Limited space for price rise of soybean market in China after entering WTO

Introduction: after China's accession to the WTO, the adjustment of relevant policies, the opening of China's market and the entry of a large number of cheap agricultural products will certainly have a strong impact on China's agriculture This requires China's agriculture to carry out structural adjustment with mechanism guarantee, on the one hand, to realize agricultural diversification, industrialization, science and technology and modernization; on the other hand, in the import and export trade of agricultural products, to formulate relevant policies to protect the production of domestic agricultural products and the interests of domestic farmers within the framework of not violating WTO rules In recent years, the domestic soybean demand has increased greatly At present, there is a gap of nearly 10 million tons per year Last year, it was over imported, with a total of 15 million tons, almost equal to the domestic soybean production However, the annual carry over inventory reached more than 5 million tons, forcing the domestic soybean price to fall sharply At present, soybean is the only large variety of domestic agricultural products in short supply It is also a piece of fat meat exported by American agricultural products to China (last year, Sino US soybean trade reached more than $1 billion) Under the condition that the supply of most agricultural products is greater than the demand, the soybean market should also be a piece of fat for domestic farmers, but why not eat it by themselves? In my opinion, there are two reasons: First, in order to reach bilateral negotiations with the United States and enter the WTO smoothly, China has certain commitment to the United States in terms of agricultural product import, and to reach a certain market access quota, just because China's domestic soybean supply is in short supply, at the same time, in order to support the development of domestic oil enterprises, earn processing profits and increase employment, so that the original import of soybean oil and soybean meal can be reduced by reducing soybean production The form of import tariff was transformed into soybean import, which eventually led to a substantial increase in soybean import Second, in the international soybean market, due to the low interest loan policy in the United States to encourage the cultivation of soybeans, at the same time, South America continues to substantially increase the soybean planting area, as well as the cultivation of disease resistant genetically modified soybeans, making the world soybean market continuously oversupplied in recent years, and the price of soybeans is relatively low compared with that in China These two reasons lead to China's soybean market's "entry into WTO ahead of time" In recent years, the import tariff within the quota is only 3% Due to the reform of the foreign trade system, the quota system has become virtual, and the domestic soybean market has actually opened up However, even if we join WTO, it doesn't mean to open our country's door without restriction The phenomenon of soybean import seriously impacting the domestic market has attracted great attention of our government Therefore, the introduction of genetically modified policies is actually a reasonable and lawful technical way to control soybean imports in line with the WTO principle It is a non-tariff barrier The introduction of this policy is the beginning of China's adjustment of agricultural policies after WTO entry, and it can be regarded as one of the measures to protect domestic agriculture by mechanism It is believed that the departments concerned will continue to formulate and implement the challenge of adapting to WTO entry Relevant agricultural policies and regulations Before 1995, China was a net exporter of soybeans The transformation from a net exporter to the world's largest importer took only five years The great changes have aroused great concern of Chinese people Without urgent measures, the whole soybean industry in China will collapse Therefore, the introduction of genetically modified regulations and its implementation rules is very important to control soybean import However, its implementation and operation need a process The evaluation of its impact on China's soybean market should be carried out from domestic and international markets respectively: 1 The impact on the domestic soybean market The promulgation and implementation of the regulations and its detailed rules can't deny the social significance of strengthening the safety of genetically modified biological products from the long-term perspective; however, from the short-term perspective, the promulgation of the regulations is more to deal with the impact on domestic agriculture after China's accession to the WTO, which has been recognized by many market participants at home and abroad At present, it is mainly to control the import status of soybean and its products by issuing safety certificates, and to control the domestic soybean supply by combining quota distribution and strict management, so as to stabilize the relationship between supply and demand and regulate the price of soybean In the short term, I don't think it can lead to a sharp recovery of domestic soybean prices At present, the space for soybean prices to rise is very small, and it is more likely to maintain the interval oscillation On the basis of the balance of supply and demand, the price fluctuation of soybean is restricted by the price space of soybean products such as soybean oil and soybean meal In particular, soybean meal is the main product of soybean, and the cost and profit level of the feeding industry directly limit the price of soybean meal The price demand elasticity is very large If the price of soybean is too high, the squeezing industry can only shut down because of no profit, which restrains the price rise of soybean Moreover, at present, the stock level of domestic soybean is still oversupply, and the spot pressure is heavy From the long-term impact effect assessment, it is mainly to see that the implementation buffer period of the safety certificate (until December 20 of this year) is over, and after the temporary measures are cancelled, when the Ministry of agriculture of China issues the import safety certificate, the intensity of the regulation and control of the import volume, if the implementation is strong, will further improve the space for price rise next year 2 The impact on the international soybean market last year, the world's main soybean producing areas are increasing the planting area, so the growth of the world's total soybean output is relatively large, which has exceeded the growth of demand At present, the price level of the world's soybean market has proved this Although China imported 15 million tons last year, an increase of more than 5 million tons over the previous year, it failed to raise the world soybean price, which reflected this problem from another side This year's import restriction implemented by the GM policy is expected to be controlled at about 8-10 million tons per year (5 million tons have been imported), 5-7 million tons less than last year, which will have a huge impact on the world soybean market Recently, the U.S Department of agriculture predicted that the U.S sown area will only decrease by 2%, but the sown area of soybean in South America and China will continue to increase China's massive reduction in imports this year will limit the current technical rebound space of CBOT Some people think that El Nino will cause soybean yield reduction, but El Nino is characterized by flood, which has little impact on soybean planting area, far less than La Nina phenomenon - drought, which is called "a line of flood, a large area of drought" According to the comprehensive analysis, the possibility of soybean production reduction in the world this year is very important The supply-demand relationship is the decisive factor affecting the price fluctuation If China strictly restricts the import, although the policy can support the lower space of the price fluctuation in the domestic soybean market, it will increase the supply of the soybean market outside China at the same time The price of the world soybean market will decline because of the supply pressure On the contrary, it will restrict the rising space of the domestic soybean price, especially in today's after China's accession to the WTO In a word, in this year, the supply and demand of the world soybean market will not be significantly changed, and the world soybean market will still maintain the bottom oscillation In this context, even if China uses policies to restrict soybean imports, the space for price rise has been constrained, and the implementation of the policies needs further observation Therefore, in the first year after China's accession to the WTO, it is more likely that the soybean market will maintain the range oscillation The soybean price should fluctuate between 2200-1850, and the spot price should be about 100 yuan lower (author:) share to feed Weibo share to: