Bloomberg News reported on Friday that “China set to pause buying large quantities of US corn after record purchases this year because the domestic harvest approach and local prices have fallen at the cheapest since the end of 2020.
âThe world’s largest importer has already purchased more than 10.5 million tonnes of American corn for the 2021-22 season, and over 23 million tonnes for the current season, show data from the US Department of Agriculture. Next year’s total imports are likely to be 20 million tonnes, according to the USDA Foreign Agricultural Service, while the official USDA forecast for this year is 26 million tons.
The Bloomberg article noted that “the fall in the domestic market and higher shipping costs means that there is less incentive buy abroad. A new round of U.S. purchases for state stocks appear unrealistic, said an industry source. Meanwhile, private companies have already exhausted their quota allocations, so further purchases are unlikely before the end of the year, said the source, who asked not to be identified to comment on the purchasing strategy. .
The Friday article added that âEven with a higher harvest, China expects corn supply shortfall in next marketing year of over 40 million tonnes, Who go must be met by imports of maize as well as sorghum and barleysaid Meng Jinhui, senior analyst at Shengda Futures in Beijing. A new round of purchases could will happen if there is any sign of improving bilateral relations between China and the United States, but not in the short term, Meng said.
Recall that a recent Reuters news article reported an increase in corn plantings in China, which could also potentially impact import demand.
While looking closer higher shipping costs, Reuters editors Naveen Thukral and Gavin Maguire, reported this week that,
Rising global crop shipping costs add to food inflation concerns that have already reached decade highs and are hitting cost-sensitive consumers in import-dependent markets.
âThe cost of bulk carriers that transport grains and oilseeds from production centers in the Americas and the Black Sea to major consumers is approximately doubled compared to last year due to rising fuel costs, tighter ship supplies and delays in e
“‘The cost of freight has become a real challenge as happens when we see huge increases in grain prices, âsaid Phin Ziebell, agri-food economist at the National Australia Bank in Melbourne. “
This is in addition to soaring prices for these crops, which has helped fuel global food prices to rise to their highest level in a decade. pic.twitter.com/MEK1LdUJxF
– Gavin Maguire (@GavinJMaguire) July 9, 2021
The Reuters article stated that “the double whammy of rising crop and freight prices is nab buyers in Asia, the region that consumes the most crops and is home to China which represents more than half of world soybean purchases. Japan is one of the largest buyers of corn in the world.
And in news regarding domestic agricultural issues in China, Bloomberg News reported this week that âChina plans to expand agricultural insurance policies to protect more farmers and boost agricultural production including rice, wheat and But with the aim of improving the security of the food supply.
The Bloomberg article stated that, âChina, the largest consumer of agricultural products, strives to self-sufficiency in essential grains of rice and wheat, and seeks to restrict imports of corn as much as possible. Nonetheless, overseas wheat purchases could increase this year to reach their highest level since the mid-1990s and corn imports more than tripled to a record high due to an expanding pig herd and harvest issues.
The Bloomberg article added that “The government is committed to supporting producers’ incomes and improving technology increase productivity in a country where agricultural land is limited and growing wealth is stimulate demand. President Xi Jinping said the Chinese people’s bowl of rice, in any situation, should be held firmly in our own hands, Zou Noted at a press conference on Tuesday.