Why import corn stocks so high?

China's corn is basically self-sufficient, and there is a quota limit of 7.2 million tons of corn imports every year, which is nothing compared to China's corn output of 200 million tons.

However, since last year, many "allied forces" have come to import corn, and so-called foreign import substitutes such as barley, sorghum and DDGS swarmed into the country. Coupled with 15 years of corn market supply, poor demand, temporary storage reform and other factors, led to a continuous decline in corn prices. However, since September 1 last year, the Ministry of Commerce began to include barley, sorghum and DDGS in the new automatic license, while conducting an anti-dumping investigation against the DDGS of the United States, resulting in a significant decline in the import of substitutes in the first half of this year.

By contrast, corn imports increased unabated in the first half of this year. Customs data show that from January to May 2016, the cumulative import of corn reached 2.8379 million tons, an increase of 59.64 percent over the same period last year. One of the most favored sources of corn imports is the United States, and the other is Ukraine. In the first five months, China imported 2.65 million tons of corn from Ukraine, accounting for the vast majority of total imports, while imports from the United States were about 130000 tons.

In theory, why do large producers of more than 200 million tons of corn import so much corn every year? In addition to the accident that there is a performance-to-price ratio of foreign corn, the shortage of grass-roots mobile corn supply after the completion of temporary storage acquisition is also the main reason for the phased increase in imports. But don't forget that the import quota of 7.2 million tons is here, coupled with the policy makers holding high the banner of "destocking", the country still has 260 million tons of corn to digest, compared with this year's imported corn.