China’s December soybean imports plunged 40.1 percent from a year earlier, customs data showed on Monday, as it cut purchases from the United States, its second-largest supplier, because of the trade war between the two countries.
Imports last month dropped to 5.72 million tonnes, said the General Administration of Customs, the lowest for the month since December 2011.
For all of 2018, imports fell for the first time since 2011 because of the higher tariffs China levied on U.S. supplies as part of the trade war. Soybean imports last year fell 7.9 percent to 88.03 million tonnes, customs said.
China, the world’s top soybean buyer, usually sources the bulk of its oilseed imports from the U.S. in the final quarter of the year when the U.S. harvest comes to market.
But, soybean imports from the U.S. plunged to zero in November.
December’s imports were only slightly above the 5.38 million tonnes imported in November and below expected volumes of around 6.5 million tonnes, said Monica Tu, analyst at Shanghai JC Intelligence Co Ltd.
The decline also bucked the usual trend for soybean shipments to surge in December as farmers fatten pigs for slaughter ahead of China’s Lunar New Year festival that falls in January or February.
Chinese buyers have been relying on bean stocks in Brazil, its top supplier of the oilseed, in the fourth quarter due to the Sino-U.S. trade war.
Monday’s figures did not give a breakdown of imports by origin. But almost all of the December shipments likely came from Brazil, said a trader who declined to be identified.
Additionally, supplies appear to have cleared more slowly through ports, said Shanghai JC Intelligence’s Tu, while domestic demand has also been weak, with soymeal alternatives in the market increasing.
“It’s the broader environment and the trade war,” said Tu.
January imports should pick up from December, as some delayed cargoes arrive, said a second trader, who also declined to be identified.
Beijing has also resumed purchases of at least 5 million tonnes of U.S. soybeans for delivery in the first months of 2019, following a truce between the two countries agreed on Dec. 1. But China’s 25 percent tariff on U.S. cargoes remains in place.
China’s imports of vegetable oils in December were 742,000 tonnes, up 21.6 percent from the previous month. For 2018, vegetable oil imports rose 9 percent to 6.29 million tonnes.
