China, Mexico Purchases of U.S. Corn Pushing Prices to Levels Not Seen Since 2013
With China purchasing 10.744 million tons of U.S. corn for the 2021/22 season more than three months before the new marketing year even begins, the U.S. is on a historic pace for export sales.
Mexico is the second largest buyer of U.S. corn, buying 1.808 million tons of corn for the new marketing year as of May 20, according to the U.S. Grain Council (USGC). USGC director in China, Bryan Lohmar, noted that some of the corn purchased by China will likely be destined for the country’s state reserve, however, how much is unknown. And what is allocated to the state reserve may be just annual replenishment, rather than making up for depleted reserves. Corn feed demand in China is also increasing due to higher poultry production and the country’s goal of modernizing its pork production systems, with U.S. corn going directly to feed mills in support of this activity and growth. Questioned about whether this higher demand is only temporary, Lohmar stated that large volumes of wheat and rice also being allocated into feed rations is an indication that feed grain demand is real.