Tuesday, July 1, 2008

Grain Bureau: No Corn Exports Until Fall

According to a corn industry report from yumi.com.cn, the head of China’s grain bureau said that the government will not issue corn export quotas until they see how the fall harvest goes in September. He said, “If this year’s harvest is not bad we could export some corn, but we have to make sure we first meet the needs of domestic feed mills and starch manufacturers.”

The report notes that imports and exports have a big influence on Chinese domestic grain prices. There is a big gap between China’s corn price and international price (China's price is lower) now so big imports are not going to happen. The report suggests that exporting corn could make domestic prices take off and strain the domestic supply-demand balance. The government has canceled the export tax rebate for corn since last December 20 and this year has added export taxes on corn and corn products of 5-10% and taken “reasonable control” of corn export quotas. At the same time the government strengthened its planning and guidance over the corn processing industry.

From the report:

China Corn exports, 2008 (Metric Tons)
Jan-Mar 80,000
April 26,235
May 0

The cumulative total for this year is down 97% from year-earlier

China Corn imports, 2008 (Metric Tons)
Jan-Mar 899
April 1,877
May 2,896

At last, China is a net importer of corn in May! ;) But less than 3,000 MT--that's a tiny amount. China typically exports 3 million MT a year. The cumulative total of imports for this year is roughly the same as last year.

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