Ethanol Blog

After the long-awaited approval of the Agrisure Vipetera (MIR 162) biotech corn trait, news sources are reporting that China is actively looking to purchase shipments of U.S. dried distillers grain.

China's reluctance to accept the trait developed by Syngenta caused massive trade disruptions in 2014, shutting down exports of DDG to China for many months. Rumors that China would accept the MIR 162 trait circulated in early December. Finally, on Dec. 22, Syngenta received the official certificate from Chinese authorities that formally granted approval for imports of corn and DDG containing the trait. The trait has been approved in 19 countries including the U.S. since 2010.

U.S. suppliers have reported receiving inquiries from China, but seem to be keeping the past year in mind and are protecting themselves. While down payments protecting against possible government rejections have been rare, because of China's history of rejecting DDG and corn with the MIR 162 trait, several U.S. traders are reportedly now requiring large down payments on all shipments to China.

Inquiries and purchases of as much as 900,000 metric tons of DDGs had occurred before the official acceptance documentation arrived, a sign that the approval was soon to come. However, that renewed interest lead to a sharp rally in prices in late December. The DTN weekly DDG spot price average has risen $76 per ton in the past 11 weeks, $49 of that just since the first week of December.

Cheryl Anderson can be reached at Cheryl.anderson@dtn.com.

(ES)

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