China Poultry Production Drives Bullish 290 MT Feed Demand

China poultry production is emerging as a critical variable in global agricultural commodity markets, exerting sustained demand pressure on corn and soybean supply chains. The USDA's Foreign Agricultural Service forecasts global chicken meat production at a record 109.6 million tonnes in 2026, with China registering the largest gains among all major producing nations. The expansion is anchored in vertically integrated white broiler operations, which have transformed the structure of China's livestock sector and, by extension, the composition of its feed grain requirements.

The implications extend well beyond the poultry sector itself. China's total feed and residual use of major grains is projected at 289.5 million tonnes for the 2025-26 marketing year, representing an increase of 6.5 million tonnes from the prior period, according to USDA estimates published in January 2026. This trajectory reflects a broader structural shift in Chinese protein consumption patterns that is reshaping global trade flows for corn, soybeans, and supplementary feed grains.

China Poultry Production and the White Broiler Expansion

The structural composition of China's poultry industry has undergone a fundamental transformation over the past five years. White broilers now account for approximately 70% of total chicken meat output, up from roughly 50% just five years prior, according to USDA FAS data. Yellow broilers, the traditional Chinese variety, have declined to a 17-20% share, while hybrid broilers occupy the remaining 8-10%.

This shift carries direct consequences for feed demand. White broilers reach market weight in six to eight weeks, operate at higher feed conversion ratios, and are suited to the processed poultry products increasingly favoured by Chinese consumers and quick-service restaurant chains. The vertically integrated companies that dominate this segment reported higher profits in early 2025 despite declining chicken prices, positioning them to maintain moderate capacity expansion into 2026.

Total poultry meat production in China rose 3.8% in 2024 to 26.6 million tonnes, according to the National Bureau of Statistics. The number of broilers slaughtered reached a record 13.56 billion head in the same year. For 2026, the USDA FAS projects continued growth, though at a slower pace than 2025, as market saturation and cautious behaviour among standalone broiler farms constrain acceleration.

Corn Feed Demand Remains the Dominant Cost Driver

Corn feed demand represents the single largest component of China's grain utilisation. The FAS projects corn consumption at 321 million tonnes for the 2025-26 marketing year, a 1% increase from the prior period, with approximately 67% of that total allocated to animal feed. Domestic corn production is forecast at 298 million tonnes, leaving a persistent deficit that Beijing is managing through targeted imports and strategic reserve releases.

The poultry sector is a primary beneficiary of corn's price competitiveness. Large feed mills reported using 6% more corn in the first seven months of 2025, as corn displaced costlier alternatives such as sorghum and barley in feed rations. Wheat has also re-entered the feed chain in certain regions: the FAS noted that wheat's energy profile and lower toxin risk made it a viable substitute in poultry rations, particularly after quality concerns emerged in parts of the 2025 corn harvest.

For the 2026-27 marketing year, corn consumption is forecast to climb further to 323 million tonnes, with production reaching 305 million tonnes. Feed demand from both stable swine production and stronger poultry output underpins this projection. Total feed and residual use of major grains is forecast at approximately 290 million tonnes, reinforcing the global feed market's exposure to China's livestock trajectory.

Declining Imports and the Self-Sufficiency Pivot

China's corn imports have declined sharply, falling from 23.4 million tonnes in 2023-24 to a forecast of just 7-8 million tonnes in 2025-26. This contraction reflects a deliberate policy decision. Beijing has tightened tariff-rate quota administration, imposed retaliatory tariffs on U.S. agricultural products, and used domestic reserve auctions to manage supply.

The 2026 No. 1 Document, released in February 2026, codified this approach. The policy framework establishes a grain production target of 700 million tonnes, an increase of 50 million tonnes over the prior benchmark, to be achieved primarily through yield improvements and genetically engineered crop adoption rather than acreage expansion. The FAS noted that China continues to stimulate local production by restricting grain imports to protect domestic farmer interests.

Soybean Meal Imports Under Conflicting Pressures

Soybean meal imports present a more complex picture. China's Ministry of Agriculture and Rural Affairs set a target to reduce the soybean meal inclusion rate in feed rations by 0.5% annually, from 14.5% in 2023 to 13.0% by 2025. The objective was to reduce the country's structural dependence on imported soybeans, which totalled 106 million tonnes in 2025-26.

In practice, low soybean meal prices have undercut this strategy. The FAS reported that cheaper meal prices through 2025 actually incentivised higher inclusion rates, driving crushing demand upward. The USDA projects soybean imports at 108 million tonnes for 2026-27, a 2 million tonne increase year on year, with robust demand from the poultry and aquaculture sectors offsetting weaker growth from the swine segment.

China resumed purchases of U.S. soybeans following the October 2025 meeting between Presidents Trump and Xi in Busan, South Korea, where both sides agreed to suspend certain retaliatory measures. As of late February 2026, China had purchased or shipped 10.8 million tonnes of its planned 12 million tonnes of U.S. soybeans, with trade framework commitments pointing to purchases of 25 million tonnes or more for 2026.

Global Feed Market Implications of Diversified Sourcing

China's feed procurement strategy is increasingly defined by supply diversification, carrying significant consequences for established trade corridors. For corn, Beijing has shifted purchasing toward Brazil and Russia while reducing U.S. exposure. China has not booked any U.S. sorghum shipments since March 2025, according to FAS reports, and retaliatory tariffs have suppressed bilateral grain flows across multiple categories.

The USDA projects U.S. agricultural exports to China will total just $9 billion in 2026, down from $17 billion in 2025 and the lowest level since the 2018 trade war. This reorientation has created competitive dynamics across global feed markets: Brazil faces mounting pressure to redirect record soybean production volumes, while Australian and Argentine sorghum suppliers contend with limited combined capacity of approximately 4 million tonnes.

The global feed market is also adapting to China's growing role as a chicken meat exporter. Chinese processed poultry products retain a price advantage in key markets, with exports forecast to grow in 2026 across Russia, Southeast Asia, Africa, the EU, and the UK. Higher exports compound feed demand domestically, as each additional tonne of chicken shipped abroad requires feed grain inputs produced or imported by China.

Feed Self-Sufficiency and the Vertical Integration Factor

Feed self-sufficiency stands at the centre of Beijing's agricultural modernisation agenda. The 2026 No. 1 Document introduces a new directive to coordinate agricultural imports with domestic production, effectively signalling that China will manage the pace and volume of feed grain imports to protect its domestic industry.

Vertical integration in the poultry sector is a core enabler of this strategy. Integrated companies manage the full chain from hatcheries and feed mills to slaughterhouses and processed product lines, achieving more predictable feed conversion outcomes than fragmented smallholder operations. As smaller farms exit the market, these integrated operators absorb capacity and consolidate demand for commercially formulated feed rations.

Poultry feed is China's second-largest feed segment, representing approximately 40% of total compound feed output. Broiler feed consumption reached an estimated 96-97 million tonnes in 2024-25, according to USDA data, and is projected to exceed that level as white broiler and hybrid broiler operations expand. Industrial feed production in China totalled 322 million tonnes in 2025, up from 313 million tonnes the prior year.

Alternative Feed Sources and Efficiency Gains

Beijing is also exploring structural solutions to reduce conventional feed grain dependence. Hybrid broilers, which cross white broiler males with layer females, mature rapidly while consuming less feed, offering improved input efficiency for price-sensitive producers. The 2025 approval of new hybrid breeds has bolstered confidence in this segment.

Wheat substitution in poultry feed has gained ground in western China, where Kazakhstani feed flour is cheaper than domestic corn shipments transported from eastern regions. China's zero tariff on feed flour imports, compared with the 65% tariff on wheat outside the TRQ allocation, has facilitated this substitution. The FAS estimates that 35 million tonnes of wheat are now allocated to feed use, reflecting how price dynamics between grains continue to reshape ration formulations.

Outlook: Structural Demand Floor for Global Feed Grains

China's poultry expansion, while moderating in pace, has established a structural demand floor for global feed grains that is unlikely to recede in the near term. The combination of 321 million tonnes of corn consumption, 108 million tonnes of projected soybean imports, and a 290 million tonne feed and residual use baseline creates sustained exposure for international commodity markets.

The tension between Beijing's feed self-sufficiency ambitions and the sheer scale of its livestock sector means that global corn, soybean, and supplementary grain exporters will remain structurally linked to China's production decisions. For commodity traders and agricultural planners, the trajectory of China's poultry sector is no longer a secondary variable. It has become a primary driver of global feed market pricing, trade flow direction, and supply chain risk.