By James Bruening, AgWeb Staff Writer
China’s corn consumption has been growing rapidly in the last five years, while its production has been falling behind the demand.
As many areas of China continue to battle with drought conditions, its corn crop is getting off to a fairly poor start this year. Jerry Gulke, Top Producer market analyst and president of the Gulke Group, sees an even larger fall in production to 148 million metric tons while consumption grows to 157 million. China produced 155 million metric tons of corn last year and consumed 156 million metric tons.
“They had problems, but they had not admitted to having these problems formally,” Gulke says. With announced plans to buy an additional 1.5 million tons of corn this year, it will have to come from somewhere.
Gulke’s comments came during an AgWeb webinar held last Thursday. (Click here to listen to the full webinar. Registration is required.)
“That’s 40 million bushels from somebody. And so far it’s been from us, and maybe they’ll buy some from Argentina if they get their differences figured out on the soy oil,” Gulke says.
With the U.S. corn crop looking to match, if not beat out last year’s yields, Gulke has projected carryover for 2010-11 at just above 2 billion bushels of corn.
“We need to get our world market back, and that’s why we should hope that this ‘world spending of money’ will help our agriculture in exports to someone else, especially Europe and, of course, Asia,” Gulke says.
Gulke explains that if China’s corn crop does end up in poor condition this year, it could be entering the market looking for 300 million to 400 million bushels of corn next year.
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