China to face 500,000 ton corn deficit
China will face a 500,000-ton deficit in corn production this year, according
to the latest report from China National Grain and Oils Information Centre.
The prediction bring an end to the two-year production
surplus after the country ended years of deficit in 2004. The centre forecast
that annual corn consumption for 2006-2007 would reach 144.5 million tons, but
corn output would be 144 million tons.
Corn prices on the global market surged to a
ten-year high last month as a result of soaring demand in the United States for
ethanol fuel. Supply in China has continued to increase as farmers choose to
plant corn and reduce the amount of soybean and other crops.
However, due to
the expansion of the corn processing industry, which uses corn to produce
alcohol and starch, domestic demand has also boomed, observers said.
China ranks as the world's second largest corn producer after the United
States, accounting for 20% of the world's production.
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