(Adds analyst quote, updates futures price)
By Mark Weinraub and Karl Plume
CHICAGO, Jan 29 (Reuters) - China booked its biggest purchase of U.S. corn yet, the U.S. Agriculture Department said on Friday, buying more at once than any country except the Soviet Union 30 years ago, as it tries to meet a surge in demand for animal feed.
The purchase, and a string of deals earlier this week, mean China is on course to become the world's largest corn importer.
Its buying spree has driven up global prices of corn and other grains and may stoke food inflation in economies already reeling from the COVID-19 pandemic.
USDA reported private sales of 2.108 million tonnes of corn for delivery to China in the 2020/21 marketing year. It was the second-biggest daily U.S. sale on record, eclipsed only by a deal for 3.72 million tonnes to the USSR in January 1991.
It also topped China's previous biggest U.S. purchase of 1.937 million tonnes in July 2020.
China has been looking to boost corn imports, three industry sources told Reuters in October, after storms and drought damage tightened domestic supplies and as the country's pork industry recovers from a deadly swine disease that reduced the hog herd by nearly half.
"Their hog herd has recovered faster than most had thought possible," said Jack Scoville, analyst with Price Futures Group. "We're making a new highs in futures so it's not like they got a cheap deal. But when your domestic corn prices are north of $10 (a bushel) there's certainly space for purchases."
The latest sale follows deals earlier this week that netted China a combined 3.74 million tonnes of U.S. supplies, closing out what will be one of the largest U.S. corn export sales weeks on record.
Chinese buyers also picked up an additional 132,000 tonnes of soybeans - about two cargoes - for delivery in the 2021/22 marketing year, USDA said on Friday.
The country's corn imports could climb to between 25 million and 27 million tonnes in the current crop year, including 18 to 20 million from the United States, president of AgResource Co, said on Wednesday.
If realized, that would make China the world's biggest corn buyer. In the 2019/20 marketing year, Chinese corn imports totaled just 7.6 million tonnes.
This week's sales bring China's total U.S. corn import commitments for the current marketing year to at least 17.7 million tonnes, above the latest USDA forecast for only 17.5 million tonnes in imports from all suppliers.
The U.S. corn stockpile is large enough to meet the greater demand, analysts said.
The sales follow a steep drop in futures prices last week that opened up a buying opportunity for China, traders and analysts said, though prices rose again this week in response to the purchases.
Chicago Board of Trade corn futures were up 15 cents at $5.49-1/2 a bushel near midday on Friday, approaching the 7-1/2-year high hit on Thursday. (Reporting by Mark Weinraub and Karl Plume; editing by Barbara Lewis)
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The Link LonkJanuary 30, 2021 at 01:14AM
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UPDATE 1-China books biggest deal yet for U.S. corn - Successful Farming
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