The politics of flexing soybeans: China, Brazil and global agroindustrial restructuring

Abstract

The political geography of the global soybean complex is shifting. While the complex has long been controlled by US-based transnational corporations, new agribusiness actors, business logics and power relations rooted in South America and East Asia are emerging, based in part on commodity flexing. We explore how soybean flexing is shaping and being shaped by global restructuring of the soybean processing industry. Using the divergent histories and uses of soy in China and Brazil, we propose that in order to understand the changing soy landscape, we must examine the relationships between soy's multiple-ness and flexible-ness, the political economy of soy processing, and the relationships between crop ‘flexors’ – those powerful firms that control the soy complex – with each other and with governments. We demonstrate that the agribusiness actors who are gaining more control over the soy complex are doing so in part through flexing, and that the ability to flex may ultimately determine the trajectory of global agroindustrial restructuring. Finally, we raise questions and make suggestions for further research on flex crops.

Keywords:

• flex crops
• soy
• agribusiness
• biodiesel
• meatification
• livestock-feed complex
• China
• Brazil

Acknowledgements

We would like to thank the participants in the flex crops workshop organized by TNI in January 2014 at ISS in The Hague for their helpful discussions and insights, and the anonymous reviewers for their suggested improvements.

Notes

¹Translation by Gustavo Oliveira from Martinez (2014), cf. Lovatelli (2014).

²Annual soybean production has increased from 26.8 million metric tonnes in 1961 to 285 million tones in 2013, an increase of almost 1000 percent (FAOSTAT n.d., USDA 2014). Similarly, soy was cultivated on 23 million hectares in 1961, rising to almost 105 million hectares in 2012.

³Among the industrial uses of soy proteins and oils are: adhesives, analytical reagents, antibiotics, asphalt emulsions, anti-corrosive agents, anti-static agents, binders for wood/resin, caulking compounds, cosmetics, core oils, disinfectants, dispersing agents, dust control agents, electrical insulation, epoxies, films for packaging, foams and anti-foaming agents, fungicides, herbicides, inks and crayons, insecticides, linoleum backing, leather substitutes, metal casting, oiled fabrics, paints, plastics and plasticizers, plywood, protective coatings, polyesters, pharmaceuticals, putty, rubber manufacture, soaps/shampoo/detergents, textiles, vinyl plastics, waterproof cement and wallboards (Iowa State University 2007b).

⁴Interview by Gustavo Oliveira, São Paulo, Brazil, May 2014.

⁵There are innumerable processed foods that contain soy products in small amounts, such as soy flour, stock, lecithin, glycerol, fatty acids and sterols. These are used in the production (or low-cost ‘extension') of breads, cookies, pancakes and other bakery products, noodles, cereals and grits, beer and ales, chocolates, candies and confections, frozen desserts, instant milk drinks, toppings, coffee creamers, liquid shortening and yeast, salad dressing/oils, sandwich spreads, vegetable shortening, sausage casings, dietary products, baby food and, of course, mayonnaise and margarine. Soy products are not only used as processed food ingredients, but also as emulsifying or stabilizing agents, shortening and coatings (Iowa State University 2007b).

⁶According to a survey by J.L. Buck, Chinese farmers before 1949 (in other words, most of the Chinese population) received 89.8 percent of their food energy from grains and grain products, 8.5 percent from roots, and only 1 percent from animal products (Hsu and Hsu 1977). Similarly, the ‘Cancer Atlas’ study from the 1970s, upon which Campbell and Campbell's (2006) well-known ‘China Study’ is based, reported that in rural China (again, the majority of the population at the time), only 9–10 percent of calories came from protein, and only 10 percent of that protein came from animal-based foods. Soy was a key protein source.

⁷In 2002, the central government redefined soybean meal and soybeans as industrial rather than agricultural products, changing the tax and tariff structure, and promoting more liberalized trade (Solot 2006).

⁸According to the most recent USDA (2014) report on oilseeds, China has already started to replace India's soybean meal exports in Asia, particularly to Japan, South Korea and Southeast Asian countries.

⁹Interview by Mindi Schneider, Heilongjiang Province, China, August 2011.

¹⁰Interview by Gustavo Oliveira, São Paulo, Brazil, May 2014.

¹¹Estimate based upon ANP/ABIOVE data for total soy-based biodiesel production and the soy oil-to-biodiesel conversion ratio calculated by Cavalett and Ortega (2010).

¹²Measures to support biodiesel include the 2006 Renewable Energy Law and the 2007 Long-term Renewable Energy Development Plan (Baidu Baike 2014).

Additional information

Notes on contributors

Gustavo de L. T. Oliveira

Gustavo de L. T. Oliveira is a PhD candidate in the department of geography at the University of California, Berkeley. He researches social and ecological transformations in the Cerrado region of Brazil, the international soybean complex and global agroindustrial restructuring. His dissertation analyses the political ecology of Chinese investments in Brazilian agribusiness and logistics infrastructure. He is a member of the Land Deal Politics Initiative and the BRICS Initiative for Critical Agrarian Studies. He can be reached at: [email protected]

Mindi Schneider

Mindi Schneider is an assistant professor of Agrarian, Food and Environmental Studies at the International Institute of Social Studies (ISS) in The Hague, Netherlands. With a China focus, her current research is on industrial meat regimes, agroecology and food security politics. She can be reached at: [email protected]