Corn harvested in Liaocheng. (Photo : Getty Images)
China approves the export of around 2 million tons of corn, trading sources, who are unauthorized to speak to the media, said on Friday.
Cofco and Beidahuang, two of the companies who received permits from the Chinese government, are set to have bulk exports, reducing enormous corn stockpiles in China and soaking the global market.
Saying that the permits were not their responsibility, a representative from China's commerce ministry pointed the National Development and Reform Commission, who refused to comment. There were also no comments from the two state-owned companies.
However, traders and analysts said that there is a high probability for export given the overproduction of corn in the country. China is one of the world's biggest producer with a yield of 220 million metric tons of corn per year.
If it would push through, this would be a comeback for China who last exported corn in 2007. Since then it became an importer after a state stockpiling scheme pushed domestic prices way above the global market, stoking purchases of cheaper grain from overseas.
With its probable entry in the world market, China may increase competition among major exporters including the United States and Brazil.
Corn has been the top crop in China, not because Chinese have a big appetite for it, but it is used to grow livestock. A National Geographic report in 2015 said that 60 percent of China's corn goes to feeding animals, 30 percent goes to the manufacturing industry such as alcohols, sweeteners and chemicals, and only 10 percent is consumed by the people.
