No sharp rise in China corn imports
China's imports of corn are unlikely to rise sharply over the next year or two, as the country has maintained ample domestic supplies, Nie Zhenbang, the head of China's State Grain Administration, said Tuesday.
The country will be able to maintain its self-sufficiency ratio for feed grains--mostly corn--above 95%, even though corn consumption for non-feed and non-food products is rising quickly, Nie told reporters on the sidelines of the Chinese People's Political Consultative Conference, the country's top political advising body.
His comments came amid market speculation that China's corn imports will continue rising sharply after the country became a net corn importer in 2010 and saw corn imports increase 11.5% to 1.7 million tons in 2011.
Meanwhile, China's National Development and Reform Commission said Monday in a report to the National People's Congress that the country will expand imports of agricultural products that are in tight supply, signalling a potentially significant expansion of corn imports in the medium term.
"Corn is not the farm product in supply deficit," Nie told reporters, describing its availability as "sufficient" due to a record domestic harvest last year.
Nie said that although supply and demand are balanced and ample corn reserves ensure China is able to meet domestic demand, domestic corn prices are unlikely to fall, as the government's purchases of corn from farmers support prices.
INTL FCStone Inc. (INTL) said last month that China's corn imports could reach 13 million tons by 2012-13 from 4 million tons in 2011-12 after the U.S. Grains Council said last year that China's import requirement in 2011-12 will total between 5 million and 10 million tons.
"China's feed imports this year will fall slightly on record domestic corn harvest," Ning Gaoning, chairman of state-owned grain trader Cofco Group, said Tuesday that China's feed grain imports will fall slightly this year thanks to the record corn harvest.
Corn output in China rose 8.2% in 2011 to a record 191.75 million metric tons, according to government data.
China will only import corn when there's a price advantage to doing so, Ning said.
Part of the reason corn supply and demand is balanced in China is the government has practically stopped approving new corn processors, while imports of sugar have increased due to favorable international prices for the sweetener, reducing the need to process corn into sugars, he said.
The State Grain Administration's Nie also said the government supports feed mills that use wheat as a corn substitute, as there is a surplus of wheat. China's wheat output this year is unlikely to fall because the weather has been favorable, he said.
-Zhoudong Shangguan contributed to this article; Dow Jones Newswires; (8610) 8400 7715; firstname.lastname@example.org
(END) Dow Jones Newswires
March 06, 2012 00:18 ET (05:18 GMT)