Reshaping grain trade? China acts to change animal feed recipes
China issued guidelines on Wednesday recommending the reduction of corn and soymeal in pig and poultry feed, a measure that could reshape the flow of grains into the world’s top corn and soybean buyer.
Chinese feed makers have already been switching corn for cheaper alternatives, especially wheat, after the grain rallied by more than a third in the last year following a drop in corn output and state stockpiles.
Imports of corn, used largely in animal feed, into China surged as it sought to compensate for the domestic deficit.
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China Raises Floor Price For Wheat Auctioned From State Reserves
China raised the floor price for wheat auctioned from state reserves on Monday, a government notice said, in an effort to dampen demand for the food grain. The floor price for most of the wheat put out for weekly sale from state reserves was raised to 2,350 yuan ($358.99) a tonne, up from 2,290 yuan set in 2019, a notice on the website of the National Grain Trade Center said. Chinese traders and feed producers have been scooping up wheat from state reserves to substitute for corn in animal feed because of soaring corn prices. The buying spree has pushed up prices of staple food grain wheat.
4/12/2021 (Tweaks headline, lede, updates with floor price) By Hallie Gu and Dominique Patton BEIJING, April 12 (Reuters) - China raised the floor price
for wheat auctioned from state reserves on Monday, a government
notice said, in an effort to dampen demand for the food grain. The floor price for most of the wheat put out for weekly
sale from state reserves was raised to 2,350 yuan ($358.99) a
tonne, up from 2,290 yuan set in 2019, a notice on the website
of the National Grain Trade Center said. Chinese traders and feed producers have been scooping up
wheat from state reserves to substitute for corn in animal feed
U.S. white wheat growers cash in as China snaps up supplies
China is scooping up supplies of U.S. white wheat to feed livestock, pushing export forecasts for the grain usually used to make sponge cakes and noodles to a 27-year-high.
The purchases are the latest disruption in commodities markets caused by Chinese buying of grains and oilseeds during the coronavirus pandemic, pushing prices of major commodity crops to multi-year highs.
China has booked more U.S. white wheat this year than any country besides the Philippines, the top buyer of the grain. While U.S. producers have long tried to woo the growing Chinese market for confectionary foods made from white wheat flour, the recent purchases reflect a need for animal feed, Chinese traders and analysts said.