China has bought 37% of next year’s corn imports just from U.S.

China has tapped the U.S. for more than a third of next season’s expected corn imports, accelerating its pace of buying from the world’s top supplier to fill its growing grain needs.

The Asian nation bought about 9.5 million metric tons of U.S. corn from the 2021-22 season so far this month, according to U.S. Department of Agriculture figures. The agency expects China to import around 26 million tons from worldwide suppliers for the period that begins in September.

China has been a key source of demand for grains to feed its rapidly expanding hog herd, helping push the price of crops to record highs, and there’s little indication its appetite is abating. The country’s purchases from the U.S., the world’s top corn supplier, is happening as dry conditions threaten crops in Brazil, which ranks second for global shipments of the grain.

Corn futures have slid about 13% from a eight-year high of $7.3525 a bushel on May 7, a peak that followed a run-up in prices that began mid-April. The most-active contract fell as much as 3.2% to $6.37 a bushel in Wednesday trading in Chicago.

“They’ve found a flat price that they like, and they continue to make purchases for delivery by next winter,” Arlan Suderman, chief commodities economist at StoneX, said in a note. “They want to have coverage in place with Brazil’s crop getting smaller and the U.S. crop facing undetermined risks for the growing season ahead.”

“Chatter within China reflects an expectation that Chinese buyers will continue to buy until they’ve booked closed to 15 million metric tons of U.S. new-crop corn,” Suderman said. A large chunk of purchases are going into the country’s cash market, he added, “suggesting that Chinese demand is much stronger than previously believed.”