Rise in soya bean imports threatens China's cooking oil producers

An increase in the amount of soya beans imported into China to sate the country's demand for cooking oil is threatening domestic cooking oil producers.

China's cooking oil consumption has increased at an annual rate of 10 percent over the last five years and China now consumes 16.4 percent of the world's total, said Chinese Vice Minister of Agriculture Fan Xiaojian at a trade fair in Dalian, in northeast China's Liaoning Province, on Sunday.

The surge in demand has boosted China's oil imports and, according to Fan, China imported a total of 26.6 million tons of beans last year, 68 percent of China's bean consumption. It represented 40 percent of the total world bean trade.

Experts are concerned that the rise in imports will force Chinese bean companies out of the market. In 2004, when many Chinese cooking oil producers imported a large amount of beans at a high price of 3,500 yuan per ton, the subsequent sharp drop in the bean price in China led to domestic companies incurring heavy losses.

Overseas investors began to take over the struggling Chinese cooking oil producers and have gradually dominated the market.

Wang Lianzheng, of the Chinese Academy of Agricultural Science, said the country must establish a sound market system to boost development of the soya bean industry, exploring ways to market domestic bean products.

Wang also urged domestic companies not to import beans blindly in the future so the bean price in China will remain stable.

Source: Xinhua