December 22, 2006

China to restrict corn exports from next March

In early November, China's Developing and Reform Committee gave notice to the China grains Group and Jilin grains Group to suspend new export orders after the end of February.

After the financial crisis in south-east Asia, China implemented policies to encouraging corn export, including subsidies for grain export at RMB 140/tonne, with a tax-rebate at 13 percent or RMB143/tonne, based on a benchmark of RMB1,100/tonne.

The corn export subsidy was canceled this October. In addition, a rumor was circulated in the market, saying that China's government would auction its corn reserves.