Changes of China’s soybean import market power and influencing factors

ABSTRACT

Whether Chinese soybean importers can keenly grasp the changes of different source countries’ market power, will directly affects the safety and cost of soybean import. Based on the analysis of changes in China’s soybean import trade structure, this paper utilizes monthly data from January 2009 to December 2021, combines with the residual demand elasticity model, to compare and analyse the market power of the three major source countries. The results show that although the United States is no longer China’s largest soybean import country, its market power in China’s soybean import market has not been affected, while Argentina’s market power is gradually increasing. Although Brazil has grown into the first source of China’s soybean imports, it has only weak market influence. In addition, China, as the world’s largest buyer, doesn’t have market power. China’s soybean import price is mainly affected by futures prices, domestic soybean prices, international crude oil prices, Sino-US trade frictions and COVID-19 epidemic.

KEYWORDS:

• Soybean import market structure
• market power
• oligopoly competition and monopoly
• market structure

JEL CLASSIFICATION:

• F12
• Q13

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ Data source: domestic data are from the National Bureau of statistics, and international data are from the uncomtrade database.

² Before 2013, U.S. is China’s largest import partner, later is Brazil.

³ Self-sufficiency rate = annual soybean production / annual soybean consumption, import concentration = trade volume / total import volume of the top three import countries. This paper refers to the top three countries, namely the United States, Brazil and Argentina.