China import cassava chip for produce ethanol, import cassava starch for produce modified starch used in papermaking and textile industry.
The price of cassava for export has been depressed by news of China reducing its Thai imports, following the Chinese government policy to subsidize maize. As a result, Chinese manufacturers that produce alcohol from cassava have switched to corn.
Department of Foreign Trade (DFT), ministry of commerce, has assured Thai cassava exporters that China will not reduce its long-term cassava imports from Thailand.
The cassava starch production in China is seasonal; the waste water management is difficulty, for environmental protective, the government asks for cut down the cassava starch mill to 12 from 50 in last year. For example, in Wuming county, only 3 starch mill will be retained in the end of this year, but now there are about 30. Only two ethanol mill will retain from 4.
Also that last year, Chinese government buy 70 million tons of corn from domestic for preservation store, so now in China has almost 100 million tons of corn in the storehouse. The storage period cannot over 4 years.
DFT Director-General Duangporn Rodphaya assured that the Chinese government's policy is short term and will only affect certain corn-producing counties. She added that China’s Ministry of Agriculture said it will encourage farmers to reduce the size of corn plantations in 2016.
Moreover, China has also made a pledge at the recent joint-commission meeting on trade, investment and economic cooperation onDecember 17 not to reduce Thai imports of cassava.