Is There "Large Country Effect" In China's Grain Import Trade?

Since China joined the WTO,the scale of the grain trade has been increasing.The international community had a doubt that China's grain import trade impact the grain prices of the international market,which means there is "large country effect".This paper analyzes the current situation of China's grain imports on the four major Grain Types.It was found that since 2000,China's grain production and consumption volumes have different degrees of growth,and the most obvious is that soybean production and consumption gap has been increasing year by year.Grain imports increased significantly,while exports decreased overall,and the net import of soybean has been increasing year by year.In addition,soybean also has a high import dependency and high international market share of import.By analyzing the structure of import source countries of each grain variety,it was found that the characteristic of concentrated import exists each grain variety.In order to verify the relationships among China's grain imports,domestic and international grain prices,this paper constructs VAR model for each grain variety.Through the empirical analysis of the grain imports,the domestic market prices and international market prices,it was found that besides rice,the imports of remaining three grain varieties have certain relationships with the international market prices.Therefore,excluding rice import trade,and validating the "large country effect" of the other three grains further.From the perspective of market power,this paper selected the relevant data from China and the United States to establish the SMR model,which considered from the scale of imports.Though the model,it can study the market power of bilateral trade between the two sides.The empirical results show that the buyer market power of China's wheat was 3.35%,the seller market power of US wheat was 0.81%;China's corn buyer market power was 1.66%,the US corn seller market power was 11.99%;China's soybean buyer market power was 5.77% and the US soybean seller market power was 19.62%.The buyer market power of China's Wheat is slightly higher than seller market power of US wheat,but the figures are so small that the two sides both have no market power.Therefore,the market power of the United States is higher than China's,which can judge that China's grain imports have no "large country effect."To further explain the above conclusions,this paper analyzes the five major factors,including production costs,foreign competition,trade policy,import concentration and international speculation.It also proposes appropriate policy recommendations that China needs to reduce production costs,cut down food waste,optimize the structure of import source countries,use futures markets rationally and improve food security warning systems.