Along with wheat and rice, corn is one of the three main crops in China, so the government will take measures to ensure self-sufficiency as part of an inclusive food security policy. .
Annual maize production was the largest of all crops at 257 million tons last year.
The corn industry is also an important part of the national economy, contributing 7.8% of China's gross domestic product in 2018, according to Tong Yi, chief engineer at the Grain, Oil and Food Group. Chinese nation – the largest state-owned food processor in China.
However, the latest data from China's Ministry of Agriculture shows that as of the end of August, the number of live pigs of Asian countries has decreased by 38.7% from a year earlier.
The number of sows has also decreased by 37.4%, suggesting that piglets will be born less and the number of pigs will continue to shrink in the future, and as a result, the demand for corn has been and will sharply decline.
Feng Jilong, general manager of Dalian Northern Internationald Grain Logistics, said the impact of African swine cholera on the corn market has been shown to be much stronger than previously estimated.
Earlier this year, it was estimated that the number of pigs would be reduced by about 20%, or by half compared to the actual 40% reduction so far, Feng said.
The situation is more serious than the actual data suggest
Zhang Qirong, who is in charge of buying corn at Twins Group, a Chinese animal feed manufacturer, said the company's research showed that China could lose 50% or even 60% of pigs due to the epidemic. African pig cholera (ASF).
“The situation could be much more serious than the official data suggests, according to our data,” Zhang told the China Corn Industry Conference in Dalian City, northern China. , last week.
Lan Renxing, deputy director of feed supply chain management at New Hope Liuhe, another major feed manufacturer, said the ASF epidemic could reduce demand for pig feed this year by 25%, according to That would eliminate at least 23 million tons of maize consumption, equivalent to nearly 10% of the domestic production.
The corn market is well supported in China because the production cost per ton is more than double that of other major producing countries, such as the US where the standard corn price is around US $ 155 per ton, or a little lower. 50% more than in China, according to South China Morning Post.
China protects its domestic market with an annual import quota system of 7.2 million tons in 2019 with 1% import tax. Goods imported outside quota will be subject to 65% tax rate.
“If the US-China trade talks go well, Beijing will step up agricultural imports in general, meaning that the price of agricultural products (in China) will gradually decrease to match the international market,” according to Mr. Gu Zhong, General Manager of Dalian Zhonggu Trading, a agribusiness company in Dalian.
“Increasing safeguards will be a trend,” Gu said, with feed and fuel expected to lose state protection despite certain control measures.
The central government's annual policy document focusing on agriculture released earlier this year states that wheat and rice production must be protected, while maize may only need to be stabilized.
In March, Chinese importers ordered the largest amount of corn from the United States for at least five and a half years despite an oversupply at home, according to the US Department of Agriculture.
In addition, a national campaign to increase domestic soybean production in the context of a trade war has caused more problems for the Chinese corn industry, with farmers in Heilongjiang (China) switching. planting soybeans this year, according to Feng from Dalian Northern Internationald Grain Logistics.
According to Economy & Consumer
