ABRAMILHO: Brazil to increase corn exports to China

According to ABRAMILHO (the Brazilian association of corn producers), Brazil and China are in negotiations to expand the corn trade between countries, although it is not feasible to increase exports to the Asian country at this time due to reduced supply in the off-season.

Government data shows that only a fraction of Brazil’s corn sales, equivalent to 68,550 tons, went to China last year. In the period, 42.7 million tons of cereals were exported. As a comparison, China acquired almost 80% of Brazilian soy last year, 58 million tons.

On Tuesday, Bloomberg reported that Brazil was approaching an agreement that would allow the country to increase sales of the cereal to China, which depends on the Brazilian product to feed its growing pig herd.

According to the President of ABRAMILHO, Cesario Ramalho, representatives of the entity participated in a meeting two months ago with importers and Chinese authorities to discuss the corn trade. The Ministry of Agriculture told the Chinese representatives at the time that it would endeavor to take measures that would allow Brazil to increase corn exports to China.

“We don’t have to run out selling; we don’t have corn to sell,” said Ramalho. “People go crazy that China wants to buy, but thank God, there are multiple buyers of corn such as Japan, Iran, the European Union; there are many corn buyers,” he added.

See the graphs below for volumes of corn exported by Brazil since 2017 and the main destinations:

Brazilian Corn Exports (1005) | Jan 2017 to Oct 2020 | WTMT

Source: DataLiner

Main Destinations for Brazilian Corn Exports (HS 1006) | Jan-Dec 2019 | WTMT

Source: DataLiner (To request a DataLiner demo click here)

The Ministry of Agriculture did not immediately respond to a request for comment. ANEC (the national association of cereal exporters) declined to comment.

ABRAMILHO said that the measures to facilitate grain trade with China would be relatively simple to implement, explaining that the Chinese are concerned about a certain type of weed that could be eliminated through the use of herbicides.

Brazil plants two large corn crops a year and is expected to harvest a total of more than 102 million tons this season, according to government estimates. Most of the production is available from mid-year when farmers harvest the second harvest.

Source: Reuters

Sharing is caring!