April 14, 2014
US grain companies incur US$427 million losses on China''s corn rejection
Since late last year, China has rejected nearly 1.45 million tonnes of US corn shipments, according to the National Grain and Feed Association (NGFA).
The NGFA estimates that China''s rejection of genetically modified corn has cost grains companies US$427 million in lost sales and re-routed shipments.
Following detection of Syngenta''s unapproved MIR162 strain in incoming shipments, China began rejecting cargoes in November last year.
The industry group, which bases its number on data from exporting companies, says exports of corn and related products from the US to China since January are down 85% from the same period last year.
China is the third-largest buyer of US corn and has approved 15 genetically modified corn varieties for import.
Syngenta''s MIR162 has been awaiting approval since an application was submitted in March 2010, although it has been mixed in with other varieties since China started to import US corn in 2011.
According to the report, hundreds of millions of dollars in losses for farmers was the result of the rejections of the Syngenta strand affecting the price of corn and soy on the global market.
Grains companies have been frustrated by what they say is an opaque process of approving and rejecting genetically modified crop strains in the world''s fastest growing corn market.
Soy prices have been under pressure after news on April 10 that Chinese importers have defaulted on at least 500,000 tonnes of US and Brazilian soy cargoes worth around US$300 million, the biggest in a decade, as buyers struggle to get credit amid losses in processing beans.