August 15, 2006

China's 2006 corn demand seen to rise 3.5 percent on-year

China's demand for corn is expected to increase 3.5 percent to 141.5 million tonnes in 2006, an analyst with the National Grain & Oils Information Centre (CNGOIC) said over the weekend.

"China will produce around 142 million tonnes of corn this year, up from 139.37 million tonnes last year, with its demand for corn expected to be 141.5 million tonnes, compared with 136.7 million tonnes in 2005," Li Xigui, an analyst at CNGOIC said.

"Corn consumption hit a record height this year, driven by strong industry demand," Li said.

"Total demand from corn processing enterprises will reach 30 million tonnes this year, up from 26.3 million tonnes in 2005," he added.

"In 2006, corn used to produce animal feed will reach 92 million tonnes, compared with 89 million tonnes last year," Li said.

Corn is mainly used to make feed in China.

Corn acreage has been expanded to 26.9 million hectares in 2006, up 2.1 percent on year, according to Li.

Corn prices were expected to rise due to strong demand in the second half of this year, Li added.