January 27, 2011

China's 2011 US corn imports may hit seven million tonnes

China may import its full quota allowance of seven million tonnes of corn this year in response to rising demand pressures from its livestock industry, while imports of US distillers dried grains (DDGS) may reach three million tonnes, according to the US Grain Council.

The country last month opened an antidumping investigation of US DDGS, a corn-based animal feed of which US exports to China rose nearly five-fold between 2009 and 2010.

While China comes to grips with the demands of food security, feed industry growth of about 8% a year has increased its corn and DDGS consumption, said Thomas Dorr, the president of the US Grains Council.

"I would not be surprised if China imported 7.4 million tonnes of tariff-rate quota corn this year," he added.

However, demand for US DDGS has "softened considerably" following Beijing's investigations, he said. Without the probe, Chinese demand may have reached six million tonnes, doubling from 2010.

"If there's constructiveness in the signals (from the government), we could see another three million tonnes, perhaps a bit more, come back into China," he said.