China to lift ban on imports of GM corn

China has rejected over 1.2 million tons of US corn cargoes since last year because they contain MIR 162. Photo / Thinkstock

China's government has told traders and officials that the Ministry of Agriculture approved lifting a ban on imports of a genetically-modified corn variety that's commonly grown in the US, as trade talks between the two countries begin on Tuesday, said people familiar with the matter.

The approval covers imports of the MIR 162 corn variety developed by Syngenta, according to people who were notified verbally by officials at the ministry. They asked not to be identified because information hasn't been made public.

"The move, if it materialises, will be a boost for China's imports of US corn," said Li Qiang, managing director and founder of Shanghai JC Intelligence, an agriculture industry consultant. It would also be "a sign confirming the improving relationship between the two countries," he said.

The easing of curbs on US corn exports to its largest market for food and agricultural products comes as China's government, the world's most-populous country and the biggest consumer of rice, soybeans and wheat, pushes forward with a campaign to gain public acceptance of genetically modified organisms and seeks to expand food supplies.

China's corn imports will fall to a four-year low of 2 million tons in the year through September 2015, according to forecasts by the US Department of Agriculture. They could double to 4 million tons if the import ban is lifted, according to Li at Shanghai JC Intelligence.

The country has rejected over 1.2 million tons of US corn cargoes since last year because they contain MIR 162, according to an estimate by the consultant.

Photo / Thinkstock

Shipments to China of US corn and corn-derived feed ingredients known as dried distillers grain have been disrupted as more than 10 per cent of the US crop comes from seeds containing the gene, making it difficult to guarantee any cargo is free of the trait, according to Meng Jinhui, an analyst at Cofco Futures, unit of state-owned Cofco, the country's largest grain trader.

The Ministry of Agriculture didn't immediately respond to a faxed request for comment. Calls to the US Embassy in Beijing weren't answered. Agricultural quarantine and inspection is one of the priorities at the US-China Joint Commission on Commerce and Trade that starts on Tuesday in Chicago, Shen Danyang, spokesman at the Ministry of Commerce, said on Tuesday in a press briefing.

Corn futures have fallen 3.9 per cent this year on the Chicago Board of Trade. On the Dalian Commodity Exchange, the contract for May delivery closed at 2,394 yuan a ton ($9.84 a bushel), up about 2.4 per cent this year.

- Bloomberg