Corn exports, including the actual shipments so far this year, are up 80% compared to last year.
“Exports to China alone account for almost 70 percent of the increase, so that’s an interesting move and a big change there,” says Dr. Jim Mintert, Ag Econ Professor and Director of the Purdue Center for Commercial Agriculture. “If you look at the prior years, historically, China has essentially purchased zero corn from the U.S. in prior years, so this is a big switch. And it really makes the export forecasting business somewhat challenging.”
Mintert says China is in need of more corn due to the rebuilding of its pork industry.
“The driver here is China’s attempt to rebuild their meat supplies rapidly, especially pork. And in the process of doing that in response to the African Swine Fever problem they’ve had in China for the last several years, they’ve really changed how they produce hogs. So, they’re switching over to an industrial-style pork production model, and that results in a big change in their diets, so they’re switching over to a diet that’s focusing more heavily on corn and soybean meal. That’s really responsible for this big shift in their import requirements.”
How much corn could China buy?
“We have China’s corn imports from all sources going back to the year 2009, and on a worldwide basis, China has not historically been a big corn importer. The USDA’s Foreign Ag Service is currently projecting their total imports will approach 900 million bushels. However, the trade is somewhat disappointed. I know as you look at some of the trade expectations say that number could rise closer to a billion bushels.”
Mintert made these comments during a February Corn and Soybean Outlook Update webinar last week.
Source: NAFB News Service