Assessing the impacts of meteorological factors on soybean production in China: What role can agricultural subsidy play?

Cereal and oilseed crops possess significance in meeting global food security. China, housing the most number of people, remains the top importer of oilseed crops (i.e., soybeans) to produce energy and meet its food needs. With such significance, the present study investigates the impact of meteorological factors on soybean production in China using the annual data from 1978 to 2020. It also incorporated other essential determinants of soybean production, such as agricultural subsidy, cultivated area, and fertilizer use. For data analysis, it employed the autoregressive distributed lag (ARDL) method and the Quantile Regression (QR) technique. The findings from an ARDL model unveiled meteorological factors such as the yearly average temperature and CO2 emissions declined soybean production in the long-run and short-run analysis, whereas the yearly average precipitation improved soybean production. Besides, agricultural subsidy, cultivated area, and fertilizer use also enhanced soybean production in the long-and short-run analyses. In addition, the findings from the Quantile Regression (QR) technique showed that temperature and CO2 emissions negatively affected soybean production in each quantile (i.e., 0.1-0.90), while precipitation and agricultural subsidy positively augmented soybean production across all quantiles (i.e., 0.1-0.90). Based on these results, the study provides clear policy implications, such as governments should provide crop-specific subsidies instead of input-based subsidies to embolden the impact of agri-cultural subsidies. Also, ecological improvement campaigns should be launched to attract farmers' attention to sustainable agriculture practices to meet meteorological challenges.