China’s corn-based ethanol fuel threatens food security while crowding the market, state commentary warns
- China is facing a corn-supply shortfall that could put it at the mercy of imports, even as domestic output has seen sharp increases in the last couple of years
- Beijing has been increasingly pushing to reduce its reliance on external sources of crucial grains, including soybeans
China must rein in the expansion of processing capacity for corn-based ethanol fuel to ensure that the nation has enough corn to meet its agricultural demands and to reduce its reliance on external sources, according to a recent commentary in state media.
More than 60 per cent of the corn China uses goes toward animal feed, and 20-30 per cent is allocated for industrial use, the commentary in the Economic Daily said on Thursday, adding that the rapid expansion of corn-based ethanol fuel capacity is crowding the market and pushing up corn prices by raising demand.
This has a direct impact on the nation’s food security, the piece warns, calling for more efforts to address the corn-supply shortfall.
“The processing of corn-based ethanol fuel must serve the overall situation of national food security,” the commentary said. “The country, with a large population but limited arable land, is always faced with maintaining a fine balance between food supply and demand.
“We cannot process grain-based ethanol fuel on a large scale like the United States does. Doing so would jeopardise the fundamentals of food security.”
Corn ethanol, produced from corn biomass, is the main source of ethanol fuel in the US. China started producing corn-based ethanol fuel in 2000 as a means to utilise an excess supply of corn. Domestic corn output gradually declined from 2016-18 before starting to trend upward, with sharp increases in the last couple of years.
Since last year, China has been putting more controls on the processing of corn-based ethanol fuel, shifting from a policy of “moderately” developing grain-based fuel ethanol that was put forth in 2017.