Nov 04, 2022
Brazilian Corn Exports to China to Begin by End of 2022
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
China and Brazil have agreed to terms on phytosanitary standards for Brazilian corn to be exported to China. While the final agreement was announced a few months ago, the process was set in motion in 2014, but very little Brazilian corn moved to China due to the complex inspection requirements demanded by China.
Those demands quickly evaporated a few months after the start of the war between Russia and Ukraine. China depends on the United States and Ukraine for most of its corn imports, but once Ukraine's corn exports were disrupted by the war, China immediately went looking for alternative supplies of corn besides the U.S. and Brazil was the logical choice.
Brazilian and Chinese officials quickly agreed in May on phytosanitary standards allowing Brazilian corn exports to China. Just recently, China approved 136 Brazilian gain facilities to export corn to China and more are expected in the coming weeks. Approved facilities include those of Archer-Daniels-Midland Co., Bunge Ltd., Cargill, Louis Dreyfus Co., and Cofco International.
Brazil may export only a limited amount of corn to China by the end of 2022, but larger amounts will start in early 2023 when Brazilian farmers harvest their first corn crop starting in January. The volume of exports are expected to increase significantly when Brazilian farmers harvest their safrinha corn next June-July-August. The safrinha corn accounts for approximately three quarters of Brazil's total corn production.
Spain and Egypt are the traditional destinations for Brazilian corn, but once Brazil starts exporting corn to China, those two countries may look more to the U.S. for their corn supplies.
Brazil and China have also agreed on phytosanitary standards for the export of Brazilian soybean meal to China for the first time. Brazil has sent to China a list of potential soybean meal facilities for their approval, but Chinese officials have not yet responded.
The amount of commerce between Brazil and China continues to increase, but it is not just agricultural goods, Brazil is the major supplier of iron ore to China as well.