Mar 27, 2023
China Buys 70% of Brazil's Soybean Exports and 63% of Iron Ore
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
The Brazilian president was scheduled to meet with his Chinese counterpart this week in Beijing to discuss bilateral trade issues, but President Lula had to cancel his participation due to a case of mild pneumonia. His trade team, including the Ministry of Agriculture, will continue with the trade mission and meet with President Xi Jinping.
Relations between the two countries is symbiotic, China needs Brazil's commodities and Brazil needs China's business. China is the destination of over one-quarter of Brazil's exports accounting for more than 90 billion dollars in 2022. Brazil has a balance of trade surplus of 30 billion dollars with China, which is half of its trade surplus.
Soybeans were the number one product that Brazil exported in 2022 with China accounting for 70% of Brazil's soybean exports. Petroleum was the second biggest export with 40% going to China. Iron ore was the third place with 63% destined for China.
Over the last ten years, Brazil's soybean exports to China have doubled, petroleum exports have increased 300% and iron ore exports have increased 40%. Beef exports have increased 7,140% from 17,000 tons ten years ago to 1.2 million tons in 2022.
Soybeans, beef, cellulose, sugar, poultry, cotton, and pork are seven of the ten most exported products to China earning 48 billion dollars in 2022. The export of petroleum and iron ore to China brought in 35 billion dollars in 2022.
Corn was not one of the agricultural commodities that Brazil exported to China in any significant quantity in 2022, but that will change in 2023. In mid-2022, Brazil and China finalized phytosanitary standards for Brazilian corn to be exported to China and last November, China gave the green light for corn imports from Brazil. It is not known how much corn China will import from Brazil, but some estimates have it as high as 10-15 million tons annually.