February 18, 2004



China Ready To Buy More US Wheat


China has plans to import more wheat from the United States, the chairman of a Chinese state trading enterprise said on Tuesday.


The purchase will largely depend on prices, quality and local wheat supplies.


Without providing any details on the scope of future purchases, Zhou Mingchen, chairman of China's COFCO, told reporters in Washington that his firm would not switch already contracted 2003/04 purchases to 2004/05, as has been speculated by some U.S. commodity traders.


"We hope U.S. wheat will be more competitive so we can consider purchasing more in the future," Zhou said through an interpreter at the start of a visit to the United States aimed at completing shipping and other details for about 2 million tonnes of American wheat already contracted.


Zhou made his remarks at the start of a week-long visit to the United States with other COFCO officials that includes stops in Chicago, Illinois, and Portland, Oregon.


COFCO's visit was originally planned for late last year, but was delayed after the Bush administration announced new trade barriers to some Chinese textiles.


At a breakfast with a small group of reporters before meeting with U.S. Agriculture Undersecretary J.B. Penn, Zhou complained about ocean freight rates from New Orleans, which he said have risen "drastically."


Zhou added that officials of COFCO, the China National Cereals, Oils and Foodstuffs Import and Export Corp., will use their trip to Portland to "look at varieties and prices" of Pacific Northwest wheat.


It was not clear from Zhou's remarks whether potential Chinese purchases of Pacific Northwest wheat would be part of existing sales agreements or future ones.


As for China's overall need for more American wheat in coming months, Zhou said there would be "further negotiations" and there "can be more than the number (already contracted) or less than the number. It all depends on concrete terms."

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