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Supply-side reforms revitalize corn market

Updated: 2017-03-06
(chinadaily.com.cn)

Since supply-side reforms and market orientation were applied to the corn industry in China's rural areas, excessive production capacitieswere effectively cut, said a delegate of the National People's Congress (NPC).

"Before 2016, the country was wholly responsible for purchasing the corn produced in Northeast China. Farmers only grow the kind of corn with high yield, resulting in a gap between supply and demand," described Tong Yi, a member of NPC from COFCO Corporation.

In the context of economic transformation and supply-side structural reform, plantation structure has begun to reshape itself. Corn farmers try to keep up with the surging demand of buyers by "switching their practices from growing "all-China" kitsch to special, high-quality corn that can be deep-processed or used as fodder," Tong Yi explained. Acres for green, waxy, organic and high-oil corns are also increasing with an surging amount of orders.

Tong Yi believes that the structural reform of the agricultural supply side will effectively reduce the "three high" problems in the production, import and stock of corn in China. "Further optimization of the corn planting structure will cut downon unsuitable planting areas,"said Tong Yi.

He added that as China now promotes market pricing and subsidizes the price difference between the target price and the market price to stabilize farmers' incomes, and adjusting planting structures is undergoing intense revitalization.

Tong Yi said that with the help of the national corn market strategy and export tax rebate policy on deep processing products, in 2016 China exported 132,800 tons of corn starch, a year-on-year increase of 80 percent and the highest in the past five years.Corn fructose exports reached 500,000 tons, a year-on-year increase of 65 percent -- the highest in history.

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