March 13, 2012

Chinese agencies vary 2011 corn yield record

Key agencies of China vary on the volume of the country's 2011 corn yield, Standard Chartered said in a research note Monday (Mar 12).

The Ministry of Agriculture said China harvested a record 192 million tonnes last year, up 8.5% from the previous year.

However, the China National Grain and Oils Information Center, a key state grain industry think tank, estimated the harvest at 185 million tonnes.

Shanghai JC Intelligence, a well-regarded Chinese consultancy, put the figure even lower at 168 million tonnes, Standard Chartered analysts Stephen Green and Serene Lim said.

The size of the harvest puts "a big question" over the current level of Chinese corn reserves.

While the USDA has estimated the size of the reserves at 58 million tonnes, Standard Chartered suggested that "some in the market" were projecting a considerably lower figure, "given the likelihood that harvests each year are being over-reported."

Low official reserves and feed demand growth, limits on corn acreage and the state's unwillingness to allow commercial genetically modified grains suggest China may look to boost imports.

The USDA estimates China's corn imports will reach four million tonnes this crop year and the next, the analysts said.