NANCHANG, China (Reuters) — China, the world’s second-largest corn consumer, is likely to rely more on imports and lower its self-sufficiency ratio for the grain to 90 percent by 2020, an executive at the country’s top corn trader said on Thursday.
Based on current import levels, China’s self-sufficiency ratio for corn could hit 93 percent by 2018 and 90 percent by 2020, Fan Zhenyu, deputy general manager of corn division at the state-owned COFCO Co. Ltd. told a corn conference.
China’s corn production in 2012 was 208 million tonnes and its imports amounted to 5.2 million tonnes, giving it a self-sufficiency rate of almost 98 percent. The nation has a long-standing policy of 95 percent self-sufficiency in all grains but has tweaked it when necessary, as in the case of soybeans.
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Cutting the self-sufficiency rate to 90 percent would bring China’s annual overseas purchases above 20 million tonnes, making it the world’s top corn importer. An increase in imports will also provide support for global prices, with benchmark Chicago corn tumbling about a third this year.
Beijing supports local farmers by stockpiling corn, which has driven up domestic prices and made imports more attractive. But it limits corn imports by issuing quotas.
The government might now be reappraising its policies, Fan told Reuters.
“There’s some indication,” he said. “I believe the market could have smelled the flavour of a change in policy but so far we haven’t seen anything in words.”
The new government may decide to rely more on overseas markets to ensure China’s food security, with local land and natural resources increasingly scarce, he told the conference.
At the beginning of the month, China’s agriculture minister, Han Changfu, appeared to suggest that the country would accept more corn imports in the coming years.
A government researcher also said that imports could reach 20-30 million tonnes within a few years.
However, in a speech later in the month, Han reaffirmed China’s commitment to a long-standing policy of remaining 95 percent self-sufficient in the grain.
Because of the import restrictions, Chinese feed mills have shifted to substitute feed products like sorghum and distillers’ dried grains.
China’s sorghum imports would reach 1.5 million tonnes in 2013-14 while imports of DDGS would be about three million tonnes, Fan estimated.
