China trims soybean import estimate by 10% as trade hiccups lingers

China trimmed its soybean import estimate for 2018/19 by 10 percent on Wednesday as farmers reduce their application of the bean in animal feed on lingering trade hiccups between the country and the United States.

The country equally raised its 2018/19 domestic soybean output forecast to 15.83 million tonnes from 15.37 million tonnes in August.

In the crop year beginning by October, soybeans import will be 83.65 million tonnes, down 10.2 million tonnes from last month’s estimate of 93.85 million tonnes, the Ministry of

Agriculture and Rural Affairs said in its monthly crop report.

The forecast is lower than the 93.9 million tonnes imported during the 2017/18 crop year.

Meanwhile, the estimate for corn demand due to rising feed consumption and increasing ethanol production was also raised.

The ministry said the lower forecast for soybean imports was also due to the promotion of lower-protein feed for livestock and poultry. Additionally, falling profits at pig farms should reduce demand for soymeal feed for the herds.

While the size of the soybean import cuts are largely in line with broader industry forecasts, the report marks the first official assessment by the government on the impact of the trade war.

The outlook illustrates how China’s vast pig farming sector is rapidly adjusting to a possible prolonged trade dispute with the US. In July, Beijing levied an additional 25 percent tariff on U.S. soybeans, threatening supplies from the second-largest exporter of the oilseed to China.

The import outlook changes pushed the 2018/19 soybean deficit forecast to 3.57 million tonnes from 250,000 tonnes in August, according to the report.