China MOA Ag S&D Estimates June 2017

China's Ministry of Agriculture cut its estimate of 2017/18 corn output by 1.5 million metric tons in its June "China Agricultural Supply and Demand Estimates" (CASDE) report, based on drought conditions in parts of northeastern China. The yield was cut slightly due to hail that damaged new corn plants in some areas. The new estimate of 2017/18 corn output is about 8 mmt less than 2016/17, and nearly 13 mmt less than 2015/16. MOA now estimates that demand for corn will exceed supply by 1.7 mmt in 2017/18.

China corn supply and demand (Ministry of Ag, June 2017)
Item	Unit	2015/16	2016/17 June	2017/18 May	2017/18 June
Planted area	1000 ha	38,119	36,760	35,840	35,590
Harvested area	1000 ha	38,119	36,760	35,840	35,590
Yield	Kg/ha	5,893	5,973	5,948	5,947
Production	MMT	224.63	219.57	213.18	211.65
Imports	MMT	5.52	1	1	1
Consumption	MMT	194.09	210.72	214.07	214.07
--Food	MMT	7.65	7.82	7.89	7.89
--Feed	MMT	121.01	133.03	135.03	135.03
--Industrial use	MMT	54.17	58.25	59.75	59.75
--Seed	MMT	1.7	1.61	1.57	1.57
--Loss and other	MMT	9.56	10.01	9.83	9.83
Exports	MMT	1	0.3	0.3	0.3
Surplus	MMT	36.05	9.55	-0.19	-1.72
*2015/16 import volume shown in CASDE should be 3.2 mmt

The decline in corn area estimated by CASDE is 3.2 percent, slightly less than the 4 percent drop estimated by the National Bureau of Statistics planting intentions survey earlier this year. Another survey of over 5200 farmers in 22 provinces conducted in April found farmers planned to cut corn acreage by 10.9 percent.

The Ministry of Agriculture sent drought mitigation teams this week to western Liaoning, southeast Inner Mongolia, western Jilin, western Heilongjiang, northern Hebei and the Shandong peninsula. These areas have suffered from low rainfall, high temperatures, and windy conditions since April.

CASDE's June soybean S&D is unchanged from May. Some farmers in western Liaoning and easter Inner Mongolia were able to replant soybeans after rains came May 21-23, but young soybean plants were damaged by a late frost in parts of Inner Mongolia and Heilongjiang. Soybean area is setimated to be up 10.4% in 2017/18. Imports are expected to hit 89 mmt for 2016/17 and 93 mmt for 2017/18.

China soybean supply and demand (Ministry of Ag, June 2017)
Item	Unit	2015/16	2016/17 June	2017/18 May	2017/18 June
Planted area	1000 ha	6,590	7,156	7,899	7,899
Harvested area	1000 ha	6,590	7,150	7,899	7,899
Yield	Kg/ha	1762	1758	1785	1785
Production	MMT	11.61	12.57	14.1	14.1
Imports	MMT	83.23	89.45	93.16	93.16
Consumption	MMT	96.67	103.69	108.59	108.59
--Crushing	MMT	82.89	89.01	92.50	92.50
--Food	MMT	10.35	11.18	12.04	12.04
--Seed	MMT	0.54	0.6	0.6	0.6
Loss and other	MMT	2.89	2.9	3.45	3.45
Exports	MMT	0.12	0.14	0.22	0.22
Surplus	MMT	-1.95	-1.81	-1.55	-1.55

Cotton yield for 2017/18 was raised slightly, on good growing conditions. Imports were increased 100,000 mt to 1.1 mmt. Cotton stocks are expected to fall nearly 1.6 mmt in 2017/18.

China cotton supply and demand (Ministry of Ag, June 2017)
Item	Unit	2015/16	2016/17 June	2017/18 May	2017/18 June
Begin inventory	MMT	12.8	11.11	9.23	9.23
Planted area	1000 ha	3,267	3,100	3,200	3,200
Yield	Kg/ha	1,510	1,555	1,523	1,572
Production	MMT	4.93	4.82	4.88	5.03
Imports	MMT	0.90	1.00	1.10	1.10
Consumption	MMT	7.59	7.69	7.59	7.69
Exports	MMT	0.01	0.01	0.01	0.01
End Inventory	MMT	9.13	9.23	7.61	7.66

2016/17 China edible oil production is estimated at 26.57 mmt, up 270,000 mt from last month’s estimate. Cottonseed and sunflower oil production is expected to rise because of better cotton yields, and increased sunflower imports. Soybean oil production was reduced by 40,000 mt due to a downward adjustment in the proportion of domestic soybeans used for oil.

China edible oils supply and demand (Min Agriculture, June 2017)
Item	Unit	2015/16	2016/17 June	2017/18 May	2017/18 June
Production	MMT	25.29	26.57	26.85	27.07
--Soy oil	MMT	14.74	15.58	15.92	15.92
--Rapeseed oil	MMT	5.6	5.64	5.71	5.71
--Peanut oil	MMT	3	3.18	3.24	3.24
Imports	MMT	5.81	5.6	6.2	6.2
--Palm oil	MMT	3.39	3.25	3.75	3.75
--Rapeseed oil	MMT	0.77	0.75	0.85	0.85
--Soy oil	MMT	0.59	0.58	0.58	0.58
Consumption	MMT	31.29	31.46	31.63	31.63
--Urban	MMT	21.01	21.5	21.65	21.65
--Rural	MMT	10.28	9.96	9.98	9.98
Exports	MMT	0.13	0.13	0.13	0.13
Surplus	MMT	-0.32	0.58	1.3	1.52

The 2017/18 estimate of sugar area is 14.72 million hectares, up 9% from 2016/17. Sugar cane area is estimated up 7.9% from last year; sugar beet area is up 16.1%. This month’s estimate of 2016/17 sugar imports is 3 mmt, reduced 500,000 mt from last month’s estimate. The forecast for 2017/18 sugar imports is 3.2 mmt, adjusted down 300,000 mt from last month. The main reason is the implementation of safeguard measures starting from May 22. Duties will be assessed on imports of sugar outside of the tariff rate quota for 3 years.

China sugar supply and demand (Ministry of Ag, June 2017)
Item	Unit	2015/16	2016/17 June	2017/18 May	2017/18 June
Planted area	1000 ha	1423	1351	1472	1472
--sugar cane	1000 ha	1295	1183	1277	1277
--sugar beets	1000 ha	128	168	195	195
Yield
--sugar cane	MT/ha	60.3	60	60	60
--sugar beets	MT/ha	53.85	52.5	52.5	52.5
Sugar output	MMT	8.7	9.29	10.47	10.47
--sugar cane	MMT	7.85	8.24	9.23	9.23
--sugar beets	MMT	0.85	1.05	1.24	1.24
Imports	MMT	3.73	3	3.5	3.2
Consumption	MMT	15.2	15	15	15
Exports	MMT	-2.92	0.07	0.07	0.07
Surplus	MMT	-2.32	-2.78	-1.1	-1.4