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soybeans on front line as trade war erupts

Yet the tariff will also be damaging to China, said Even Pay, a senior agriculture analyst with Beijing-based advisory firm China Policy. 'In the short term, China is likely to look to make up for soy imports from anyone willing to sell, with Brazil, already the world’s largest soybean producer, likely to benefit. But China’s big farms are much more dependent on bulk commodity feeds than many realize. Brazil can’t export enough to meet their needs, and they can’t easily make up the lost feed with scraps from elsewhere.' The tariffs are nevertheless a boost for Brazil, which appears to be buying U.S. soybeans at cut prices while exporting its own produce at higher rates. Last month, China’s Ministry of Finance announced that it will remove tariffs on soybeans from five countries, including India and Bangladesh. But because these countries are not major soybean producers, the move was largely symbolic, Pay said. 'There is a lot of chatter in Chinese media and policy circles about reducing China’s dependence on a few suppliers such as the U.S. by boosting agriculture projects among countries participating in the Belt and Road Initiative,' Pay said, referring to China’s major infrastructure development push. 'Long term, the soybean tariff will help garner support for Belt and Road projects.'

How the China-US trade row might pave the way for the soybean Silk Road

And the longer the dispute with Washington goes on, the more these emerging sources will have to gain. 'The trade war with the US is generating really good press for the agricultural investment strategy along the Belt and Road,” said Even Pay, a senior analyst at Beijing-based consultancy China Policy. “[The trade war has] made the case for diversifying import partners really concrete, so policymakers and companies that may have been sceptical before are now seeing a lot of evidence that over-dependence on any single supplier of agricultural products is risky.'

learning from Japan’s ‘lost decade’

In late-2016, China’s international buying spree was paused in the face of a crackdown, while Anbang, one of the country’s largest overseas direct investment (ODI) players, wound up falling under state control earlier this year. Despite what it may look like, Beijing wants its companies to continue investing overseas – as long as they have economic planners to keep them ‘rational’. Erlend Ek and Sophie Hassam from China Policy explain the rules that will guide Chinese investment overseas and force it to conform to national economic priorities and geopolitical strategies.

green shoots in the desert as China creates rice paddy fields outside Dubai

Researchers currently grow the seawater rice in the salty beaches of Qingdao, on the Yellow Sea, but 20 million hectares of Chinese wasteland - an area the size of Great Britain - has been identified for cultivation. Even R. Pay, a senior analyst with Beijing-based consultancy firm China Policy, described the Dubai experiment as 'a significant breakthrough'. However, Ms Pay said there were significant barriers to making the new crop varieties widely available, mainly concerning regulation and funding the development of the plants in poor regions. 'Farmers in areas with highly saline soil or water supply, or that are impacted by rising sea levels, are likely to be among the poorest,' she told The Telegraph. 'Ensuring they have means to access this new variety will be a key step in realising its full potential.' [...] And observers say that poor, developing nations have massive incentives to back Beijing's new 'rice diplomacy'. 'The more China imports food from abroad, the more they have a strategic interest in ensuring their trade partners are food secure as well,' Ms Pay said.

China-US trade war is making American soybean farmers anxious

Regardless of how this trade conflict resolves, analysts said US farmers should prepare to share the China market with other nations. 'At the end of the day it is not in China’s interest to expand agricultural trade with the US exclusively,' Even Rogers Pay of China Policy, a Beijing-based consulting group, said. 'It would leave China more dependent on a single, powerful trade partner for a necessity: food.'

can deserts become rice paddies? Chinese scientists say yes

China is not the only country facing the issue of overly salty soil. Around the world, there are around 2.35 billion acres of 'highly saline' land. And the number is increasing because of rising sea levels and changes in precipitation caused by climate change. 'Probably only a fraction of the world's saline land could be brought into production with seawater rice, but that would still have a very substantial impact on food security, not just in China but also around the world,' Even R. Pay, a senior analyst with Beijing-based consultancy firm China Policy, told Inkstone.

China’s financial liberalisation: fact or fiction?

'The challenge for China is control,' said Erlend Ek, at Beijing-based advisory firm China Policy. 'There are bubbles in the economy and if you open up too fast you might lose control of managing these bubbles.'

exclusive: China ramps up checks on U.S. pork imports in potentially costly slowdown

China’s General Administration of Customs, which oversees food imports, did not respond to a fax seeking comment. Increased checks on U.S. products are 'not terribly surprising,' said Even Rogers Pay, an agriculture analyst at China Policy, a Beijing-based consultancy. 'In a situation where trade tensions are high, China will enforce every possible regulation on its books. It makes strategic sense to do so at this point,' she said.

scientists in China race to edit crop genes, sowing unease in U.S.

While China historically has lagged behind other countries’ agricultural research, “in Crispr, they could leapfrog,” said Even Rogers Pay, agricultural analyst for Beijing-based research and advisory firm China Policy. China is also seeking a lead in gene editing in human medicine and livestock, in some cases pursuing research with fewer regulatory restrictions than U.S. counterparts.

China’s reform pledges fail to impress

Chinese strategists see trade frictions as a fight for dominance in the next wave of technologies such as big data, cloud computing and artificial intelligence (AI), said China Policy’s Ek. 'It is not about now, but it is really about the future in 2025-2030. It is about getting there first,' Ek said. 'I think the U.S. is quite scared of China and this state-supported model. Traditionally it hasn't been very efficient, but they see that it has got some results because they have this massive population.' China's massive population and market is a huge advantage in developing data, AI and so on, Ek said. It is a huge carrot that the Chinese government can use to compel foreign companies to accept strong-arm tactics on market access. It is also large enough to nurture information technology companies in a protected environment at home until they are ready to go abroad.

in a trade war, China might boycott U.S. goods. That could backfire

'The U.S. multinationals have been playing a very critical part of China’s development story, providing investment, technology, brands,' said Erlend Ek, trade research manager of China Policy, a Beijing-based advisory firm. 'They have a very good relationship with each other.'

China traders, farmers shrug off risk of US soybeans tariff

China has already been looking for alternative soy sources in places like Brazil, Canada and Russia, and the tariffs could help reduce Chinese dependence on U.S. suppliers, says Beijing-based trade analyst Erlend Ek. 'The discussion at the moment in China is a confident one. They think they can weather out the effects of these extra tariffs. Tariffs aren’t stopping imports, it’s just making it more expensive,' Ek said. 'They’re willing to bite that pill.' The soybean tariff is part of a carefully-targeted strategy by Chinese President Xi Jinping to strike at the heart of Trump’s base, Ek says, while minimizing risks to the Chinese economy.