China boosted corn prices last spring when it tested the U.S. waters with a small, 115,000-million-ton purchase and again when it bought about 300,000 tons a few weeks later. With its imports now at 1.2 mmt, China has purchased the most corn since the 1995 crop’s 1.46 mmt. The question becomes "How much is possible?" The most bought in the past was just under 4 mmt in 1994/95.
Chinese corn production is being outstripped by its demand for meat, milk and eggs. In addition, although still less than half its feed needs, China’s industrial uses are growing rapidly, according to Fred Gale, USDA economist. "The share of China’s corn used for food, seed and industrial uses is among the world’s highest, likely second only to the U.S.," he reports.
"We have gotten to the turning point. We've come to the conclusion that a new era of China importing corn is here," Hanver Li, chairman of the market research firm Shanghai JC Intelligence Co. Ltd., told the U.S. Grains Council recently. Li estimates that China's corn imports would climb from 1.7 million tons this year to as much as 15 million tons by 2015.