September 22, 2011
China's corn imports in August reached the highest monthly volume in 10 months, rising 42% from the previous month to 244,502 tonnes, the General Administration of Customs said Wednesday (Sep 21).
China's demand for corn imports is expected to accelerate due to the country's sharply rising feed demand, and as global prices come off recent highs.
In the marketing year ended August 31, China purchased 1.3 million tonnes of corn, compared with 715,678 tonnes the previous year.
"China's corn supply is tight, and the country may be starting an import cycle that could take annual import volumes as high as nine million or even 10 million tonnes," analysts said.
Demand pressure on corn inventories has pushed up domestic spot prices in Shandong province, a major processing centre, about 33% since the start of the calendar year.
Beijing's State Grain Administration said Tuesday it will release 3.7 million tonnes of corn from central government reserves ahead of the harvest to assuage market demand.
As global prices ebbed this month following an improved crop outlook, analysts expected Chinese state buyers to prime for dip purchases.
"China's government is greatly interested in South American corn, particularly from Argentina, and we may see an import bump in the fourth quarter or the first quarter next year," experts said.
If so, the trade would begin to shift away from the US, which has traditionally been China's main corn source. The US supplied 99.9% of China's corn imports last month.
The bulk of recent Chinese purchases for official stockpiles will not show up in official customs data until after October, since they were new-crop corn, analysts said.
August corn imports were down 43.4% from August of last year due to the unusually high base of that month.