China Agribusiness Report

Providing expert analysis, independent forecasts and competitive intelligence on the agribusiness industry.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, Supply & Demand Forecasts, Commodity Price Analysis and Company Profiles.

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China Agribusiness Report
Product Price
$1,295.00

BMI View: China's weight in the global agricultural sector is growing, as the country has an increasing impact on international production balances and prices. China will maintain its appetite for key commodities for the foreseeable future , with particular potential for production growth in sugar, dairy and livestock . High demand growth, strong government support and the potential for investment and consolidation in these industries will help them outperform in the coming years. However, the agribusiness sector is experiencing challenging times, seen in the slowdown in meat and milk powder consumption in 2015 .

Agribusiness Market Value
BMI Market Value By Commodity (2005-2020)
e/f = BMI estimate/forecast. Source: BMI, FAO

Key Forecasts

  • Corn production growth to 2019/20: 12.0% to 242mn tonnes. Given the decrease in public support to corn production, output expansion will be driven by steady improvements in corn yields and the probable adoption of genetically modified (GM) corn in the coming years. China's production deficit will amount around 6.7mn tonnes by the end of our forecast period.

  • Pork production growth to 2019/20: 13.0% to 62.1mn tonnes. Increased production continues to be encouraged on the back of elevated local livestock prices. The increased availability of vaccinations and the ongoing commercialisation of the industry are also likely to boost output.

  • Sugar consum ption growth to 2020: 18.5% to 19.9 mn tonnes. Consumption will be boosted by rising income, which will support demand for products in key industries, such as confectionery, dairy, beverages and food processing.

  • BMI universe agribusine ss market value: USD1.34tr n in 2016 (up 3.6% compared with 2015, growth forecast to average 4.3% annually between 2016 and 2020).

  • 2016 real GDP growth: 6.3% (down from 6.9% in 2015, forecast to average 5.8% between 2016 and 2020).

  • 2016 consumer price inflation: 1.8% y-o-y ave (up from 1.5% in 2015, forecast to average 2.3% between 2016 and 2020).

Key Developments

Under its new 13th Five-Year Plan, which was finalised and approved at the annual National People's Congress in March 2016, China will carry on reforming its agricultural sector. With these reforms, China aims to address mounting challenges and deficiencies in its agricultural sector - which include grains overproduction, elevated prices far above international levels, excessive government stockpiling and environmental degradation. Authorities are now aiming to boost yields to offset the stagnation in arable land, but without sacrificing the environment. Moreover, China plans to diversify production towards commodities in increasing demand (including meat and milk), while accepting imports of a larger volume of staples when needed.

In order to achieve these goals, the government will foster changes in farm structure, the partial liberalisation of agricultural prices and rebalancing the mix of commodities. It will also intensify its mechanisation efforts and focus on innovation to boost the country's own seed technology in order to eventually commercialise GM corn seeds. State-owned China National Chemical Corp (ChemChina)'s offer to acquire Syngenta for more than USD53bn, which was announced in February 2016, represents another step towards the development of a local GM sector.

China is also changing its stance on food imports and showing signs that it is ready to accept larger volumes of imports in the coming years. In order to mitigate its reliance on foreign resources, the country is diversifying its import suppliers base (towards the Black Sea region and Latin America) and looking at controlling the trade supply chain by investing in commodities trading houses ( China National Cereals, Oils and Foodstuffs Corporation acquired a majority stake in food traders Nidera and Noble Group in 2014) and international food producers ( Shuanghui acquired US pork producer Smithfield in 2013).

Several agricultural sectors are going through challenging times. Meat and dairy production is decreasing or slowing down due to structural inefficiencies and profitability challenges in the sector and some large-scale farm investments being cancelled or postponed. This was the case with Fonterra, which has changed its strategy regarding the development of dairy farms in China. In general in the feed, meat and dairy sector, large and efficient companies will ride out of the gloom, while backyard and small producers will be pushed out of business by rising labour and production costs and tightening bank loan requirements.

BMI Industry View
7
SWOT
10
Agribusiness
10
Industry Forecast
12
Grains Outlook
12
Table: China - Grains Production And Consumption Outlook
13
Table: China - Risks To Grains Outlook
13
Table: Grains Production & Consumption (China 2013-2020)
18
Rice Outlook
19
Table: China - Rice Production And Consumption Outlook
19
Table: China - Risks To Rice Outlook
20
Table: China Grain Procurement Prices (CNY/tonne)
21
Table: Rice Production & Consumption (Cina 2013-2020)
22
Oilseeds Outlook
22
Table: China - Soybean Production And Consumption Outlook
23
Table: China - Risks To Soybean Outlook
24
Table: Soybean Production & Consumption (China 2013-2020)
27
Sugar Outlook
27
Table: China - Sugar Production And Consumption Outlook
28
Table: China - Risks To Sugar Outlook
28
Table: Sugar Production & Consumption (China 2013-2020)
32
Cotton Outlook
32
Table: China - Cotton Production And Consumption Outlook
33
Table: China - Risks To Cotton Outlook
33
Table: Cotton Production & Consumption (China 2012-2020)
38
Dairy Outlook
39
Table: China - Dairy Production And Consumption Outlook
39
Table: China - Risks To Dairy Outlook
41
Table: Dairy Production & Consumption (China 2013-2020)
48
Livestock Outlook
49
Table: China - Livestock Production And Consumption Outlook
50
Table: China - Risks To Livestock Outlook
51
Table: Livestock Production & Consumption (China 2013-2020)
55
Featured Analysis
57
Provincial Agricultural Landscape: Diverging Trends
57
Table: China - Agribusiness Production By Provinces, 2014 (% of total)
63
Table: China - Agribusiness Production Growth By Provinces (% chg between 2010 and 2014)
63
Commodities Price Analysis
65
Global Commodities Strategy
65
Table: Select Commodities - Performance And BMI Forecasts
65
Upstream Analysis
67
Asia Machinery Outlook
67
Table: Select Countries - Average Size Of Farms, Hectares
70
Asia Fertiliser Outlook
72
Asia GM Outlook
77
Table: Selected Countries - GM Crops Use (mn hectares)
80
Downstream Analysis
82
Food
82
Confectionery
83
Regional Overview
84
Table: Impact Of El Ni-o On Crops
84
Competitive Landscape
89
Table: China - Major Agribusiness Companies
89
Demographic Forecast
91
Table: Population Headline Indicators (China 1990-2025)
92
Table: Key Population Ratios (China 1990-2025)
92
Table: Urban/Rural Population & Life Expectancy (China 1990-2025)
93
Table: Population By Age Group (China 1990-2025)
93
Table: Population By Age Group % (China 1990-2025)
94
Methodology
96
Industry Forecast Methodology
96
Sector-Specific Methodology
97

The China Agribusiness Report features BMI Research's market assessment and independent forecasts for production, consumption and trade across core agricultural commodities.

BMI's China Agribusiness Report includes independent commodity price forecasting and analysis for key agricultural outputs, an overview of the agribusiness competitive landscape and a discussion of the downstream context of agricultural production in relation to country food consumption forecasts and composite food and beverage trade forecasts.

Key Benefits

  • Use BMI's independent industry forecasts to test other views - a key input for successful planning in dynamic agribusiness markets.
  • Apply BMI's medium-term commodity price analysis to assist with budgetary planning and the identification of investment opportunities and potential risks.
  • Assess the activities and market position of your competitors, partners and clients.

Coverage

BMI Industry View

Summary of BMI’s key industry forecasts and views, highlighting recent changes and key risks to the industry outlook.

Industry SWOT Analysis

Analysis of the major strengths, weaknesses, opportunities and threats within the wider agricultural industry.

BMI Supply & Demand Forecasts

Divided into sections based on various diverse sectors in the agriculture market, the chapter provides insight into each market’s agricultural industry, centred on sector forecasts to end-2019 for the consumption, production and trade of key commodities.

  • Consumption Forecasts: Accompanied by a discussion of the main drivers of consumption growth: macroeconomic factors, food processing trends, price movements and increasingly, demand from the non-food sector.
  • Production Forecasts: Examine the trends influencing BMI’s production outlook: global demand, price increases, public and private sector investment and agricultural efficiency improvements.
  • Trade Forecasts: Accompanied by a discussion of the factors influencing a country’s trade in agricultural goods, including domestic demand, global prices and government trade policies.
  • BMI’s Forecasts: Accompanied by a risks-to-outlook assessment, which examines potential factors that could affect our existing forecast picture and the likelihood of their occurrence.

BMI’s Commodity Price Analysis

Fundamental and technical analysis of the short- and medium-term price outlook for eight agricultural commodities based on globally recognised benchmarks.

Downstream Analysis

Analysis of headline food and drink forecasts, including total food consumption, per capita food consumption and total sector trade, which provide important downstream intelligence for primary agricultural producers.

Featured Analysis

Includes relevant articles from BMI’s daily analysis service. These can include: long-term projections on agricultural imports and exports; our perceptions of the impacts of economic slowdown on key companies and subsectors within the Agribusiness industry in a given country; our analysis of fertilizer production; as well as other relevant analysis of recent news and events.

Competitive Landscape

The reports contain information on prominent companies operating in each market.

Key Commodities Covered By The Agribusiness Market

Reports Include: Grains, Dairy, Livestock, Rice, Sugar, Palm Oil, Edible Oils, Coffee, Cocoa, Cotton, Soybean

Please note – not all reports cover all commodities.

Sources

The Agribusiness reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.