As China reforms its corn market, farmers switch to growing soybeans

domingo 3 de abril de 2016 19:00 GYT

* Soybean output seen rising with more acreage, better seeds

* Domestic corn to trade near global price without govt support Scope for improving yields if GMO technology embraced

* Higher ethanol production may flood market with DDGs

By Naveen Thukral and Niu Shuping

SINGAPORE/BEIJING, April 4 (Reuters) - Wang Zhonghai, a 49-year-old farmer in China's top corn producing province of Heilongjiang, plans to switch 80 percent of his land to cultivate soybeans this year as the government ends a near decade-old corn price support scheme.

China announced last week it will stop its corn stockpiling programme and allow markets to set prices - a move that should transform the agricultural landscape as farmers shift to more lucrative crops like soybeans, rice and peanuts.

Rising demand for a protein-rich diet in China has since 2001 triggered a six-fold jump in imports of soybeans, which are crushed to make soymeal, an animal feed ingredient, and cooking oil.

Higher output in China, the world's top soybean importer, will hit farmers in top producers Brazil, the United States and Argentina. The trio have presided over a soybean boom, helping nearly double world production over 15 years.

"We calculated and to grow soybeans would give better returns than corn which gives no profit after the price drop," said Wang, who has grown only corn on his 6.7 hectare (16.5 acre) farm for years in Hule village in Heilongjiang.   Continuación...