March 29, 2004

China Resumed Corn Exports In Early March

China National Cereals, Oils and Foodstuffs Import and Export Corp., or Cofco, resumed corn exports in early March, after the government issued an export target of 1.4 million metric tons in late February, a company official said Monday.
 
China's corn exports ground to a halt late last year, after the previous corn export quota was used up.
 
Although the government claims exporters are able to export corn any time, it issues an export target for corn every few months, in an attempt to balance domestic demand and supply as well as maintain China's market share in Southeast Asia.
 
Cofco, along with Jilin Grain Group, are the two companies authorized by the Chinese government to export corn. Jilin Grain Group hasn't exported corn so far this year.
 
"We sold most of the 1.4 million tons of (corn) exports planned by the government in early March... In fact, the ships have been loaded and are heading for their destinations," said an official at Cofco's maize department in Beijing.
 
A small volume of the of 1.4-million-ton export quota was allocated to JGG.
 
Neither Cofco or JGG officials would disclose the exact volume of the quota they received.
 
The Cofco official said the company's buyers were from Southeast Asia, including Japan, South Korea, Malaysia and Indonesia.
 
"We don't mind who the buyer is...We care about who's willing to accept higher prices," said the official, adding that the highest price Cofco offered to overseas buyers in March was at $200 a metric ton, free on board.
 
In comparison, an exporting official at JGG foresaw their offer around $180/ton FOB, if JGG successfully resumes corn exports by the end of March.
 
The current export price for corn is up sharply from $105/ton, FOB, in the same period last year. Officials of the two companies said this was a result of tight supply in the domestic market.
 
The officials predicted the government would announce the next export target for corn later this year.
 
But they don't expect the government to allow this year's corn exports to rise from 2003, as much of the supply will be sold domestically, owing to strong demand.
 
According to figures released by Chinese customs, China's corn exports totaled 16.4 million tons in 2003, up 40% on year.