China's grain imports accelerate as Chinese farmers hang onto stocks for higher prices

On July 24 we asked: "Is China stocking up on corn, beans as a buffer against flood damage to China's crops?" New evidence confirms "yes" — even though official Chinese stocks report claim a great 2020 crop and abundant stocks. 

August 17, 2020 — Here's a headline in today's South China Morning Post: "China drought, heavy rains spark concern over grain supply as Xi Jinping launches campaign against food waste."  The author, Orange Wang, writes that "Many farmers are hoarding crops in expectation that prices will continue rising because of low supply, traders say."

Dry weather early in the season, then torrential rains during late summer in key crop-growing regions, plus Covid-19 stress, caused disruptions which local farmers see, but official statistics may not reflect accurately. 

The South China Post report says President Xi Jinping "emphasized grain supply security during a visit to Jilin province in July and again last week when he made an unusual instruction for people not to waste food."

As in the days of Mao Zedong, communist officials across the nation amplified their leader's statement about reducing food waste into a national campaign. Such a powerful reaction probably wouldn't have resonated widely unless facts on the ground amplified it. Some officials even talked of punishing food waste.

Another signal: Last week Chinese grain importers ordered 32 million bushels of U.S. grain sorghum, a record weekly sale.  Ag Professional has an extensive report on the sale here

Our earlier report on China's purchases focused on China's persistent flood damage this season.

Update September 16:  Canadian ag market analyst Mike Jubinville reported this evening:

"The corn market is increasingly taking note of crop damage in China stemming from three late-season typhoons following flooding earlier in the season. That, paired with high Chinese corn prices and reports of depleted stockpiles, has analysts calling for a big jump in Chinese corn imports. Some sources are signaling China could bring in anywhere from 15 MMT to 30 MMT of corn from all origins, with most estimates coming in the 20 MMT to 25 MMT range. That's a staggering amount of imports. In contrast, USDA last week projected China would import just 7 MMT of corn in 2020-21."