news, features, articles and disease information for the crop industry

Does the Smithfield Acqusition Impact China's Corn Import Program? - 4 June 2013

You are receiving this email as you are a subscriber of
The home of premium international crop news and information.
Is this email not displaying correctly?
View it in your browser.
Wednesday 5th June 2013.
Sarah Mikesell - TheCropSite Senior Editor

Sarah Mikesell
Senior Editor

Does the Smithfield Acqusition Impact China's Corn Import Program?

Greetings! My colleagues always tease me that if they want to know the weather, they just look at my e-newsletter. And it’s true, I admit it – I’m a weather watcher. I think that being a farmer's daughter - it’s just ingrained in me. I realized early on that despite our complete lack of control over the weather - as grain and livestock farmers - it had an enormous impact on our lives and our livelihood. And as with much of our life, the best you could do was prepare and plan around it.

In that spirit… much of the Midwest saw more rain last week, with heavy rainfall and flooding hitting some areas over the weekend. At this point, the soybean market and plantings are feeling the pinch more than corn. According to Monday's USDA’s Crop Progress Report, corn is now 91 per cent planted compared to 86 per cent planted last week and the 5-year average of 95 per cent planted.

US soybean planting progress is reported at 57 per cent – right in line with trade expectations. This is up from 44 per cent planted last week, but well below the 5-year average of 74 per cent planted.

Weather, technicals and tight old crop supplies are all impacting the soybean market. Weather forecasts show rain moving into the Midwest midweek and then again over the weekend. Analysts said delays in planting beans are not extremely critical for new crop production but create the concern about filling the demand for beans early this fall.

The big news last week… China's Shineway (Shuanghui International Holdings Ltd.) has agreed to purchase Smithfield Foods Inc., the largest hog and pork producer in the world, leaving much speculation for a rise in US pork exports to China.

But what does it mean for the grain market? The US Grains Council said the resulting increased pork import program is unlikely to hold off China's expected future corn import program.

Dr. Bryan Lohmar, USGC director in China, says it will be extremely difficult for Shineway to significantly increase US pork exports to China simply through its control of Smithfield.

"Let's say Shineway seeks to increase US pork to China by 1 million metric tons per year. Even if it does somehow manage to increase production and meet such an ambitious export target, that much additional imported pork would displace only 3-3.5 million tons (118-138 million bushels) of corn demand in China, or less than 2 percent of China's total corn demand," he said. "Considering USDA forecasts nearly 20 million tons (787 million bushels) of annual corn imports in China within the next 10 years, even this large hypothesized increase in pork exports would only reduce projected imports by less than 20 percent."

Lohmar also noted that boosting US pork exports by such a large amount will be difficult for both physical and political reasons. Smithfield's total US pork production is estimated at just over 2 million tons in 2012.

"Expanding production by an amount significant enough to put a sizeable dent in China's corn import program would require enormous growth. This growth would take time, require new facilities, and would almost certainly be faced with environmental and other interests that are already challenging the expansion of large swine operations in the US," said Lohmar.

Such an increase in China's pork import program would also be challenged by China's large and rapidly growing modern pork industry, particularly if it comes from only one player, Shineway.

Have a great week!

The 5m Crop App is now available on your mobile.

Get the latest international crop news, in-depth feature articles, event details and more, delivered direct to your mobile device.

It's free and automatically optimised, giving you the best user experience.

TheCropSite Book Focus

Biopesticides Pest Management and Regulation - Paperback Biopesticides Pest Management and Regulation - Paperback
This book explores the use of biological control utilising natural predation, parasitism or other natural mechanisms as an environmentally friendly alternative to chemical pesticides.
Order Now Online

Raising Beef Cattle For Dummies Crop Adaptation to Climate Change
Crop Adaptation to Climate Change covers a spectrum of issues related to both crops and climatic conditions. It explores crop physiological responses to climate change by region, and the current genetic research to enhance adaptation.
Order Now Online

This Week's Articles and Analysis

No-Win Situation for Agricultural Expansion in the Amazon
The large-scale expansion of agriculture in the Amazon through deforestation will be a no-win scenario, according to a new study.

New Method for Evaluating Threats to Soil Biodiversity
There is a lack of baseline data regarding soil biodiversity, which means that it is almost impossible to determine what impact pressures such as climate change, agricultural intensification or soil erosion are having on soil species.

Improving 'Crop Per Drop' Could Boost Global Food Security, Water Sustainability
Improvements in crop water productivity — the amount of food produced per unit of water consumed — have the potential to improve both food security and water sustainability in many parts of the world, according to a study published online in Environmental Research Letters May 29 by scientists with the University of Minnesota's Institute on the Environment (IonE) and the Institute of Crop Science and Resource Conservation (INRES) at the University of Bonn, Germany.

Discovery of Ancient Diet Shatters Conventional Ideas of How Agriculture Emerged
They have uncovered evidence for the first time that people living in Xincun 5,000 years ago may have practised agriculture – before the arrival of domesticated rice in the region.

Assessing Risk Level of Leaf Spot Diseases in Wheat
Leaf spot diseases can decrease wheat yield by up to 20 per cent or more, as well as diminish kernel weight, and in some cases reduce grade.

Market Reports

USDA GAIN: Thailand Weekly Rice Price - 29 May 2013
USDA GAIN: Egypt Sugar Annual 2013
China Wholesale Prices - 29 May 2013
China Wholesale Prices - 30 May 2013
China Wholesale Prices - 30 May 2013
China Wholesale Prices - 31 May 2013
IGC Grain Market Report - May 2013
USDA Agricultural Prices - May 2013
USDA GAIN: Thailand Weekly Rice Price - 3 June 2013
USDA Crop Progress - 3 June 2013

Global Crop Industry News

   United Kingdom

Study Show Messy Parts of Farm Provide Vital Habitat
Major Arable Issues to the Fore at Cereals 2013
NFU Takes #buybritish Message to Millions
Study Helps Farmers Invest in Renewables
BCPC Congress Registration Now Open
High Level Lobby Event Brings CAP Concerns to Fore
Advice for Future Wheat Research Published
Global Food Security Report Argues Against Renewables
Call to Curb Food Waste - Support Small Farmers

   United States

Project Aims to Biofortify Rice for Improved Nutritional Value
CME: Corn Futures Closed Higher Tuesday
Wyckoff's Weekly Update: Weather Posed to Drive Markets Higher
Focus Shifts to Soybean Planting Progress
Grains: Where are the Stops? Wednesday, May 29
Jim Wyckoff's Wednesday Closing Grains: Soggy Weather Limits Selling Interest
CME: Corn, Soybean Plantings Behind Schedule
CME: Corn Futures Closed Lower Wednesday
Grains: Where are the Stops? Thursday, May 30
Corn Plantings, Potential Yields on Track After Texas Frosts, Freezes
Researchers Help Threatened Wheat Crops in Asia, Africa
Indiana Farmers Now Ahead of Five-year Pace in Planting Crops
Flooding Forecast for Mississippi River
CME: Corn Futures Closed Lower Thursday
Grains: Where are the Stops? Friday, May 31
GeoGrain: Soybean Basis Has Follow Through Weakness
Grain Hedge: Markets Remain Range Bound Amid Demand, Weather Concerns
US Agricultural Trade Forecast Down but Still Record
USDA Investigates Detection of GE Glyphosate-resistant Wheat
How Will Flooding, Saturated Soils Affect Crops?
CME: Corn Futures Closed Higher Friday
Grains: Where are the Stops? Monday, June 3
Jim Wyckoff's Monday Closing Grains: Soybeans Sharply Higher on Weather
Nitrogen and the 2013 Corn Crop
Delayed Soybean Planting: Prospects for Insect Injury
CME: Corn Futures Closed Lower Monday
Grains: Where are the Stops? Tuesday, June 4
Jim Wyckoff's Tuesday Closing Grains: Soybeans Lower Amid Profit Taking
Wyckoff's Weekly Update: Weather Drives Soybean Market
Using Science to Address Farm Pollution
CME: Corn Futures Closed Higher Tuesday


Fusarium Resistant Wheats Expected to Benefit Prairie Pork Producers
Basis Signals for Canada's Canola Marketers
AC Emerson Expected to Displace CDC Falcon as Predominant Canada Western Red Winter Wheat
Alfalfa Toxicity Affects Seedling Emergence and Growth

   European Union

No Cap Deal Could Delay Reform for Years
EFSA Assesses Risks to Bees from Fipronil


Jim Wyckoff's Morning Report: Overnight Trading Weaker
Yield-enhancing Technology for Developing Countries
Jim Wyckoff's Morning Report: Grain Markets Weaker Overnight
AccuWeather Summer Forecast: Dry in Eastern Europe; Cool in UK, France
Jim Wyckoff's Morning Report: Markets Higher in Overnight Trading
FAO/IFIF Feed Manual Published in Arabic
Jim Wyckoff's Morning Report: Soybeans Lead Way in Higher Overnight Markets
Jim Wyckoff's Morning Report: Key 'Outside Markets' Bearish Overnight


Minister Acknowledges Parliament's Positive, Helpful Engagement on CAP Reform


How Germany is Restricting Harvest Losses

   Russian Federation

Cherkizovo Completes a Sowing and Plans Increase Grain Harvest


Favourable Weather Boosts Prospects for 2012/13 Winter Crops


Agribusiness Logistics in Brazil – the Road to Ruin?


Peru Cereal Production in 2013 Close to Last Year's Record

The Pig, Poultry, Beef, Fish, Dairy, Meat, Cattle, Crop & Bioenergy Sites From 5M Publishing From 5M Publishing

unsubscribe from this list | update subscription preferences

Our Sponsors