Development Status of China’s Seed Industry in 2023

China is the world’s second-largest seed market, trailing only the United States, with annual seed consumption of approximately 12 million tons and a market value of US$19 billion. Among the seven major crops—corn, rice, wheat, soybeans, cotton, potatoes, and rapeseed—seed usage totals about 10 million tons, accounting for a market value of US$13.5 billion. The commercialization rate of seeds for China’s major crops stands at roughly 70%, with the remaining seeds sourced from farmers’ own saved seed from the previous season. Market shares for commercial seeds vary by crop, with cotton commanding the highest share at 88% and potato seed potatoes the lowest at 40%. According to official reports, China has achieved self-sufficiency in rice and wheat seeds, and is nearly self-sufficient in corn and soybean seeds. Although domestic vegetable varieties continue to improve, they still fall short of meeting the market’s growing demand for diversity, leaving 15% of China’s vegetable seed supply dependent on imports.

The Ministry of Agriculture and Rural Affairs’ “2022 Report on the Development of China’s Crop Seed Industry” (hereinafter referred to as the “2022 Seed Report”) indicates that seed usage is following distinct trends. Corn seed application has slowed, declining from 28.65 kg per hectare in 2017 to 26.5 kg per hectare in 2021, primarily due to the growing adoption of precision farming technologies. By contrast, hybrid rice seed use increased from 16.8 kg per hectare in 2017 to 18.2 kg per hectare in 2021, driven largely by the expansion of mechanized rice‑cultivation areas. Wheat seed yield rose from 187.4 kg per hectare in 2017 to 214 kg per hectare in 2021, mainly attributable to higher seeding densities.

According to the Ministry of Agriculture and Rural Affairs’ “2022 Seed Report,” as of the end of 2021, there were 7,668 seed enterprises holding valid business licenses. Among them, 1,920 were engaged in the corn seed business; 1,182 in rice seeds; 1,356 in wheat seeds; 506 in soybean seeds; 202 in cotton seeds; 519 in rapeseed; 430 in potato seed potatoes; 312 in peanut seeds; and 2,638 in melon seeds. (Note: The total exceeds 7,668 because some companies produce multiple types of seeds simultaneously, such as both corn and soybean seeds.)

Seed Market

In March 2023, the National Agricultural Technology Extension Service Center released the 2023 supply-and-demand data for major crop seeds at the 19th National Seed Information Exchange and Product Fair (with the marketing year for all crop seeds running from October to September of the following year). The key highlights are as follows:

☞ Corn

With the expansion of corn seed‑planting acreage, China’s hybrid corn seed production for the 2022/23 marketing year (October–September) is projected at 1.36 million tonnes, up 31% from the 2021/22 season. According to statistics from the Ministry of Agriculture and Rural Affairs, hybrid corn seed acreage increased by 35% in 2022/23, reaching 244,000 hectares—the highest level in the past six years. This substantial growth was largely driven by low seed inventories. Affected by adverse weather conditions in the major producing regions of Northwest and Southwest China, the national average yield of hybrid corn seeds in 2022 stood at 5,580 kg per hectare, near the median level of the past five years. Gansu Province remains China’s largest producer of corn seeds, accounting for approximately 48% of the country’s total hybrid corn seed area in the 2022/23 season.

China’s total maize seed supply for the 2022/23 marketing year is projected at 1.65 million tonnes, with carryover stocks of 290,000 tonnes. According to estimates from the Ministry of Agriculture and Rural Affairs, hybrid maize seed consumption in 2022/23 will reach 1.15 million tonnes, pushing end-of-season inventories up to 500,000 tonnes. On the pricing front, the national average maize selling price is expected to be RMB 35.4 per kilogram, a 14% increase compared with the same period last year. However, industry insiders anticipate a more substantial price hike, primarily driven by a 20% rise in production costs relative to the previous year.

☞ Rice

Due to an expansion in planted area, hybrid rice seed production for the 2022/23 season is projected at 280,000 tonnes, up 5% from the 2021/22 season. According to statistics from the Ministry of Agriculture and Rural Affairs, the area under hybrid rice cultivation increased by 25% in 2022/23, reaching 131,000 hectares. Of this total, early-season rice accounted for 16,100 hectares, mid-season rice for 84,000 hectares, and late-season rice for 31,000 hectares. Owing to adverse weather conditions, the average yield of hybrid rice seeds in the 2022/23 season was 2,160 kg per hectare, roughly 22% lower than the previous year.

The total supply of hybrid rice seeds for the 2022/23 marketing year is estimated at 330,000 tonnes, while total demand (for domestic use and export) is projected at 270,000 tonnes. Driven by higher average seed yields and an expansion in the area under hybrid rice cultivation, demand is up 15% compared with the 2021/22 season. In terms of pricing, the national average selling price of hybrid rice seeds is expected to be RMB 78.44 per kilogram, a 4% increase over the same period last year.

Conventional rice seed production for the 2022/23 season is projected at 1.18 million tonnes, up 24% from 2021/22. The Ministry of Agriculture and Rural Affairs estimates that demand for conventional rice seeds in 2021/22 will reach 602,000 tonnes, a 5% decline compared with the previous year, driven by an expansion in the area planted with hybrid rice. In terms of pricing, the national average selling price of conventional rice seeds is expected to be RMB 10.62 per kilogram, up 4% year on year.

☞ Soybeans

Soybean seed production for the 2022/23 marketing year is projected at 880,000 tonnes, up 17% from the 2021/22 season. China’s soybean seed supply is ample and sufficient to meet domestic demand.

Trade

Due to a decline in the import volume of forage seeds, which account for nearly 80% of China’s total seed imports, China’s seed imports for the 2022/23 marketing year are expected to decrease by 25% compared with the 2021/22 period (see the section on forage seed imports below). Owing to market access restrictions on major food crops such as corn, wheat, rice, and soybeans, as well as China’s goal of achieving self-sufficiency in grain production, the country imports relatively few seeds of staple grains. Vegetables and forage seeds rank first and second among imported seeds, accounting for 78% and 80%, respectively, of China’s total seed import value and volume in the 2021/22 marketing year. The United States remains China’s largest supplier of seeds, representing 28% of the country’s 2020/21 import value for planting seeds, followed by Chile (11%), Denmark (10%), Thailand (6%), and Japan (5%). See Figure 3 below.

☞ Vegetable seed importation

Driven by rising demand for high-end and specialty vegetable seeds in China, the country’s vegetable seed imports are projected to reach 11,500 tonnes in the 2022/23 marketing year, up approximately 10% from the 2021/22 period. Furthermore, according to industry data, China’s vegetable‑cultivated area has maintained a growth rate of 1.5%–2% over the past three years, a trend that is expected to continue in order to meet the nation’s expanding demand for vegetables.

According to data from the Ministry of Agriculture and Rural Affairs, China’s annual consumption of vegetable seeds is estimated at 100,000 tons, with imports over the past five years ranging from 9,000 to 10,500 tons—accounting for approximately 10% of total vegetable seed usage.

Chinese vegetable seed companies are increasingly producing seeds overseas, particularly in South America, where they take advantage of similar climates and off-season conditions, before re-exporting the seeds to China. China’s main imports of vegetable seeds include tomato, broccoli, carrot, onion, and spinach.

In terms of volume, Italy, Thailand, Indonesia, and Denmark accounted for 90% of China’s vegetable seed imports in the 2021/22 marketing year. Although the United States contributed less than 1% of the total import volume, its higher unit price resulted in a 12% share of the total import value, trailing Chile—which also accounted for 2% of the volume but 23% of the value. According to Chinese customs data, the average price of vegetable seeds imported from the United States in 2021/22 was USD 173,984 per ton, compared with USD 314,022 per ton from Chile, while the overall average price paid by all Chinese importers was USD 26,690 per ton.

☞ Grass seed importation

Due to weak domestic demand and high inventory levels, grass seed imports (including alfalfa, rye, fescue, clover, oats, and Kentucky bluegrass) are expected to decline by 35% in the 2022/23 marketing year compared with 2021/22. Despite soaring prices, China’s grass seed imports in 2021/22 did not fall as anticipated, largely because of robust rye grass seed imports, which accounted for 63% of the country’s total grass seed imports. In 2021/22, rye grass seed imports increased by 30%, while the average import price rose by 59% year over year. Notably, driven by reduced production, the price of rye grass seed imported from the United States surged by 80%.

Despite higher prices, concerns over supply shortages and expectations of strong sales in the 2020/21 season have prompted importers to build up inventories. Chinese buyers increased purchases from Argentina, Denmark, and New Zealand while reducing imports from the United States. As a result, China’s rye grass seed imports from the U.S. fell by 28% in the 2021/22 marketing year, whereas imports from Argentina, Denmark, and New Zealand rose by 538%, 62%, and 60%, respectively. However, due to the pandemic and economic downturn, demand for grass seeds—including both forage and turf—remained weak in 2021/22. High import volumes have translated into sizable stockpiles, which are expected to further curb imports in the 2022/23 season. According to Chinese customs data, during the first five months of the 2022/23 marketing year, China’s grass seed imports declined by 65% compared with the same period in 2021/22. Industry insiders note that, as import volumes have dropped sharply, inventory levels are shrinking, and they anticipate a rebound in imports in the second half of the year.

In February 2022, the Ministry of Agriculture and Rural Affairs released the “14th Five-Year Plan for National Forage Industry Development.” According to the plan, in 2020 China’s forage‑crop planting area totaled approximately 5.3 million hectares, including 2.5 million hectares of silage corn, 670,000 hectares of oat and rye grass, and 430,000 hectares of alfalfa. China’s forage production is projected to increase from 71.6 million tons in 2020 to 98 million tons by 2025. Although the plan aims to raise the overall self-sufficiency rate of forage seeds—including silage corn seeds—to 70% by 2025, industry stakeholders remain skeptical, given China’s limited capacity in forage‑seed breeding, high production costs, and constrained arable land.

☞ Export

China’s seed exports for the 2022/23 marketing year are projected at 30,000 tonnes, down roughly 10% from the 2021/22 season, driven by a decline in rice seed shipments, which account for more than 70% of China’s total seed exports. In 2021/22, rice seeds represented 76% of the country’s total seed export volume but only 34% of the export value. Meanwhile, vegetable seeds made up 12% of the total seed export volume in 2021/22, yet accounted for 46% of the export value.

China’s hybrid rice seed exports for the 2022/23 marketing year are projected at 22,000 tonnes, down roughly 12% from the 2021/22 period. Industry insiders note that, thanks to investments by Chinese rice seed companies and multinational seed firms in their home markets, traditional importers of rice seeds may reduce their imports and boost domestic production. Pakistan, the Philippines, and Vietnam are China’s largest buyers of rice seeds, together accounting for 97% of China’s total rice seed exports in the 2021/22 season.

China’s vegetable seed exports for the 2022/23 marketing year are projected at 3,900 tonnes, unchanged from the previous year. Industry sources indicate that most of these exports are contracted by foreign firms—foreign companies commission Chinese producers to manufacture specific seed varieties and then export them back to the originating countries—primarily including tomato, lettuce, bean, and cabbage seeds.

The main vegetable seeds exported include tomato, lettuce, beans, and cabbage. Vietnam, the Netherlands, Italy, South Korea, and the United States are the largest buyers of Chinese vegetable seeds, accounting for approximately 55% of China’s vegetable seed exports in the 2021/22 marketing year.

Reference information:

https://www.fas.usda.gov/data/china-planting-seed-2023-annual

Source: National Institute of Agricultural Research