China stockpiles corn in favour of imports

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Publish time: 29th January, 2015      Source: www.cnchemicals.com
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January 29, 2015
   

   

China stockpiles corn in favour of imports

   

   

   

China corn stockpiles are expected to rise by a record volume this year, at the expense of the issuance of new import quotas.

   

   

The government''s efforts to boost demand with a tax rebate for corn starch exports aim to stimulate sales, industry officials told Reuters.

   

   

China''spolicy of subsidising corn prices has supported production and stockpiling, pushing it to increase export tax rebates for corn starch and other corn-based products such as monosodium glutamate to 13% in an attempt to make exports competitive.

   

   

However, according to Fan Chunyan, an official at the China Starch Industry Association, "It will be of little help as the industry is unable to export much and has been making losses over the past few years."

   

   

Separately, China''s corn consumption fell for a second year in 2013/14, also hit by buyers preferring cheaper substitutes, such as distillers'' dried grains (DDGs).

   

   

Beijing may however still be forced to raise corn reserves to a record 120 million tonnes in the 2014/15 stockpiling year, equivalent to nearly eight months of China''s consumption, CNGOIC estimated.

   

   

Sinograin, the state stockpiler, has already purchased nearly 40 million tonnes in the current marketing year, said CNGOIC.

   

   

On the import side, official customs data showed that the world''s second-largest corn consumer recorded less corn imports for the whole of 2014.

   

   

Corn imports may not rise this year, initially at least, as Beijing has delayed issuing 2015 import quotas, expected to be three million tonnes in total, industrial analysts told IHS Maritime.