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Demand for Corn

China is the world's second largest consumer of corn and demand continues to increase. It is also the world's second largest producer of corn behind the U.S., which may be surprising for a country whose main staple is rice.

Indeed, most corn in China isn't consumed by humans at all—75 percent of its corn consumption is used for animal feed. Corn consumption has grown consistently, rising nearly 3 percent each year for the past decade.

The country's corn imports will reach a record 5 million metric tons by the end of 2011, which is more than double the 2010 level of 2 million tons, according to the United Nations' Food and Agriculture Organization. That surge in demand has helped push corn prices on the Chicago Mercantile Exchange up 17 percent this year alone.

The underlying demand for grain-fed meat is being driven by rising wealth, which in turn is increasing meat consumption. Wealthier Chinese consumers are also demanding better quality meats. Rather than importing grain-fed meat, the government is encouraging farmers to adopt organic practices of feeding corn and soybeans to hogs and cows.

Photo: Chris Hackett | Getty Images