China’s feed demand set for modest recovery in 2024-25

CHINA — According to a recent report from the Foreign Agricultural Service (FAS) of the U.S. Department of Agriculture, China’s feed demand is projected to experience a slight recovery in the 2024-25 marketing year.

The total feed demand is expected to reach 286.5 million tonnes, an increase from 284.7 million tonnes in the previous year.

This uptick is primarily attributed to a resurgence in pork and chicken production anticipated in the latter half of the market year.

Corn will remain the dominant ingredient in China’s feed mix, with its usage expected to rise to 235 million tonnes, up from 223 million tonnes.

The FAS attributes this increase to a significant drop in corn prices, which have reached a three-year low during the first seven months of 2024.

 “Lower corn prices will also encourage increased corn use in the processing sector compared to previous years,” the FAS noted.

The report highlights that operating capacity rates at corn processing plants have improved, climbing to 61% from 53% within the same timeframe.

This enhancement indicates a more profitable outlook for the corn processing industry, which benefits from lower input costs.

Furthermore, corn production is forecasted at 293 million tonnes for 2024-25, although this figure represents a slight decrease from earlier estimates due to adverse weather conditions such as flooding.

In addition to corn, China is expected to reduce its imports of feed grains slightly, estimating imports at 20 million tonnes—down by one million tonnes from previous forecasts.

This shift aligns with the Chinese government’s push for increased domestic production, including a campaign to boost grain production capacity by an ambitious 50 million tonnes by 2030.

The FAS also indicated that oilseed crushing will rise alongside improved feed demand. Total oilseed crushing is projected at 137.3 million tonnes for 2024-25, an increase from 135.3 million tonnes in the previous year.

“A moderate recovery of vegetable oil demand and greater soybean use for food also drove up consumption of oilseeds,” according to the FAS.

Soybean meals continue to dominate feed usage, accounting for over 74% of total meal consumption.

They are expected to reach 102.7 million tonnes, up from the 101.3 million tonnes previously estimated.

The FAS remarked that “overall feed consumption in 2023 is 3% higher than the previous year,” indicating a steady growth trend driven by increased animal product production.

The economic landscape also plays a crucial role in shaping feed demand. As living standards improve across China, demand for animal products and vegetable oils rises correspondingly.

The FAS projects that total vegetable oil consumption will increase to 35.6 million tonnes in 2024-25, up from 35.1 million tonnes.

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