Posted on 04/14/2012 2:12:15 PM PDT by DeaconBenjamin
China's grain imports hit a record high in March, as the world's most populous country increasingly turns to overseas markets to meet its agricultural needs.
Customs data from Beijing revealed that grain imports reached 1.64m tonnes in March, up sixfold from a year earlier and up 50% from the previous month.
China has to feed a fifth of the world's population with only 8% of the world's arable land, and does not grow genetically modified grains. As rising incomes and more meat-heavy diets boost grain demand, China's reliance on imports has slowly increased.
Big corn purchases likely contributed to the jump in March grain imports, said traders. The grain category includes corn, wheat, rice and barley. Specific data for each will be released toward the end of this month.
China accounts for about 20% of the world's corn consumption and only 4% of global corn trade, but its sudden increase in corn buying has greatly tightened the global market. China's corn imports in January and February this year totaled 1.26m tonnes, four hundred times more than the same period last year.
China's domestic corn prices are among the highest in the world, and during January and February commercial firms were taking advantage of the arbitrage between Chinese and US corn prices to import corn at a profit. However the arbitrage window has now closed, and traders say that could damp corn imports in coming months.
The surge in grain imports was part of robust overseas purchase of commodities in March, with imports of crude oil hitting their third-highest levels ever at 5.56m barrels per day, up 8.6% from the previous year.
"These very comforting numbers, China is not slowing too rapidly," said Ian Roper, analyst at CLSA in Shanghai, referring to overall commodities imports in March.
Imports of iron ore, a key steelmaking ingredient were up 5.7% from the previous year at 62.8m tonnes.
Meanwhile copper, a bellwether of industrial activity, stayed near record highs with imports of 462,182 tonnes in March, up 50.5% from the previous year.
However it was grain that recorded the single biggest year-on-year jump in percentage terms of any commodity with a 500% increase, according to the customs data released Tuesday.
Analyst Ma Wenfeng at Beijing Orient Agribusiness said he expects China's grain imports to grow. He forecasts corn imports will hit 7m tonnes this calendar year, and wheat between 1.5m to 2m tonnes.
"The key thing is the price," said Mr Ma. "Right now China's corn prices are incredibly high. . . if [state owned commodity trading house] Cofco can make money then it will import."
Others pointed out that mold and mildew had damaged some stored corn last year, contributing to tight domestic corn market. "Production [of corn] has increased significantly in China, but safe and secure storage have not grown in conjunction," said Rabobank analyst Daron Hoffman.
Wheat imports have also soared, thanks in part to demand for high-protein wheats used in specialty breads. China's wheat imports in January and February were 580,000 tonnes, more than three times higher than the same period last year.
The March grain imports are the highest since Chinese customs started reporting aggregate grain imports in 2006.
Good grief.
What would we do with unprocessed surplus feed corn here in the USA?
Oh I know, lets subsidize it, require by law to include it in ethanol impaired gasoline blends, thereby destroying small engines nationwide. Or maybe the feds should just use tax money to pay midwest farmers to not grow feed corn?
How about we find a market begging to buy feed corn, and sell it? What part of the federal government is broke do you not understand. Who’s living in the 50’s? You apparently want to continue the new deal great depression style farm subsidy racket. I’d like to see free market approaches to current problems.
Are you retarded? You are obviously ignorant, from the simple fact you call it ‘feed corn’. That’s the mentality that got us where we are. Corn has protein, oil, neutraceuticals, pharmaceuticals, and the sugars can be fermented into anything you wish, including exotic and high-value chemical. The tech is there and coming on line but everybody is still back channeling Eisenhower and Sputnik and doesn’t want to think about the possibilities and take the risk.
Remember that he led the Screen Actors Guild through the HUAC hearings, and he was able to finger a lot of communists in Hollywood (and they were, but only one ever admitted to it, though the evidence against the others was damning.)
As such, he had a deep understanding of the psychology of fanatical communists. (Oddly enough, an investigative technique used to determine if someone was a genuine communist was to tell them a joke. Fanatics try to fit everything they experience into their tight little reality, so there is no place for humor. Thus they cannot genuinely laugh in a spontaneous manner.)
I really have no clue who gave him his great insights about American agriculture, which he probably got in his youth in Illinois, or during his time in Iowa. America learned a lot about agriculture as a nation during the Dust Bowl and Great Depression. The Federal Surplus Relief Corporation left a lasting impression on many farmers, and not a good one.
Chi-coms, Saudi Arabia, Iran etc all need fuud stuffs to feed their populations and STILL we refuse to use our food as a weapon???
WTF???
Meanwhile we continue to let the Saudi’s bend us over for OIL?
Starve the bastards.
Look, give me a report on “Fungible Commodities” and how you trade them in a world market.
Otherwise, stop personally attacking me before I report you to the moderator.
Either Corn, whether it’s feed corn or sweet corn, is a tradable commodity worldwide, or it’s a overgrown federally subsidized welfare crop. A corn farmer may as well sell his farm and go on foodstamps because the difference is semantics.
If there is a market for your corn derivatives, sell them. If there is no market without federal subsidies, go on food stamps. There is no difference.
In fact, I propose every dime of corn subsidy go to Solyndra to subsidize solar panels that nobody wants to buy. (OK, not really) There is no difference pissing away money on worthless money losing companies like Solyndra, than pissing away money subsidizing stupid nonviable corn BS.
I’m sick of the “I’m a conservative except for when it’s my federal subsidy being threatened” types. There is no more money!
China accounts for about 20% of the world's corn consumption and only 4% of global corn trade...
This sounds like sonething that 0bama would say about the USA and oil production/consumption.
LOL, maybe that Phil Hartman portrayal of Reagan on SNL was more true-to-life than people thought
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