BEIJING, Dec 30 (Reuters) - China's corn harvest rose by more than 10 million tonnes this year, Agriculture Minister Han Changfu said in a speech published on his ministry's website on Thursday.
The lengthy Dec. 21 speech, reflecting on 2010 and looking forward to plans for 2011 emphasised the difficulties of raising output further, including a lack of spare land. Among measures the government planned were increased agricultural subsidies and the implementation of genetically modified crop projects.
The ministry also published a speech by Vice Minister Wei Chaoan, who said China would no longer enjoy surplus corn supplies, although it would strive for self-sufficiency in corn, wheat and rice.
Corn demand is high because of the rapid expansion of the corn processing industry and animal feed production, he said.
The country's industrial processors are likely to need 70 million tonnes of corn next year, up from 60 million tonnes this year, accounting for more than one-third of the total, above the government's target of 26 percent, Wei said.
Those figures, implying demand of 180-210 million tonnes, are far above most estimates. A Reuters poll conducted in October showed a consensus forecast of 165 million tonnes of demand in the 2010/2011 marketing year. Analysts who gave a breakdown put processing demand at 35 million-50 million tonnes.
The ministry's latest figures were met with scepticism.
"The numbers are nonsense. They're impossibly high," said a China-based analyst at a foreign trading house. "It could foreshadow further government moves to control corn's industrial use in the future. Corn prices are too high and China first needs to be sure it can meet feedmeal demand."
Wei said demand from feedmills, which use much more corn overall than processors, was rising more slowly.
"According to expert analysis, in general the annual increase in feedmeal demand is about 3 million tonnes, with protein-rich meal going up by more than 1.5 million tonnes," Wei said.
RICE
China is still focused on complete self-sufficiency in corn, wheat and rice, although supply of short-grain Japonica rice, the staple food for the world's most populous country, is very tight, Wei said.
"According to our estimates, Japonica rice demand will rise by more than 12.5 million tonnes by 2015, and the contradiction between supply and demand will be significant," Wei said.
Han said output of Japonica rice rose by more than 4 million tonnes this year, without giving any comparative figures.
Japonica rice is grown in northern China but its popularity has spread south into areas where long-grain rice is grown.
China will stabilise its overall grain production capacity at above 540 million tonnes, said Wei. That implies little further production growth, since grain output rose 2.9 percent to 546.41 million tonnes in 2010.
"The less price-elastic growth in grain consumption is an inevitable trend, and the situation of supply exceeding demand will never return," Wei said.
He said it was also hard to guarantee adequate supplies of cotton, vegetable oils and sugar but it has some aggressive targets under the country's twelfth five year plan, which runs from 2011 to 2015.
China aims to have oilseeds output at above 35 million tonnes, with self-sufficiency at above 40 percent, while cotton output is targeted at above 7 million tonnes, Wei said. China should guarantee sugar self-sufficency above 90 percent, with output of sugar crops at around 140 million tonnes.
Oilseed output is expected to be above 31.5 million tonnes in 2010, roughly the same as last year despite increased acreage, while cotton output in 2010 is forecast to fall 2.8 percent to 6.2 million tonnes, he said.
Han also said China's meat output would rise 2.6 percent to 78.5 million tonnes this year, while egg production would rise 1.5 percent to 27.6 million tonnes and dairy output would increase 0.2 percent to 37.4 million tonnes.
The number of hogs slaughtered was up 1.5 percent at 655 million head, he said. Low prices of hogs in the first half of this year had prompted the government to support the market by temporarily stockpiling 170,000 tonnes of pork, he said.
