The State Grain Bureau issued a plan on Dec. 24, instructing China Grain Reserve Corp. to procure 20 million MT corn in the Northeast before May, 2009, for state reserve. The plan consists of procurement of 3.3 million MT corn in Inner Mongolia, 3.5 million MT in Liaoning, 8.7 million MT in Jilin and 4.5 million MT in Heilongjiang.
Prior to this, the central government had twice issued plans on corn procurement in the Northeast, 5 million MT each time.
China’s corn supply exceeded demand by 15 million MT before the government’s procurement, without concerning changes in corn stock. The government’s plan of 30 million MT procurement in the Northeast accounts for more than 1/2 of the corn production in the Northeast. This, plus local consumption for industrial and feed uses, leaves little for outshipment.
As the government is expected to deliver reserved corn to auction in southern provinces, corn price is presumed to be stable next year.
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