Developing Markets | Enabling Trade | Improving Lives US/China Grain Trade Trends and Challenges Rebecca Bratter, Director Trade Development Agricultural.

Developing Markets | Enabling Trade | Improving LivesDeveloping Markets | Enabling Trade | Improving Lives

US/China Grain Trade

Trends and Challenges

Rebecca Bratter, Director Trade Development

Agricultural Outlook ForumFebruary 24, 2011

Developing Markets | Enabling Trade | Improving Lives

Percent GDP Growth

2008 2009 2010 2011World 1.7 -1.9 3.9 3.5Latin America 4.2 -2.3 5.9 4.4USA 0.0 -2.6 2.8 2.9Canada 0.5 -2.5 3.0 3.2UK -0.1 -4.9 1.8 1.8Japan -1.2 -6.3 2.4 2.1China 9.6 9.1 10.5 9.8India 5.1 6.8 9.1 8.1


China: Growing Market Dynamics bring growing opportunities

• Population 1.3 billion• Rapid rise in incomes Changes in diets• Middle class to grow to 700 million, 75%

Urban • Per capita income: – TODAY $5,000– SOON $10,000 - $40,000


China in World Agriculture

• #1 producer of cotton, rice, pork, peanuts, numerous fresh fruits, milk

• #2 producer of corn• #1 importer of soybeans, cotton

Source: USDA/FAS PSD online


China -Transition and Uncertainty

• Food security concerns• Lack of supply/demand information• Shift from self-sufficiency policy, net exporter

to net importer• Declining corn stocks• Food price inflation


China Corn Consumption v. Production

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010-20,000

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

Total Use minus Production

Production

Total Use

Thou

sand

s m

etri

c to

ns


China Import Trends

CHINA CORN & DDGS

USGC in the market since 1982

Exported 2.4 MMT DDGS to China

First significant purchases of corn since 1995 DDGS Corn

0

500000

1000000

1500000

2000000

2500000

3000000

600000

0

2400000

1400000

Exports 2009-2010

20092010

MMT


China Corn Import Outlook

1990/91

1992/93

1994/95

1996/97

1998/99

2000/01

2002/03

2004/05

2006/07

2008/09

2010/11

2012/13

2014/15

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

th.m

t. We are Here

?


China DDGS Imports (Jan-Dec)

2008 2009 20100

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

6,761

655,165

3,164,204

Met

ric

tons


China Corn Stocks to UsePrivate estimates

19921993

19941995

19961997

19981999

20002001

20022003

20042005

20062007

20082009

20100%

10%

20%

30%

40%

50%

60%

70%

80%


Commercial Hogs Consume Grains

20042005

20062007

20082009

20102011

20122013

20142015

0%

10%20%30%

40%50%

60%70%80%90%

Percent of Hogs in Commercial Production Facilities

35%

65%




Growth of dairy feed is faster than swine, poultry and beef cattle

Dairy Feed Total Feed0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

13.97%

2.18%

Growth Rate


U.S. Corn Yield Projections

11.61

13.06

14.19

13.12

16.63

18.14

0

2

4

6

8

10

12

14

16

18

20

1970

/197

1

1973

/197

4

1976

/197

7

1979

/198

0

1982

/198

3

1985

/198

6

1988

/198

9

1991

/199

2

1994

/199

5

1997

/199

8

2000

/200

1

2003

/200

4

2006

/200

7

2009

/201

0

2012

/13

2015

/16

2018

/19

2021

/22

2024

/25

2027

/28

2030

/31

mt/

ha

Actual

Trend 1

Trend 2

Trend 3


U.S. Ethanol Production

0

2000

4000

6000

8000

10000

12000

14000

16000

2003

/4

2004

/5

2005

/6

2006

/7

2007

/8

2008

/9

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

mil

lio

n g

all

on

s

Growth

Production


U.S. corn producers’ commitment

• Increase quality and timeliness of market information

• Increase production to meet export needs• We never close. Exports available every day.• Continue to innovate, adapt technology.• Sustain infrastructure to meet world demands.


USDA Import Projections

2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/210

20

40

60

80

100

120

140

China

Other

Western Hemisphere

SEA

Asia

Middle East

North Africa

Europe

mill

ion

met

ric

tons

113 mmt = 4.45 bbu


China Possible

2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/210

20

40

60

80

100

120

140

China

Other

Western Hemisphere

SEA

Asia

Middle East

North Africa

Europe

mill

ion

met

ric

tons

125 mmt = 4.92 bbu


US Corn Outlook

2009/10

2010/11

2011/12

2012/13

2013/14

2014/15

2015/16

2016/17

2017/18

2018/19

2019/20

2020/21

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

ProductionExportsFeed/ResidualFSIDomestic useEnding Stocksm

illio

n bu

shel

s


Corn outlook plus China

2009/10

2010/11

2011/12

2012/13

2013/14

2014/15

2015/16

2016/17

2017/18

2018/19

2019/20

2020/21

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

ProductionExportsFeed/ResidualFSIDomestic useEnding Stocksm

illio

n bu

shel

s


Concluding Thoughts

• How much will corn will China import• How much will China’s corn demand impact

US stock to end/use ratio• Impact on corn prices• What about DDGs • Is the US prepared for the impending wave of

demand• How will China manage transition to net

importer?

Developing Markets | Enabling Trade | Improving LivesDeveloping Markets | Enabling Trade | Improving Lives

Thank You

Developing Markets | Enabling Trade | Improving Lives US/China Grain Trade Trends and Challenges Rebecca Bratter, Director Trade Development Agricultural.

Documents

china markets

producer of corn

special corn

producer of cotton

china transition

productiondeveloping

mmtdeveloping markets

livesdeveloping markets