February 14, 2012

China's corn imports may quadruple in next decade

China is likely to increase its corn imports by fourfold in the next 10 years, mainly to fatten more livestock at home, the USDA projected on Monday (Feb 13).

In a 10-year outlook, USDA said Chinese soy imports would rise by 59% to 90 million tonnes, by 2021. A quarter of the US soy crop goes to China, the number one customer for US farm exports.

USDA released its projections on the same day Chinese Vice President Xi Jinping arrived for a US tour, including an agriculture symposium in Iowa, the number one US corn and soy-growing state.

Agriculture Secretary Tom Vilsack and Chinese Agriculture Minister Han Changfu are to meet briefly before the symposium on Thursday. Vilsack told reporters the US wants China to remove barriers to US beef. There will be an opportunity to update work on a two-way dispute over poultry trade, he said.

Strong economic growth, forecast to average 8% a year, will allow China to expand its agricultural purchases, said USDA. China buys 60% of soy and nearly half of the cotton on the world market at present. It imports small amounts of corn; four million tonnes are forecast this year.

"China's net imports of corn are projected to reach 18 million tonnes by the end of the projection period as imports grow steadily while exports remain small," said USDA in discussing farm trade prospects to 2021. "China's strengthening domestic demand for corn is driven by its expanding livestock and industrial sectors."

With a choice between importing more corn or soy, China will try to grow more corn, said USDA. China would account for 80% of the growth in soy trade through 2021 and 45% of larger corn trade, it said.