Grain imports have slowed down comprehensively

Since 2020, the supply of corn in the domestic market has been temporarily tight, leading to a continuous rise in corn prices. Taking the Northeast production area as an example, the spot price of corn has risen from about 1900 yuan/ton in 2019 to a peak of 2900 yuan/ton in 2023, with some regions even offering prices close to 3000 yuan/ton. For example, on March 5, 2023, COFCO Bio Energy (Gongzhuling) quoted a price of 2760 yuan/ton for third class and above dry grain, which is 120 yuan/ton higher than the same period last year. The futures market also rose from a low of 1780 to 3120 during this period, with a cumulative increase of 75.28%. Against this backdrop, the combined effect of the price advantage of imported grains and the overall tight supply of domestic corn has led to a large-scale entry of imported grains such as corn, wheat, sorghum, and barley into the domestic market, especially in the field of feed processing, replacing a large proportion of domestic corn.

Analysis of Imported Grain Consumption

From the perspective of the structure of grain imports, the vast majority of the increase in corn, sorghum, wheat, and barley since 2021 has been used as energy raw materials to ｒｅｐｌａｃｅ corn in the feed processing field. With the adjustment of the domestic corn planting structure, supplies such as wheat and brown rice mixture have entered the market, gradually easing the tight supply situation of the corn industry chain and achieving a relatively loose stage. After entering 2024, the domestic corn market will face a rare bear market due to the impact of the new season corn market and the continuous influx of imported grain inventory. In 2024, the sustained suppression effect of large-scale grain imports on market prices is gradually becoming apparent.

With the continuous decline of domestic corn prices, the prices of foreign grains (including corn) have begun to rebound. In addition, the US dollar is gradually strengthening, and the cost-effectiveness of imported grains is gradually decreasing. After entering the fourth quarter of 2024, the consumption proportion of imported grains in the domestic feed processing field shows a significant downward trend.

At the same time, relevant regulatory measures have also been successively introduced, including scale restrictions on grain imports and a series of measures such as the official suspension of imported corn auctions. The consumption share of imported grains in the domestic market has shown a cliff like decline for a time.

Prediction of Future Grain Import Situation

Looking ahead to the grain import market in 2025, whether from the perspective of the current price advantage of domestic corn or from the perspective of policy regulation, further reduction in grain import scale is the trend. The expected large-scale reductions in corn and wheat returning to the scale of the conventional quota system, as well as the significant reduction in the cost-effectiveness of sorghum and barley, are currently highly probable events. The Central Economic Work Conference at the end of 2024 will also prioritize "vigorously boosting consumption, improving investment efficiency, and expanding domestic demand in all aspects" as one of the nine key tasks for next year. Returning to the corn market itself, after nearly five years of large-scale import supply and a series of effective measures such as adjusting planting structure and optimizing yield, reducing dependence on the international grain market and expanding domestic demand are not only effective ways to cope with external shocks and stabilize economic operation, but also long-term strategies to enhance development initiative.