China will end its state corn stockpiling program this year, replacing it with other subsidies, amid surging reserves in the world’s second-biggest grower, the official Xinhua News Agency reported. The government will encourage state and private firms to buy corn at market prices and offer credit support to farmers, Xinhua reported late Monday [28 March 2016], citing a press briefing by the National Development and Reform Commission. It will also promote changes in crop cultivation and move to reduce existing stockpiles, the news agency said. The changes will affect the 2016-17 season…Full Article: The Korea Herald Mar 2016

Key Point

  • In 2008, China instituted a corn price subsidy program.

ChinaAg Comments

  • From 2015 to 2016, China’s Ministry of Agriculture hopes to decrease its corn cultivation area by 670,000 hectares. During the same time, according to Shandong’s Department of Agriculture, the province has decreased its wheat cultivation area by 8,333 hectares, the first such decline in eight years.
  • As of 2015, China’s northeast (e.g. Heilongjiang, Liaoning, Jilin and Inner Mongolia) had approximately 160 million MTs of corn in storage, or roughly 78% of China’s total corn reserves.
  • In November 2015, China announced plans to cut its corn production by 3.3 million hectares across 13 provinces/regions by the end of 2020. This decline in area will cut production by approximately 25 million MTs. According the Deputy Director of China’s Crop Production Department (under the auspices of the Ministry of Agriculture), the major corn producing regions of Liaoning, Jilin and Heilongjiang will see the largest declines in production area, while Shanxi, Shaanxi, Gansu, Guizhou and Yunnan will also be affected somewhat.
  • In September 2015, China decreased its corn purchasing price for state reserves by 10.7%, marking it the first decline since price support measures would introduced in 2008.
  • From 2003 to 2013, corn production in China’s northeast (e.g. provinces of Heilongjiang, Liaoning, and Jilin) increased from 6.3 million ha to 11 million ha.
  • From 2012 to 2013, Chinese corn production increased from 205 million MTs to 218 MTs. In 2013, Heilongjiang produced 32 million MTs of corn, accounting for 15% of China’s total output. Jilin produced 27 million MTs or roughly 13% of the country’s corn output.

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