Monday, April 28, 2014 11:08:13 PM
WASHINGTON – China’s decision to effectively halt shipments of U.S. corn is unlikely to cause lasting economic harm to South Dakota and other Midwest corn producers, with farm groups and commodity analysts seeing the trade skirmish as a short-term annoyance for America, the world’s largest corn exporter.
In November, China began turning away shipments of corn from the U.S. containing a genetically modified seed from Syngenta that regulators in Beijing have yet to approve. But there are signs the U.S. agriculture will be able to rebound from the disruption and benefit long-term. That’s because of China’s growing demand for corn used in livestock feed as consumers increase their consumption of proteins such as chicken and pork.
“(China) won’t be able to feed their population on their own long-term, so their dependence on suppliers like us will dictate that they won’t be able to be as picky as they have been,” said Scott VanderWal, South Dakota Farm Bureau president.
The decision to clamp down on shipments of U.S. corn has sparked speculation that China produced a bumper crop of its own, and government officials are using the appearance of the unapproved crop to get out of costly contracts entered into when prices were higher.
Major importer
Government officials in Beijing also have said the country is too reliant on the U.S. for its corn imports. Still, China is on track to become the world’s largest corn importer by the end of the decade.
The trade dispute has highlighted irregularities in the approval process for genetically modified crops, with some countries approving new varieties faster than others. China has approved biotech varieties in the past, but the country’s review process tends to take longer than the U.S. or other proponents of the widely used crops.
Lisa Richardson, executive director with the South Dakota Corn Growers Association, said the trade disruption is a “huge issue” that probably will affect the approval of genetically modified crops.
“It’s not just Syngenta,” she said. “There’s others. All companies have to figure out how we get around this because there are new (biotech) traits getting ready to be released every year.”
Syngenta submitted the corn trait to the government for approval in March 2010, and China had accepted the grain until recently. The Syngenta corn, known as Agrisure Viptera, has been engineered to protect the crop against damage from insects such as corn borer and corn rootworm.
Slow approval
Agriculture Secretary Tom Vilsack met with officials from the Chinese government in December. They discussed ways to synchronize their review of new genetically modified seeds to quicken the approval process, given USDA concerns Vilsack cited last week about the time it takes China to approve new biotechnology traits.
“They don’t start their process until we finish ours. So it lengthens acceptance of the crop for an extended period of time,” Vilsack said.
China has given no indication when or if it will approve the Syngenta seed.
The National Grain and Feed Association estimated this month that Beijing has turned away 1.6 million tons of U.S. corn.
$2.9 billion loss
U.S. agriculture has lost $2.9 billion from the recent disruptions, much of that from lower corn prices. The grain and feed association found the Chinese rejections of U.S. corn have lowered prices by 11 cents a bushel, resulting in a projected loss of $1.14 billion for the last nine months of the marketing year ending Aug. 31.
Bruce Babcock, an Iowa State University economist, said if China produced more corn or found it could buy the grain cheaper from somewhere else, that could signal soft demand for the grain this year.
“That kind of suggests that demand for U.S. corn this upcoming year won’t be as robust as maybe people had hoped,” he said.
The Agriculture Department has said Chinese corn imports are expected to increase from 3 million tons in 2012 to 24.3 million tons by 2023, accounting for 35 percent of the growth in world corn imports during that period.
Babcock said if the expected growth in China’s corn demand holds, U.S. corn-producing states will be ideally positioned to meet the growth. Last year, South Dakota was the sixth-largest corn grower.
“The United States is going to claim a complete dominant role in the corn export market in the future to China,” Babcock said. “If China — and I think it’s likely — is going to be a big importer, there’s not that many places that they can find that corn. They are going to be looking at the United States, first and foremost, from now until 2020.”
Recent ALTO News
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 05/08/2024 08:15:43 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 05/06/2024 08:13:30 PM
- Alto Ingredients, Inc. Reports First Quarter 2024 Results • GlobeNewswire Inc. • 05/06/2024 08:05:21 PM
- Alto Ingredients, Inc. to Release First Quarter 2024 Financial Results on May 6, 2024 • GlobeNewswire Inc. • 04/29/2024 12:30:15 PM
- Alto Ingredients, Inc. Appoints Todd E. Benton as Chief Operating Officer; Michael D. Kandris to Continue to Serve as Director • GlobeNewswire Inc. • 03/21/2024 12:30:49 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 03/11/2024 08:18:04 PM
- Alto Ingredients, Inc. Reports Fourth Quarter and Year-end 2023 Results • GlobeNewswire Inc. • 03/11/2024 08:05:08 PM
- Alto Ingredients, Inc. Enters Letter of Intent with Vault to Advance Carbon Capture and Storage Initiative • GlobeNewswire Inc. • 03/11/2024 08:02:21 PM
- Alto Ingredients, Inc. to Participate in the 36th Annual Roth Conference • GlobeNewswire Inc. • 03/05/2024 01:30:06 PM
- Alto Ingredients, Inc. to Release Fourth Quarter 2023 Financial Results • GlobeNewswire Inc. • 03/04/2024 01:30:24 PM
- Alto Ingredients, Inc. Publishes Sustainability Summary • GlobeNewswire Inc. • 12/11/2023 01:30:04 PM
- Alto Ingredients, Inc. Extends Term Loan Commitment Period • GlobeNewswire Inc. • 12/06/2023 01:30:00 PM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 11/08/2023 09:32:32 PM
- Alto Ingredients, Inc. to Participate in Upcoming Conferences • GlobeNewswire Inc. • 11/08/2023 01:30:00 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 11/06/2023 09:19:10 PM
- Alto Ingredients, Inc. Reports Third Quarter 2023 Results • GlobeNewswire Inc. • 11/06/2023 09:05:29 PM
- Alto Ingredients, Inc. to Release Third Quarter 2023 Financial Results • GlobeNewswire Inc. • 10/30/2023 12:30:00 PM
- Alto Ingredients, Inc. to Present at the LD Micro Main Event XVI • GlobeNewswire Inc. • 09/27/2023 12:30:00 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 09/20/2023 09:20:11 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 09/19/2023 08:05:34 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 09/19/2023 08:05:28 PM
- Alto Ingredients, Inc. to Present at the H.C. Wainwright & Co. 25th Annual Global Investment Conference • GlobeNewswire Inc. • 09/05/2023 12:30:03 PM
- Form 3 - Initial statement of beneficial ownership of securities • Edgar (US Regulatory) • 08/09/2023 08:10:48 PM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 08/08/2023 08:16:45 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 08/07/2023 08:15:54 PM
Last Shot Hydration Drink Announced as Official Sponsor of Red River Athletic Conference • EQLB • Jun 20, 2024 2:38 PM
ATWEC Announces Major Acquisition and Lays Out Strategic Growth Plans • ATWT • Jun 20, 2024 7:09 AM
North Bay Resources Announces Composite Assays of 0.53 and 0.44 Troy Ounces per Ton Gold in Trenches B + C at Fran Gold, British Columbia • NBRI • Jun 18, 2024 9:18 AM
VAYK Assembling New Management Team for $64 Billion Domestic Market • VAYK • Jun 18, 2024 9:00 AM
Fifty 1 Labs, Inc Announces Acquisition of Drago Knives, LLC • CAFI • Jun 18, 2024 8:45 AM
Hydromer Announces Attainment of ISO 13485 Certification • HYDI • Jun 17, 2024 9:22 AM