China

Market Snapshot 2018 - China - Commodity Table

Supply/Demand Basics

  • World’s 2nd largest corn producer and consumer.
  • World’s largest swine, aquaculture, and egg producer, 2nd largest poultry meat and corn ethanol producer and growing dairy and beef producer.
  • World’s largest sorghum and DDGS importer in recent years, but imports are declining due to protectionist policies.

Country Overview

  • Population / growth: 4 billion / 0.8%
  • Urban % / growth: 9% / 2.3%
  • GDP / growth: $23.1 trillion / 6.8%
  • GDP per capita: $16,600
  • Slowing economic growth not expected to have large effect on consumption growth due to restructuring toward more consumption and less savings and focus on
  • Urban residents consume more animal protein than their rural counterparts, and urbanization is expected to grow from 55 – 70 percent in eight years.
  • China’s per capita animal protein consumption is still well below more developed Asian economies and there is substantial room for animal protein demand to grow.

Trade and Market Share Issues

  • U.S. market share in corn import fell from over 90 percent to less than 10 percent after rejection of unapproved GMO traits in late 2013. However, all U.S. traits are now approved and U.S. market share recovering.
  • China was the largest importer of U.S. DDGS until last year when DDGS imports fell to a fraction of their former level under the imposition of high, anti-dumping duties.
  • China remains the largest sorghum importer and a large potential importer of U.S. corn, barley, DDGS and ethanol.

Policy Issues

  • China’s has built up large, government-held corn stocks. China is currently using protectionist policy to help draw down these stocks, including large anti-dumping duties on U.S. DDGS. Policies to reduce feed grain imports are expected to continue until large corn stocks are drawn down, which could take two-four years.
  • China’s 13th five-year plan is committed to greater openness to world markets for feed grain, but opposition to this policy is strong and progress in implementing it has been, unsteady. U.S.-China trade relationship also impacting U.S. agricultural exports.
  • China’s Ministry of Agriculture officially embraces biotechnology, but progress towards greater acceptance is slow.
  • In 2017 China announced a major commitment to using E10 nationwide by 2020, although how this will be accomplished and the role that imports will play is still uncertain.

Market Snapshot 2018 - China - Chart