The Chinese government has suspended issuance of permits to import American-produced animal feed ingredients made from corn, according to three trading executives who talked of the development with Bloomberg BusinessWeek.
The trio, whose applications were denied, said that effective June 6, U.S. shipments of dried distillers’ grains, which are known in the industry as DDGS, can no longer exported into the country because the Chinese government has declared them to have a high risk of contaminating MIR 162, a GMO strain that China hasn’t approved, the executives – who asked not to be identified because they were not permitted to speak to the media – toldBusinessWeek.
The report continued:
China is the largest buyer of the by-product produced when corn is stripped of starch for ethanol production. While U.S. corn shipments into the country plunged amid restrictions on the MIR 162 variety, imports of DDGS continued to rise because some port officials had been lenient, said Sylvia Shi, an analyst at Shanghai JC Intelligence Co.
‘Not a total surprise’
“It looks like the government is determined to stop any form of corn imports from the U.S.,” said Shi, whose company is based in Shanghai.
No one from China’s General Administration of Quality Supervision, Inspection and Quarantine in Beijing commented on the issue, though a spokesman there asked BusinessWeek to fax reporters’ questions to the office.
More than 40 percent of American corn is burned up – used to make ethanol – according to government data. In 2013, China bought 34 percent of U.S. DDGS exports, which was more than twice the share of Mexico, the second-biggest buyer, official numbers say.
BusinessWeek said some 613,678 tons of DDGS imports “were reported by China’s customs in April, a monthly record, according to Shanghai JC data. About 600,000 tons, tested positive for MIR 162, are still held at some ports and may be returned, according to the Chinese researcher.”
A separate report by the group GMO Watch said China’s decision was not unexpected.
“This development did not come as a total surprise, following as it did China’s recent rejection of 1.1 million metric tons of Syngenta corn containing the unapproved GMO strain MIR162,” the group said. “Official news said that though Syngenta has repeatedly submitted the Lepidoptera-resistant GM cornfor review and import into China, the documenting information and experimental data were incomplete and problematic. Thus the corn is still under assessment and has not been approved for import.”
A ‘win-win’ in the long run
GMO Watch said that, according to an official Chinese website, The People, the first return of genetically modified DDGS occurred December 23, 2013, when 758 megatons were turned back in Shanghai Port, in eastern China. In order to prevent another shipment, China’s quarantine agency immediately informed the relevant authorities in the United States about the decision, and urged them to tighten up the pre-export checks in order to ensure that future DDGS exports to the country conform to Chinese regulation and safety standards.
On 26 December 2013, China’s media reported that a total of 2,000 MT [of] unapproved GM DDGS had been rejected by Chinese quarantine officials, GMO Watch noted. The agency “then said they would conduct nationwide strict inspection of unapproved GM varieties, including GM DDGS.” “The Peoplealso reported that currently there are 250,000 metric tons of GM DDGS to be returned that have been accumulated in coastal port warehouses in the first half of this year.”
The group says that, in the long run, Chinese analysts see a win-win. While short-term loss of DDGS supplies will be a hardship, in the longer term they believe U.S. farmers will have to begin producing more non-GMO corn, in order to comply with China’s import standards.