The United States, the world’s top grain exporter, will feel little impact should China end its one-year hiatus on corn and wheat exports, said traders Dec. 31.
China is expected to authorize exports of 500,000 tonnes of corn and 500,000 tonnes of wheat in 2009, which would barely put it among the top 10 exporters for either grain, according to rankings by the U. S. Agriculture Department.
The U. S. is expected to export more than 45 million tonnes of corn in 2008-09.
“If that’s all they are going to do, the impact should be minimal,” said Citigroup analyst Mario Balletto. “The amounts aren’t going to be significant and their corn is really not competitive (on price) right now. The chances are not all that great that they are going to further step up exports.”
China has always been a wild card for the corn export market, switching periodically from the world’s second-largest exporter to a significant importer. It is more consistently a minor wheat exporter: USDA expects China to export two million tonnes of wheat in 2008-09.
China usually exports corn only with government subsidies and tax rebates because corn prices in China are higher than in many other countries.
China is likely to relax export restrictions following a record all-grains harvest of 528.5 million tonnes, up 5.4 per cent from 2007.
Beijing is already supporting domestic prices by buying up to 30 million tonnes of corn for domestic reserves.
In 2007, China exported 4.9 million tonnes of corn, putting it in third place behind Argentina. China exported 2.33 million tonnes of wheat in 2007.