. But analysts said prices may fall in the future as South American soybeans will be harvested and come to market soon.