Stagnant domestic production fueling China’s record corn imports
An ag economist says China has not increased domestic corn acres in seven years, which is a primary driver for the country’s ramp up in corn imports.
David Widmar with Ag Economic Insights tells Brownfield the industry doesn’t fully understand why China is buying so much corn today, with guesses ranging from poor quality stocks to bad production.
“We need to untangle this a little bit and say, ok is there a supply shock going on here or is it a bit of a demand story? When we look at the data, acreage production seems to say they aren’t able to add more supply, so this is a demand growth story.”
Widmar says since 2015, China’s corn consumption has outweighed production leading to the import of 29 million metric tons of corn in 2020 and 23 million metric tons in 2021.
“For them to bring more corn into production, they are going to have to pull that away from another crop. China is reaching a point they potentially need to reevaluate how much they are going to rely on exports.”
He says if Chinese corn production remains flat, they will continue to rely on global corn exports moving forward. And Widmar says the question remains, “How active of a trade partner will the US be in fulfilling both China’s soybean needs today and their future corn needs as well?”