By RICK A. RICHARDS
Indiana Correspondent

ANKENY, Iowa — The future for Iowa soybeans – and much of the nation’s soybean crop, for that matter – lies in the expanding Chinese market, according to a delegation from the Iowa Soybean Assoc. (ISA) that arrived in China March 27 for a five-day visit.

During a teleconference from their hotel in Guangzhou not far from Hong Kong, ISA CEO Kirk Leeds said it was an opportunity to get an up-close look at soybean production in China and meet with representatives of companies that are buying more than 23 percent of the U.S. soybean crop.

Accompanying Leeds on the trip was Grant Kimberly, ISA’s director of market development; ISA President Randy VanKooten of Lynnville; ISA President-elect Dean Coleman of Humboldt; Karen Simon, communications director of the ISA; and Karey Claghorn, Iowa’s deputy secretary of agriculture.

The itinerary included a stop in Taiwan, the world’s fourth-largest market for soybeans; Hainan Island off the southern coast of China, where aquaculture has become a big market for soybeans; the city of Shantou, about 150 miles east of Hong Kong, where soybean shipments arrive at the port of Huangpu; and Guangzhou (formerly known as Canton), a city of more than 14 million people.

“It’s exciting to be in a country of 1.3 billion people,” said Claghorn. “We understand the country is growing by eight million people a year and the GDP is growing at between 8 and 10 percent a year.

“Personal income also is growing and that means people have more money to spend on food. With that, there is more interest in increasing livestock production, and that means more interest in soybeans.”

For Kimberly, the trip was an opportunity to find out more about the growing aquaculture industry. Already China has a partnership with the American Soybean Assoc. for the use of soybeans in aquaculture.

“Right now, aquaculture is using 300 million bushels a year, and that’s up from zero in the mid-(19)90s,” said Kimberly. “Aquaculture is going to have a tremendous pull on the market.”

Coupled with an expansion in feed production for livestock, Kimberly said over the next five years, China is expected to increase its imports of soybeans from 55 million metric tons to 68 million. At the same time, China is expected to increase its importation of corn from four million metric tons to 20 million by 2015.

“There is a lot going on in China,” said VanKooten. “The roads we’ve seen are very good and we had a chance to ride the bullet train. We have noticed that much of the grain that arrives in the country is shipped by boat on the river, but it seems to work very well.”

Leeds pointed out China has a network of three major rivers where ports and docks are plentiful and it’s relatively easy to get products inland from the east coast, where much of the population lives.

Coleman said while the policy of China is to try and become self-sufficient, the country is growing at such a rate that it can’t keep up with demand. Still, he said the Chinese “intensively use their land base.

“It seems that every square foot is used in garden-sized plots. They’re irrigated and plants are the same size and planted in mounds,” he added.
But not one of those small plots he saw, said Coleman, was tilled by modern machinery: “I saw water buffalo, a large rototiller, even an old lady using a spade to turn the soil.”

Leeds, who has made several trips to China, said his conversation with Chinese agricultural officials shows they are concerned about the availability of soybeans and corn.

“Absolutely they are concerned about supply. Availability is the key. They don’t want to be caught on the short side of a supply problem,” said Leeds, adding that the country wants to maintain at least a two-month supply.

One of the reasons there is such a demand for U.S. crops is that acreage and yields in China have not increased over the last few years. “They’re not increasing their bushels per acre like we are,” said Coleman.

In a trip to China last August, VanKooten pointed out that when he traveled in the northeast area of the country, the corn and soybeans he saw planted there looked every bit as good as crops in the United States. To hear China say their crop production was down was surprising, said VanKooten.

Coleman summed up the trip this way. “We’re here trying to get them to purchase more from us. They’re looking for that personal commitment that will show them we can meet their needs.”