China, Argentina corn exports rising

Cattle Market & Farm Reports, Editorials
Feb 7, 2005
by WLJ
China expects to export double the corn crop it did last year, while Argentina appears on pace to raise its exportable corn harvest slightly.
Corn exports from China will experience a partial revival this year with the government considering more policies to boost overseas sales, state media reports, citing an expert at the National Grain and Oils Information Center.
Exports of corn from China are forecast to more than double to 5 million metric tons in the marketing year ending September 2005, the China Daily reports, citing forecasts by an unnamed expert at the center.
The center predicts that China's corn output will rise 14 percent to 131.7 million metric tons in 2005, due to a 6 percent expansion in the area sown with crops to 25.6 million hectares.
In 2004, China exported 2.32 million tons of corn, a dramatic slump from the 16.4 million tons exported in the previous year. But that decline was blamed on a delay by the government in issuing export quotas until after the end of the 2004 marketing year.
To revive exports in 2005, the government may introduce measures such as increasing export quotas and waiving railway construction funds for the transportation of corn, the newspaper reported, citing the expert at the grain and oilseeds center.
Exempting corn from the rail construction levy would help lower delivery costs from production bases to ports by 30 percent, the expert said.
China already pays an export rebate to corn producers, but the refund is calculated at a fixed price for grain, which is usually lower than the actual free-on-board rate.
Under the World Trade Organization rules, China can also directly subsidize farmers up to 8.5 percent of the country's total agricultural production.
Argentina's farmers have planted 99.9 percent of the 2004-05 corn crop, the Buenos Aires Cereals Exchange said Feb. 1.
Farmers will begin collecting the 2004-05 harvest, which is expected to total 17.9 million metric tons, in February.
The exchange sees the planted area of exportable corn at 2.58 million hectares. Last year area totaled 2.28 million hectares. As of Jan. 29, farmers had planted 2,556,300 hectares.
The average yield will total 7 tons per hectare this year, the exchange has said.
Yields have risen steadily over the past decade, according to exchange data. In 1993-94, the average yield totaled just 4.2 tons/hectare. Yields are rising as farmers become better at rotating crops and applying agri-chemicals like fertilizer and herbicide, among other things.
In addition, last year farmers in some areas began planting a new kind of genetically modified corn seed made by Monsanto. This is expected to boost output by allowing farmers to plant the crop in areas that are not typically apt for good growth.
In some areas, yields are even expected to total 10 tons/hectare, the exchange has said.
Last year Argentina produced 13.1 million metric tons of corn, according to the exchange.
The U.S. Department of Agriculture has forecast Argentina's 2004-05 output at 17 million tons while the Agriculture Secretariat has put it at between 18 million and 19 million. — WLJ