MARKET ANALYSIS

CHINA ISSUES GUIDANCE ON REDUCING CORN, SOY USE IN FEED

The guidelines include recommendations for alternative ingredients, “with the goal of improving the usage of available raw materials and creating a formula that better suits China’s conditions. The new guidance recommends rice, cassava rice bran, barley and sorghum as alternatives to corn. Acceptable alternatives to soybean meal include rapeseed meal, cottonseed meal, peanut meal, sunflower meal, distillers dried grains, palm meal, flaxmeal, sesame meal and corn processing byproducts.

The guidance also suggests feed formulations based on the region of the country. Soybean meal consumption in China will increase 6% year over year, and China is expected to import large amounts of feed grains, mostly from the U.S., in 2021. Wheat use in feed is expected to see a “significant boost” as China’s state reserve offers old/stale wheat and paddy rice to feed mills at lower prices. “In addition, mills are increasingly using wheat to replace corn in the feed formula. As wheat has a higher protein level, the use of soymeal will also be adjusted accordingly.