December 13, 2010

 

China's corn imports to be world's largest by 2015

 

 

In the next five years, China is seen to be the world's largest corn importer as pork and chicken output rises, according to Rabobank Group.

 

Imports may reach 25 million tonnes in 2015 from 1.3 million tonnes this year and be 60 million tonnes in 2020, said Wayne Gordon, a Sydney-based agricultural analyst at Rabobank.

 

Rising purchases by China, the world's most populous nation, may drive global corn prices higher. Demand for US corn for ethanol and constraints on production may also contribute to tighter global supplies, Gordon said.

 

"It is quite a bullish picture for feed grains going forward over the next decade," he said.

 

Corn for March delivery on the CBOT was little changed at US$5.7475 a bushel at 5:57 p.m. Melbourne time. Soy rose 0.3% to US$12.8475 a bushel.

 

According to USDA, Japan was the world's largest corn importer in 2009-2010 with purchases of 16 million tonnes. The US is the largest exporter of the grain, ahead of Argentina and Brazil.

 

China's increasing corn purchases may have the same effect on the market as its rising demand for Soy over the past decade, Gordon said. The country is the world's biggest buyer of Soy, taking more than half of global exports.

 

Soy in Chicago have gained 23% this year and reached a 27-month high in November on increased Chinese demand and concern that dry weather in the US and South America will reduce crop yields.

 

"Economic growth in China is creating more wealth and demand for meat, which means it will continue to need more grain and soybeans," Roy Huckabay, an executive vice president of the Linn Group in Chicago, said in October.

 

China may import as much as 15 million tonnes of corn in 2015 as the country enters a "new era" of buying from overseas, the US Grains Council said in July. The country's previous record imports totaled 4.29 million tonnes in 1994-1995, according to the USDA.

 

The imports may reach 10 million tonnes in 2015, according to a forecast on July 6 from Akio Shibata, chief representative for trading company Marubeni Corp.'s research institute. The company is Japan's biggest grain trader.