China May Become World’s Top Corn Buyer, Grains Council Says

China may become the world’s largest importer of corn “in the near future,” said Rebecca Bratter, the director of trade development for the U.S. Grains Council.

Chinese demand is rising as the population increases, and the growing middle class buys more meat produced from corn- consuming livestock, Bratter said today at the U.S. Department of Agriculture’s annual outlook conference in Arlington, Virginia. China became a net importer of corn last year for the first time in 14 years.

“There is no doubt that China needs to buy a lot of corn,” Bratter said. “It is not unreasonable to expect that in the next five years, China may be importing 15 million metric tons of corn.”

The USDA expects China to import 1 million metric tons of corn this year, down from 1.3 percent last year. The country has a tariff-rate quota of 7.4 million tons, which “may be completely filled in the next year,” Bratter said. Last year’s imports were “just the tipping point,” Bratter said. “This is going to be part of a trend that’s going to continue.”

China’s economy is forecast to grow by 9.5 percent this year, according to the median analyst estimate in a Bloomberg survey. The country’s middle class may increase to 700 million people in the next five years, with 75 percent living in urban areas, Bratter said. In the next decade, annual per-capita incomes may reach as high as $40,000, compared with about $5,000 today, she said.

As livestock herds expand, demand also is increasing for dried distillers grains with solubles, an ethanol byproduct known as DDGS, Bratter said. China’s imports of U.S. DDGS rose from zero to 2.4 million tons over the past three years, she said. Ethanol is a fuel made from corn.

Japan is now the world’s top buyer of corn, according to the USDA. China does not rank in the top 10 importers of the grain.

(Source: http://www.bloomberg.com/news/2011-02-24/china-corn-imports-may-be-world-s-biggest-as-meat-demand-grows-group-says.html)