A friend recently sent me a Bloomberg article about China’s efforts to diversify agricultural imports. The idea is to lessen the reliance on the US in anticipation of trade friction under the Trump administration.
Central and South Americans seem to be on the way to becoming the major winners. They have a surplus of agricultural products that China imports, such as grains, oilseeds, red meat, wine, and nuts. The African continent has not benefitted much.
I have recently discussed President Trump’s trade policy’s possible impact on agriculture and how China retaliated against his administration’s tariffs in 2018. The Chinese retaliation hurt the US soybean, maize, and pork farmers at the time.
What we can expect in the coming months will depend on whether President Trump proceeds with the higher tariffs on China, he promised in his recent speeches.
What is clear now is that South America, like in 2018, may be amongst the winners as China searches for new sources of agricultural products.
South Africa’s standing
However, South Africa should also position itself among the key suppliers of agricultural products to China in addition to its current export activity.
I sometimes doubt if South Africans appreciate enough how big China is in global agricultural trade; thus, we keep discussing it. China is a dominant player in the export and import of agricultural products.
In 2023, China was a leading agricultural importer, accounting for 11% of global agricultural imports, which totalled over US$200 billion. The US, Germany, the Netherlands, the UK, France, and Japan trailed China.
Similarly, China played a notable role in exports. In 2023, it was the fifth-largest agricultural exporter in the world. The leading countries ahead of China were the US, Brazil, the Netherlands, and Germany.
Few African countries benefit from these imports due to low agricultural productivity in Africa. Most don’t have volumes to export.
The leading suppliers of agricultural products to China are Brazil, the US, Thailand, Australia, New Zealand, Indonesia, Canada, Vietnam, France, Russia, Argentina, Chile, Ukraine, the Netherlands, and Malaysia.
The only African country in China’s top 30 agricultural suppliers is South Africa, which ranked 28 in 2023. Still, South Africa remains a negligible player in the Chinese agricultural market, accounting for a mere 0.4% (US$979 million) of China’s agricultural imports of US$218 billion in 2023.
Sudan and Zimbabwe are other African agricultural suppliers to China, ranked 33 and 34, respectively.
Given this reality and China’s efforts to diversify its agricultural suppliers, it is key that the South African message in engagements with the Chinese authorities should be more firm and persuasive in promoting agricultural exports.
South Africa has an agricultural surplus each year, exporting about half of its yearly production. In 2023, South Africa’s agricultural exports amounted to a record US$13.2 billion. Indeed, this is nowhere close to the amount of money China spends annually importing agricultural products from the world, a staggering US$218 billion.
China is already one of South Africa’s major agricultural markets for a variety of fruits, wine, red meat, nuts, maize, soybeans, and wool. However, there is room for more ambitious agricultural export efforts.
The South African agricultural sector—organized agriculture and researchers—consistently points out the need to lower import tariffs in China and remove phytosanitary constraints on various products. From now on, this should be a topic of conversation in engagements with Chinese authorities.