February 17, 2004

China May Start Exporting Corn in Late March

China may start exporting corn in late March but sales for the first half of the year will be less than 1.5 million tonnes, Jilin Grain Group (JGG) said on Tuesday.

"Maybe at the end of March shipments will begin...But we have not yet offered (any corn for exports) officially," an official at JGG, one of the country's two authorised corn exporters, said.

The international grain market has been waiting for China to clarify its corn export policy for the year, and traders had expected it to issue export quotas before the end of this month.

The JGG official said Beijing was likely to issue export quotas only for the first half, unlike in the past when it issued quotas for subsidised corn exports for the entire year at the start of year.

China exported a record 16.4 million tonnes of corn in 2003, up 40.4 percent from the previous year. Malaysia and Indonesia were among the top buyers.

Asked about export prices, the JGG official said: "Our target is to reach the same prices as U.S. corn...Japan is our main destination because they pay high prices."

The official would not comment on the fate of subsidies. The market has expected Beijing to scrap all financial aid for the exports, except for rebate of the 13-percent value added tax.

On Monday, South Korean feed-makers bought 163,000 tonnes of corn of mostly optional origins for arrivals between March and April. The prices were $184-$185 per tonne C&F if from the United States or South America and at $174-$185 if from China.