Will the Chinese economic slowdown affect dairy imports?

Published 27 August 15

One of the main questions in the global dairy market at the moment being “when will China start buying again”. It was therefore interesting to see concerns emerge over the week on the state of the Chinese economy.

The graph below shows how the country’s growth has slowed to 7% in recent years, after being up at around 10% for the 30 years previous. The slowdown is believed to have been caused through a combination of an aging population and a reduction in investment growth, amongst other factors.

Chinese slowdown 27.08.15

In the short term, the impact is on trade levels as the country’s central bank has recently devalued the yuan, to the lowest level against the dollar in 3 years, to try to remain competitive. Longer term, it poses the question of whether China will continue to be a powerhouse in driving dairy import trends or if other countries being to take control.