China, the second-largest corn user, may buy 4 million metric tons in year ending Sept. 30, according to the China National Grain & Oils Information Center. The country purchased 1.75 million tons in 2011, customs data show. Drought in Argentina will limit its ability to supply grain this year, said Li Qiang, managing director, Shanghai JC Intelligence Co.
Growing cities and rising incomes may almost double China’s corn imports to a record 7 million tons in 2012-2013, Rabobank International said Dec. 5. The agreement, after years of negotiations, would give corn from Argentina access to China for the first time in more than 10 years, said Li from Shanghai.
The accord “is good for China’s long-term trade paradigm, as it gives China an alternative supplier,” said Li.
Trade relations deteriorated in 2010 when China, irked by antidumping charges on products ranging from steel pipes to kitchen equipment, ordered traders to stop buying soybean oil from Argentina, the biggest supplier.
Relations warmed after exchanges including a trip by President Cristina Fernandez de Kirchner to Beijing and visits to Buenos Aires by Chinese ministers. Argentine Vice Minister of Agriculture Lorenzo Basso said in November he expected China to issue a quarantine permit of plant health in a month.
The U.S. Department of Agriculture cut Argentina’s corn export forecast by 4.5 million tons to 14 million tons on Feb. 9, and said output may drop by 4 million tons to 22 million tons.
China last year harvested a record amount of corn and the supply has weighed on domestic prices, the China National Grain & Oils Information Center said yesterday.
--Dale Crofts, William Bi. Editors: Richard Dobson, James Poole
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