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ECONOMY | 02-07-2024 15:50

Argentina poised for first China corn cargoes in 15 years

Argentina is preparing corn shipments to China that will be the first in 15 years, the latest move by the two countries to expand agricultural trade.

Argentina is preparing corn shipments to China that will be the first in 15 years, the latest move by the two countries to expand agricultural trade.

Cargoes that Cofco International Ltd has been putting together could be the first since China re-opened its doors to Argentine corn following drawn-out diplomatic talks, said Gustavo Idigoras, head of CIARA-CEC, a national crop-export group whose members include the major agricultural trading houses.

Argentina completed steps a few weeks ago to get approval from Beijing to open the Chinese market for its corn, after striking an agreement on sanitary requirements last year. Argentina’s corn harvest is in full swing, with 55 percent of the crop collected through June 26.

Corn shipments to China would show that the two countries are likely to maintain a robust trade relationship under the leadership of Javier Milei, who once vowed to curb ties with Beijing if he became Argentina’s president. He took office in December. Chinese trade and investment drive swathes of Argentina’s economy, ranging from commodities and energy to banking.

In January, Chinese customs authorities also authorised traders in Argentina to export wheat for the first time.

China is the world’s biggest importer of corn for livestock herds. Traditionally, the Asian giant has sourced the grain from the US, but has increasingly turned to Brazil after giving the green light for supplies from the country in 2022. 

China’s farmers are continuing to grapple with extreme weather from flooding to drought, threatening crops including corn and placing pressure on the nation’s leaders who are promoting food security. Dry conditions in the north have damaged the wheat harvest, and delayed planting of corn and soybeans.

Syngenta AG has chartered the MSXT Echo tanker to send 66,000 metric tons of soybeans to China, one of several routine Argentine soy shipments to Asia. A ports line-up published by the NABSA shipping agency earlier incorrectly listed the cargo as corn.

by Jonathan Gilbert, Bloomberg

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