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China, Argentina Awash With Corn
China and Argentina, two of the world’s leading corn growers, could add to the low-price woes of U.S. growers. The Chinese government has approved the first large-scale corn exports in a decade and the Argentine Agriculture Ministry projected the largest corn plantings in history, which could mean a bumper crop in the months ahead.
Second to the U.S. as a corn grower, China had an unwieldy six-month supply of corn when this fall’s harvest began. Domestic corn prices could fall to a 10-year low, analogous to the situation facing U.S. growers but making the grain more attractive on the world market. China has curtailed corn supports so it can bring its stockpile under control and reportedly issued permits to two state-owned grain traders to export 2 million tonnes of corn.
That would be a small part of global corn trade, but the world is awash with grain. The International Grains Council forecasts record wheat, corn, and rice harvests this year, leading to record-large stocks for the second year in a row.
Argentine President Maurico Macri eliminated export taxes on corn and wheat when he took office last December. As a result, growers are devoting more land to corn and less to soybeans. The Buenos Aires grain exchange agreed with the Agriculture Ministry that corn plantings will set a record and estimated production would expand by 20%, to 36 million tonnes. Argentina exports two thirds, or more, of its corn crop.
China has been a net importer of corn for the past decade. The government sneered at the U.S. decision to challenge Chinese rice, wheat, and corn subsidies at the WTO as an attempt to muzzle its farmers.
This article was produced in collaboration with the Food & Environment Reporting Network, an independent, non-profit news organization producing investigative reporting on food, agriculture and environmental health.