China plans to boost production of biodegradable plastics made out of corn and increase the use of the grain as an animal feed in the next three years, the government said on Thursday the latest effort to absorb a domestic glut that has hurt prices.
Outlining its five-year plan for 2015-2020 for the grains and oils processing industry on Thursday, the state grain bureau said it would support the production of polylactide (PLA), a biochemical material made out of corn starch and sugar and used to produce plastic bags and tableware.
It also reiterated its plan to boost corn-based ethanol production by 2020.
The statement did not give any targets or further concrete details of the plan, but the document offers an insight into the government's thinking and illustrates the depth of concern about the country's large stockpile of ageing corn.
"The issue of grains oversupply is severe. The task to digest grains storage is arduous," the statement said.
China has built up huge state stockpiles of corn after years of buying the crop from farmers to support incomes.
After abandoning the policy earlier this year, it began to sell off its old stock but still has more than 200 million tonnes in warehouses, according to some estimates, but much of it is poor quality.
If it is no longer fit for human consumption, processors will have to find alternative uses for the grain.
By 2020, China will have more than 30 major grains and oils enterprises with annual income exceeding 10 billion yuan ($1.44 billion), the statement said.
That's almost double the number of companies operating in the sector in 2015.