Reshaping grain trade? China moves to change animal feed recipes
China issued guidelines on Wednesday recommending the reduction of corn and soymeal in pig and poultry feed, a measure that could reshape the flow of grains into the world’s top corn and soybean buyer.
China’s corn prices surged more than a third in the most recent year following a drop in output and state stockpiles. The country started importing a lot more corn to compensate for the domestic deficit. So feed makers have already been switching to cheaper alternatives, especially wheat.
Benchmark corn and soy futures on the Chicago Board of Trade notched fresh multi-year highs on Wednesday, so China’s new guidelines may not do much in the near term to temper soaring feed costs.
The Ministry of Agriculture and Rural Affairs said in a statement on its website the new guidelines are aimed at improving the usage of available raw materials and creating a formula that better suits China’s conditions.
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