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Grain Buyers Looking to Import Crops
USAgNet - 11/23/2016

A surge in Chinese corn prices after the government clamped down on the overloading of trucks has boosted demand for cheaper feed grains such as sorghum and barley from the top exporters, which are the US and Australia. The Chinese central government launched a nationwide crackdown on overloading in late September, hitting supplies of corn, which must usually be transported around the country from northern growing regions, reports Reuters.

Chinese corn prices have climbed 16 percent since the start of October, also supported after the government introduced subsidies for corn processors and as wet weather slowed the latest harvest.

That has provided an unexpected boost to overseas suppliers of grains that can be used as alternatives to corn in animal feed, with traders reporting an uptick in shipments of sorghum from the US and barley from Australia.

The government wants to stamp out overloading to curb damage to roads and reduce accidents. The central government has also been giving priority to coal freight on its railways amid surging prices for the fuel as winter starts to bite, according to energy market participants.

US sorghum shipped to southern China currently costs around $240 per ton, said traders and analysts, compared with domestic corn arriving at Shenzhen's Shekou Port for 2,040 yuan per ton. Feed barley is about 1,500 yuan per ton.

China has booked more than 20 vessels of US sorghum since late October for arrival by February, said a trader in China, declining to be identified as he was not authorized to speak with the media. That would amount to more than 1 million tons.

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