Grain harvest increases again

China, the world's largest wheat and rice producer, saw a rise in grain output this year for the ninth year in a row, but it is still not enough to meet rising domestic demand, an analyst told the Global Times Sunday.

The country had a grain yield of about 590 million tons in the 2012 harvest, up 3.2 percent from a year ago, the National Bureau of Statistics (NBS) said in a statement on its website Friday.

China also imported 60.9 million tons of grain in the first 10 months of this year, up 34 percent year-on-year, with soybeans accounting for approximately 80 percent of the grain imported, according to customs data.

Apart from soybeans, the quantity of imported grain including wheat, rice and corn was more than triple the quantity imported during the same period of 2011, the data showed.

Amid the faltering global economy, grain in the international market is selling at cheaper prices than grain produced at home, which is why major food processors such as COFCO Group are buying more of it and boosting imports so much, Ma Wenfeng, an analyst with Beijing Orient Agribusiness Consultant Ltd, told the Global Times Sunday.

Another reason for the rise in imports is the need to replenish the country's grain inventory, which is about 40 percent of one-year's grain consumption, a level high enough to ensure food safety, Ma said.

Grain consumption is also on the rise for industrial purposes such as liquor making, and production of biofuel ethanol from corn is estimated to grow by about 8 percent this year, outpacing the growth in grain output, Ma said.

"This is the first time that there have been nine consecutive years of growth in grain output since the People's Republic of China was established (in 1949)," Chen Xiwen, director of the Office of the Central Rural Work Leading Group, said at a forum Thursday.

Despite the continued growth in grain output, domestic supply is still falling behind the increasing demand, which is why imports of agricultural products are rising so fast, Chen explained.

Imports of soybeans are expected to surpass 55 million tons for the whole of 2012, equal to half of the world's total soybean exports, Chen noted.

Without imports of these agricultural products, China would have needed another 600 million mu or 40 million hectares of farming land for grain production, equal to a quarter of the country's existing area of farming land, Chen noted.

China needs to import soybeans in large quantities to produce cooking oil for human consumption as well as feed for the expanding livestock sector, said Luo Yunbo, dean of the Food Science and Nutritional Engineering College at China Agriculture University.