July 15, 2005

China's GM corn import baffles grain experts
 

China's decision last week to approved imports of Monsanto GM corn NK603 has got grain analysts puzzled, as China always had a surplus of corn.

Currently, China not only imports very little corn, it is traditionally an exporter of corn, a UK-based dry bulk analyst said.

The country's corn production last year is high at 130 million tonnes, while this year's expected production is 128 million tonnes. China also has extensive stocks of corn.

China has been exporting more corn in the past 12 months than expected. In fact, corn exports for the first four months this year have hit 2.3 million tonnes, which is already the total export amount in 2004.

As such, there is no actual need for China to approve the import of US GM corn.

According to an International Grains Council (IGC) grain market report, China may be importing corn in 2005/06 to meet increasing domestic demand, thus maintaining stocks while keeping market prices in check.

Analysts also point out that the Chinese statistic may be unreliable and the decision by the government could be indicative of its plans to import corn soon.

Another possible reason for the approval of US GM corn imports could stem from demand in local animal feed production, which requires corn qualities inherent in GM corn.

According to the IGC, China is likely to import 100,000 tonnes of corn this year from sources such as the EU, Argentina and the US.