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China’s Grain Imports Reach Record With a Growing Reliance on Brazil

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China’s soaring import volumes of grains and soybeans continued into 2023, with Brazil for the first time contributing a double-digit share of corn shipments. With China seeking to diversify food purchases away from the US, the Asian country is expected to increasingly rely on Brazil to meet its growing import demand. 

China’s grain imports have been rising strongly for years, and corn imports are up more than twentyfold since 2010. In February of this year, imports of both corn and wheat reached record volumes. Corn shipments for the month were up nearly 60% from a year earlier, with the US accounting for nearly 40% of the total and Ukraine and Brazil each representing about a one-quarter share. 

China opened its corn purchases to include Brazil last spring, as Gro wrote about here, partly to replace grain shipments blocked by the Russia-Ukraine war. This year, Brazil looks set to take an even greater role as higher corn acreage and favorable weather look set to deliver a record harvest, based on Gro’s machine learning-based yield forecast model

Brazil’s corn exports typically peak after May, and they represent major competition to US sales. Roughly 25% of total US corn export volumes currently go to China. US corn sales to China were valued at $5.1 billion for 2021. China has purchased roughly 2.75 million tonnes of US old crop corn since mid-March.  

China’s rising imports of grains and soybeans, much of which goes for animal feed, are largely driven by domestic pork demand. In January and February, Chinese pork consumption rose by more than 50% from a year earlier, as COVID pandemic restrictions were eased. 

While such a fast growth rate isn’t sustainable, Gro expects continued year-over-year increases in pork demand in 2023 and 2024, based on Gro’s China Pork Demand Forecast Model. Healthy inventories of hogs also will ensure strong demand for grain this year. 

Higher wheat imports so far this year have been supported after import margins turned positive in January. But increases in corn import volumes came despite negative import margins

China’s soybean imports also increased in the first two months, up 16% from a year earlier, although volumes were down in February from January. A majority of the soybean imports in February came from the US as Brazil faced setbacks due to heavy rains. But the large Brazilian soybean supplies expected to arrive over the next few months, as Gro wrote about here, may have China less interested in US soybeans until next year. 

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