This graph will show you what rising incomes and more meat consumption in China mean for the U.S. agricultural export market.
China’s demand for imported grains, much of it from the United States, has surged recently, with imports of cereal grains rising to 16 million tons in 2012 and 18 million in 2013. Imports in 2013 included 3 million tons of corn and 4 million tons of DDGS (distillers dried grains with solubles; a co-product of U.S. corn ethanol production used for feed) from the United States.
In 2013, the United States supplied 70 percent of China’s wheat imports and, for the first time, China became a major market for U.S. sorghum. China’s demand for feed grains appears to have reached a turning point, as a tightening labor supply and rising feed costs force structural change in China’s livestock sector.
Labor scarcity, animal disease pressures, and rising living standards are prompting rural households to abandon “backyard” livestock production and shift more production to specialized farm enterprises that rely more heavily on commercial feed. Because of this, China has switched from being a corn exporter to importing 3-5 million tons annually since 2009.
Rising feed demand has also pushed up costs and motivated feed mills and livestock producers to explore new feed ingredients like DDGS and sorghum.