Market year 2017-18 rice, wheat, sorghum, and barley production are forecast slightly higher on reports that more corn farmers are turning to alternative crops. Market year 2017-18 corn production is forecast to decline 1% from market year 2016-17, although some recent industry planting surveys suggest that corn production could decline even more, especially in northeast China.
Based on China’s official statistics, calendar year 2016 overall grain production fell to 219.5 million tons, down 6.1 million tons from 2015. The decline ends a 13 season streak of record production. China estimates that corn production accounted for an estimated 83% of the total decline in grain production.
Even though the central government has signaled a move toward a market-oriented corn policy, reforms will not take effect immediately. Officials will continue to administer local, provincial and central government interventions in the near-term to partly compensate producers for lower revenues, support prices, and offset the costs of switching production to other crops with relatively lower producer margins. The National Development and Reform Commission (NDRC) aims to improve its minimum purchase price for rice and wheat and reduce state grain stocks of corn and wheat.