CASDE Dec 2016

The China Agricultural Supply and Demand Estimates (CASDE) for December have only a few modest tweaks to the estimates compared with November.

Most changes were made in the corn estimates. 2016/17 corn production was raised 1.05 million metric tons (mmt), to 214.65 mmt. Corn consumption was raised 450,000 metric tons, to 210.72 mmt. The carry-out was increased by 600,000 mt. CASDE forecasts China's 2016/17 corn inventory to expand by 4.43 mmt. Imports are kept at a minimum level of 1 mmt for 2016/17.

CASDE revised upward their view of the 2016/17 corn crop. They raised harvested area to 36.016 million hectares, essentially equal to their planted area of 36.026 mil. ha. The yield was also revised upward to 5960 kg/ha from last month's 5935 kg/ha estimate. Compared with last year, CASDE estimates that 2016/17 corn area and yield are both down from 2015/16. The estimate of China's corn output for 2016/17 is down 4.4 percent from 2015/16, yet the inventory is still expected to increase this year.

CASDE increased their estimate of corn consumption for food (100,000 mt), feed (50,000 mt) and industrial use (300,000) mt. CASDE attributed the increase in industrial use to lower corn prices and better profits for starch and alcohol manufacturers.

China corn supply and demand (Ministry of Ag, December 2016)
Item	Unit	2015/16	2016/17 Nov.	2016/17 Dec.
Planted area	1000 ha	38,117	36,026	36,026
Harvested area	1000 ha	38,117	35,990	36,016
Yield	Kg/ha	5,892	5,935	5,960
Production	MMT	224.58	213.6	214.65
Imports	MMT	3.2	1.0	1.0
Consumption	MMT	194.05	210.27	210.72
--Food	MMT	7.65	7.72	7.82
--Feed	MMT	121.01	133.48	133.53
--Industrial use	MMT	54.17	57.45	57.75
--Seed	MMT	1.66	1.61	1.61
Loss and other	MMT	9.56	10.01	10.01
Exports	MMT	0.01	0.5	0.5
Surplus	MMT	33.72	3.83	4.43

The CASDE write-up on soybeans emphasizes the effect of a September regulation that raised trucking costs and reduced shipments of domestic soybeans from the northeast (the report's discussion of corn does not mention this, although other sources say transportation costs and bottlenecks are slowing domestic shipments of corn). Processors have raised their soybean purchase prices, CASDE says. China's National Grain Reserve Corporation (Sinograin) has also raised its procurement price to replenish reserves, CASDE says, causing other buyers to raise prices. CASDE raised its forecasted interval for domestic soybeans by 100 yuan to 4450-4650 yuan/metric ton. The C&F price of imported soybeans is 3250-3450 yuan/mt. CASDE has not changed its 2016/17 estimate of imports--still 85.3 mmt.

China soybean supply and demand (Ministry of Ag, December 2016)
Item	Unit	2015/16	2016/17 Nov.	2016/17 Dec
Planted area	1000 ha	6,590	7,156	7,156
Harvested area	1000 ha	6,590	7,150	7,150
Yield	Kg/ha	1,762	1,748	1,748
Production	MMT	11.6	12.5	12.5
Imports	MMT	83.2	85.3	85.3
Consumption	MMT	96.7	99.7	99.7
--Crushing	MMT	82.9	85.5	85.5
--Food	MMT	10.4	11.2	11.2
--Seed	MMT	0.5	0.6	0.6
Loss and other	MMT	2.9	2.5	2.5
Exports	MMT	0.1	0.2	0.2
Surplus	MMT	-1.9	-2.1	-2.1

Only minor changes were made in CASDE's cotton balance sheet, including small reductions in yield and imports for 2016/17. Cotton imports were shaved from 960,000 mt to 900,000 mt. China's cotton imports are down as authorities issue only the bare minimum of tariff rate quota for the second year in a row. China continues to slowly unwind its cotton inventory. CASDE expects 2.05 mmt of cotton inventories to be injected into the market during 2016/17, but the carry-out will still be 9.18 mmt, still a very high stocks-use ratio of 122 percent.

China cotton supply and demand (Ministry of Ag, December 2016)
Item	Unit	2015/16	2016/17 Nov.	2016/17 Dec
Begin inventory	MMT	12.8	11.11	11.11
Planted area	1000 ha	3,267	3,100	3,100
Yield	Kg/ha	1,510	1,526	1,523
Production	MMT	4.93	4.73	4.72
Imports	MMT	0.96	0.97	0.90
Consumption	MMT	7.54	7.52	7.54
Exports	MMT	0.02	0.02	0.01
End Inventory	MMT	11.13	9.27	9.18

Only minor changes were made in the edible oils balance sheets and no changes were made in the sugar S&D.

China edible oils supply and demand (Min Agriculture, December 2016)
Item	Unit	2015/16	2016/17 Nov.	2016/17 Dec
Production	MMT	25.3	25.81	25.79
--Soy oil	MMT	14.74	15.17	15.16
--Rapeseed oil	MMT	5.6	5.55	5.55
--Peanut oil	MMT	3.01	3.18	3.18
Imports	MMT	5.81	5.50	5.55
--Palm oil	MMT	3.39	3.20	3.20
--Rapeseed oil	MMT	0.77	0.75	0.80
--Soy oil	MMT	0.59	0.58	0.58
Consumption	MMT	31.17	31.38	31.41
--Urban	MMT	20.41	20.55	20.8
--Rural	MMT	10.76	10.83	10.61
Exports	MMT	0.11	0.13	0.13
Surplus	MMT	-0.17	-0.19	-0.20

China sugar supply and demand (Ministry of Ag, December 2016)
Item	Unit	2015/16	2016/17
Planted area	1000 ha	1423	1433
--sugar cane	1000 ha	1295	1270
--sugar beets	1000 ha	128	163
Yield
--sugar cane	MT/ha	60.3	60
--sugar beets	MT/ha	53.85	52.5
Sugar output	MMT	8.7	9.9
--sugar cane	MMT	7.85	8.85
--sugar beets	MMT	0.85	1.05
Imports	MMT	3.73	3.5
Consumption	MMT	15.2	15
Exports	MMT	0.15	0.07
Surplus	MMT	-2.92	-1.67

This CASDE report was issued December 5, a week earlier than the scheduled December 12 release. The report updated the list of scheduled release dates for 2017, with the next report due January 12, 2017.