Upheaval in China’s Corn Market: Will China expand its Tariff Rate Quota for Corn?

Date
2020-10-01
Authors
Hayes, Dermot
He, Xi
Hayes, Dermot
Zhang, Wendong
Zhang, Wendong
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Center for Agricultural and Rural Development
Abstract

China’s recent corn price and import hikes beg the question of whether it will expand its corn tariff rate quota (TRQ) to meet growing demand. While China’s corn price increased by about 30% from $6.59/bushel in January 2020 to $8.41/bushel in August 2020 (MARAC 2020), China’s corn imports also reached a record 5.59 million metric tons (MMT) as of August 2020 (GACC 2020). In addition, USDA weekly sales reports show China ordered 2.11 MMTs of corn sales for the 2019/20 marketing year and an additional 9.24 MMTs for the 2020/21 marketing year as of September 10, 2020. USDA daily export notices also show that China ordered 350,000 and 140,000 metric tons of corn on September 14 and 22, respectively (USDA 2020a). If we assume that China will import as much corn from non-US countries from September to December 2020 as it did from September to December 2019, and that the United States exports the 9.24 MMT in booked sales to China in 2020, then China’s total corn imports will reach 15.7 MMT in 2020.

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