Saturday, November 1, 2008

China exports starch

China's industrial use of corn has been booming over the last few years. Chinese analysts estimate that starch, alcohol, and related industries use about 40 million metric tons of corn annually compared with about 92 mmt used for animal feed. The starch industry has a history of booms and busts. The industry apparently is overbuilt and Chinese industry reports indicate some starch products are in surplus and a large share of some products are being exported.

According China National Grain and Oils Oct. 30 Corn report: China’s corn starch exports for Jan-Sept 2008 totaled 397,000 mt, up 74% from same period last year. From 1992-2006, exports were never more than 200,000 mt.

The total for calendar year 2007 was 342,000 mt, which will be surpassed this year for a new record. The main reason is that domestic starch production is in a serious surplus situation; the excess is exported. This year China’s corn starch exports mainly go to SE Asia and other Asian countries, including 27.2% to Indonesia, 16.8% to S. Korea, 8.4% to Philippines, 7.5% to Taiwan, 4.5% to Malaysia.

Exports of distillers' dried grains with solubles (DDGS, the by-product of alcohol production, used for feed) in Sept totaled 17,800 mt, relatively low, but the calendar-year total through September looks to be about 180,000 mt. Alcohol production declined in July-Sept, cutting back on the supply of DDGS co-product.

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