BEIJING (Reuters) - Animal feed makers in China, the world’s top soybean buyer, will find ways to cope if a deepening trade dispute with the United States hurts imports of U.S. oilseed, the chairman of the nation’s top feed maker New Hope Group said on Saturday.
U.S. President Donald Trump announced plans on Friday to impose hefty tariffs on imported steel and aluminum, stirring concerns of retaliation from major trade partners such as China, the world’s top agricultural market.
Last month, Beijing fired a salvo across its top trading partner’s bow when it launched an investigation into U.S. imports of sorghum, a grain used in livestock feed, and the fiery Chinese liquor baijiu after Washington slapped import penalties on washing machines and solar panels.
Business executives say Beijing could now target more critical agricultural commodities, such as soybeans, the United States’ biggest agricultural export by value, worth more than $12 billion last year.
Liu Yonghao said he hopes the world’s top two economies avoid a trade war, but “we will be able to find ways” to cope if soybeans are drawn into the spat.
He is the first senior executive from a major Chinese agricultural company to speak publicly about the impact of a trade war on the country’s vast farming and livestock sector.
Analysts have warned that curbing U.S. bean imports or imposing tariffs on them would likely increase prices of the oilseed, which is used to make animal feed, hurting China’s crushers, feedmakers and pig farmers.
The country doesn’t grow enough soy to feed its vast livestock industry.
“We will produce feed as usual. We will produce pigs as usual. And Chinese people will eat meat as usual,” Liu said at a company briefing ahead of China’s annual parliament meeting which kicks off on Monday.
Earlier in the briefing, he signaled Chinese buyers would likely find alternative supplies to the United States.
“The market is huge. There are other countries other than the United States,” he said.
He didn’t comment any further, but farmers, traders and analysts have said that Brazil, the world’s largest exporter of agricultural goods including soybeans, beef and sugar, could benefit if the spat escalates.
The South American country has already grabbed a bigger share of the lucrative Chinese market over the past year from the United States, helped by competitive prices as well as the high protein content of its beans.
China is the globe’s largest soy importer and last year bought 95.5 million tonnes of the oilseeds, more than half from the South American nation.
New Hope has the capacity to produce 25 million tonnes of feed a year.
Reporting by Hallie Gu and Josephine Mason; Editing by Stephen Powell