A move by China to decrease its reliance on offshore imports of beef and increase its own growing number of local cattle is behind a push in purchasing corn.
Forecasts from the US Department of Agriculture (USDA) show that China, which is already the world’s leading importer of soyabeans, will overtake Japan in 2020 at the top of the corn purchasing
leaderboard, the Financial Times reported on its website.
In that report it highlighted that the USDA projects China to increase its pork, poultry, and beef output to reach 90 million tonnes by 2023-24, a rise of about 30 per cent from 2012.
China’s quest to feed an increasing number of animals by importing more corn will see the world’s most populous country leapfrog South Korea as the third top corn importer in 2017 and take Mexico’s No. 2 spot in 2019.
The sharp rise in meat demand underlines the country’s need to secure grain imports and also explains recent transactions by Cofco – or China National Cereals, Oil and Foodstuffs Corp – where the state-owned group is paying between $US1 billion and $US2 billion for a stake in a sugar, soyabean and wheat joint venture with Noble Group, and separately purchased a controlling stake in Dutch agricultural trading house Nidera valued at about $US1.3 billion, the Financial Times reported.
China’s rising demand for corn is likely to support prices going forward. The record US harvest in 2013-14 depressed the market and some analysts expect prices to remain in the doldrums through 2015-16 before they recover.
China’s corn imports, which are currently 5 million tonnes, are projected to rise to about 16 million tonnes by the end of the decade and 22 million tonnes by 2023-24, according to the USDA.
|China (Photo credit: Wikipedia)|
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