Beijing is redrawing global trade routes to shield itself from geopolitical risk
A remapping of global commodity flows is underway—driven by strategic security rather than price efficiency. The PRC, the world’s biggest farm importer, is shifting away from old Western partners and toward a new nexus of suppliers in the Global South.
trade turbulence is the new constant
An era of open, price-driven sourcing, which brought two decades of growth to Beijing’s trade partners, is over. Volatility, once mainly driven by weather, is now a fixed fact of trade shaped by sanctions, tariffs, and shifting alliances. Control of routes and the reliability of partners is now what matters most.
Beginning during the 2018 US–China tariff war, Beijing has been steadily building buffers to manage risk through a strategy of ‘managed openness’. Its core rule is diversification, spreading supply chains across regions and currencies to lessen political and logistics threats. This approach was formalised in the 2025 No. 1 Document, which sets up a multi-pronged ‘production-trade coordination mechanism’ that links import volumes to domestic output goals.
It aims to control price volatility at home. State traders like COFCO are adjusting contracts contracts, while strategic storage under Sinograin and COFCO acts as a shock absorber for corn, soybean, and sugar.
The result is a geopolitical split in trade flows. The global market has not vanished, but it has divided. International agribusiness must now run parallel operations to cope with this split
the OECD network complies with Western standards on carbon, deforestation, and traceability
the Eurasia network runs on PRC standards and finance, often tied to the Belt and Road Initiative
Trade now follows political alignment.
the US exit and Brazil’s rise
The rivalry between the world’s two biggest food powers has become a structural contest. Farm trade, once a stabiliser, now reflects the logic of security and control. After high US duties were brought in again early in 2025, the US share of PRC total agricultural imports fell sharply to just 5 percent by September 2025, down from 16 percent in 2025. Trust has dissolved, leading to
zero new US soybean shipments clearing Chinese ports in September 2025
Beijing withholding permit renewals for roughly 300 US beef processing plants
PRC agricultural import by region
This decline is evident in the shift in regional sourcing seen in the chart above. While North America’s share dropped, Latin America and the Caribbean expanded from 33 to 45 percent.
Brazil stands as the dominant supplier, swiftly replacing the US in bulk goods, reinforcing the South American trade axis.
soybeans: Brazil’s share has risen steadily to more than 70 percent
corn: After a 2022 phytosanitary deal, Brazilian corn entered the market at scale. By 2023, Brazil supplied nearly half of corn imports, ending US dominance
beef: Brazil’s share rose from 12 percent in 2015 to nearly half of the total in 2024, overtaking old suppliers
sugar: Brazil now supplies nearly 90 percent of China’s sugar imports
Brazil’s share of PRC agri imports
Brazil’s growing dominance is shown in the bar chart above. The link is expanding from bulk trade to building logistics, with PRC banks funding ports and rail in Brazil. Moreover, roughly 70 percent of Brazil’s 2024 soybean sales to China have been denominated in C¥.
These shifts underscore Beijing’s ambition to control ports, payments, and partners.
Brazil, meanwhile, is careful in promoting a ‘dual compliance’ model that meets both EU traceability and PRC sustainability metrics.
Busan detente
The soybean agreement, struck between Presidents Trump and Xi in South Korea on 30 October 2025, is a political cease-fire overriding strategic goals. China pledged to purchase 12 million metric tons in 2025 and at least 25 million metric tons annually for the next three years, while dropping some retaliatory tariffs. The deal signals political intent but does not change the core cost and quality realities that favour Brazil in the long run.
Eurasia supply corridor
Western sanctions on Russia, once seen as a liability, have instead promoted the building of a continental food and logistics network under Beijing’s leadership. This ‘Russia Corridor’ secures land routes for grain and fertiliser, shielding them from sea disruption.
trade and currency: bilateral agri-trade reached a record US$7.4 billion in 2024. Financial isolation has driven up to 95 percent of this trade to be settled in C¥ or Roubles, routing payments outside the SWIFT network through systems like Beijing’s CIPS (Cross-Border Interbank Payment System)
infrastructure: new rail bridges, like the Blagoveshchensk-Heihe bridge (opened 2022), and customs pacts speed up flows. New rail and port projects, from Russia to Pakistan, shorten delivery times and bypass sea chokepoints. The network includes the Northern Sea Route in the Arctic, cutting transit time to Shanghai, though insurance and ice-risk costs remain high. The system is seen as a strategic supply chain buffer
supply shift: Russia is filling the gap left by Western trade disputes. Russian oil now supplies nearly 60 percent of China’s canola oil imports. Russia’s overall share of China’s farm imports rose to nearly 4 percent in 2025, up from 2 percent in 2019. This continental network now delivers tangible resilience benefits
This continental system is the physical expression of Beijing’s de-risking strategy, linking Russia, Central Asia, and the Arctic into one extended logistical zone where Chinese finance, data, and standards set the terms. The alignment is driven by strategy, not efficiency.
ASEAN’s pragmatic hub
The Association of Southeast Asian Nations (ASEAN) embodies a model of ‘pragmatic interdependence’.
deep integration: the RCEP (Regional Comprehensive Economic Partnership) trade deal, in force since 2022, eliminated tariffs on over 90 percent of agricultural goods traded between China and ASEAN. ASEAN accounts for about 19 percent of China’s farm imports by September 2025, up from 15 percent in 2019. The region is a vital source of feed inputs, processed foods, and fruit
investment: Chinese state firms and construction companies are developing integrated cold-chain networks linking Vietnam, Laos, and Thailand to China’s southwest provinces, often using the China-Laos Railway. ASEAN is tied to China by new rail lines
currency and data: about one-third of bilateral farm transactions now use C¥ or local currencies, supported by the Bank of China’s regional clearing network. QR-based traceability systems allow Chinese customs to verify origin and sanitary data from ASEAN suppliers in real time
ASEAN states maintain a cautious policy of ‘in with all, out with none’. They welcome Chinese demand but diversify partnerships with Japan, Australia, and the US. For Beijing, this relationship provides essential supply while testing how to build influence without forcing political alignment.
the end of the efficiency era
Beijing’s new atlas represents the securitisation of food supply chains. The global food economy is transitioning from a comparative advantage-based system to one defined by strategic resilience. The ‘global price’ is becoming a fiction; instead, prices will ever more carry a geopolitical premium or discount depending on the origin and destination of the cargo.
As Beijing cements its sway over the Global South through infrastructure and currency integration, the friction between these competing trade blocs will become the primary driver of market volatility. Companies can no longer simply sell to the highest bidder; they must align with the political architecture of the buyer.
ag trade experts
Tu Xinquan 屠新泉 l Director UIBE China WTO Research Centre
Tu argues that full decoupling between the PRC and the US is not realistic because production and demand link the two economies. He expects the global economy to shift from a US-led single core to a dual-core structure shaped by the PRC and the US, with indirect links through emerging economies. In his view, the PRC should focus on adapting rather than confronting. This means moving from trade-led engagement to a mix of trade and outbound investment, building diverse partners and managing risk in a more fragmented phase of globalisation.
Tu Xinquan is dean of the WTO Research Institute at the University of International Business and Economics. His work focuses on WTO rules, PRC trade policy and PRC–US economic ties. He has held visiting roles at Johns Hopkins SAIS and the WTO Secretariat and advises on trade policy in Beijing.
Tian Zhihong 田志宏 | Professor, College of Economics and Management, China Agricultural University
Tian says the Russia corridor has shifted from a simple trade route to a strategic supply chain buffer. His research, based on long-term tracking of PRC trade flows with Eurasian states, shows that the rail network now helps firms reduce reliance on sea routes that face geopolitical risk. At the same time, renminbi clearing helps cut exposure to Western finance. He argues that the corridor’s value lies in improving supply resilience, predictability and room to hedge risk, as well as faster trade. Tian sees this as a model for other Belt and Road trade routes.
Tian’s work covers PRC–global farm trade, food markets and supply resilience. He has led more than ten major projects under the National Natural Science Foundation and National Social Science Fund. His research shapes policy debate on PRC–Russia economic ties and Belt and Road food trade. Professor at the College of Economics and Management at China Agricultural University, Tian also serves on national advisory bodies linked to PRC agricultural trade.
Xu Ningning 许宁宁 | Executive President, China–ASEAN Business Council
Xu says ASEAN is the core focus of the PRC’s neighbourhood diplomacy and the most dynamic area of its food and farm trade. He notes that RCEP has sped up trade growth and helped build a linked food economy across the region. In his view, this shift goes beyond a buyer–seller model. Instead, it reflects a shared food chain in which production, processing, and consumption span borders. Xu points to years of practical business work, including the roll-out of trade links that brought Cambodian longan and Vietnamese durian into the PRC market. He argues the next step is to deepen value chains using digital platforms and cross-border e-commerce, and to use smart farming to build long-term shared gains.
Xu is chair of the RCEP Industry Cooperation Committee and executive president of the China–ASEAN Business Council. ASEAN embassies in Beijing recognise him as a leading specialist on ASEAN–PRC economic ties. Working in ASEAN–PRC trade for over thirty years, Xu has helped shape business forums under the China–ASEAN Expo and has written over twenty books on ASEAN–PRC trade. His work has supported deeper trade and investment links in the food and farm sectors under RCEP.