China Corn Purchases Could Exceed 1 Million Tonnes

Matt Hopkins Posted by Matt Hopkins|17 June 2010

CHICAGO, Illinois, US — The US Grains Council (USGC) says China could increase its corn purchases from the US to more than 1 million tonnes during the next 18 months, according to Bloomberg. Thomas Dorr, USGC president, stated that he “wouldn’t be surprised to see it be in fact double that amount.” According to US Department of Agriculture (USDA), China has purchased at least 715,000 tonnes of corn since April for delivery by Aug. 31.

Until last year, China was a net corn exporter. Rain, snow and unfavorable temperatures reduced area planted by 2% in the country, according to USGC. A rising middle class and the addition of more protein to the average Chinese diet has increased corn demand for food and livestock feed. A June 9 forecast from the World Bank estimates a 9.5% rise in China’s GDP this year — nearly triple that of the US and more than 13 times that of Europe.

China’s additional corn purchases will reduce corn inventories, already at low levels due to higher ethanol demand. USDA lowered its world corn supply forecast for the end of the 2010-2011 by 4.5% from a month ago.
 

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