By Karl Plume
Nov 18 (Reuters) - China, one of the world’s largest corn importers, rejected a cargo of U.S. corn because it contained a genetically modified variety that is not approved for import, a trade source said on Monday.
The shipment contained Syngenta AG’s Agrisure Viptera corn, also known as MIR 162, the source said.
“It’s confirmed. It’s one cargo and MIR 162 was the problem,” said the source, who asked not to be identified.
The GMO discovery comes at a time of surging U.S. corn imports by China as Beijing grapples with record-high domestic corn prices and rising demand for food. For that reason, analysts say the matter will be quickly resolved.
“It is a minor hiccup in what will otherwise be a smooth import process. They need our corn, they’ve got the orders already placed. We don’t think this is the start of some long-term major disruption,” said Rich Nelson, chief strategist with Allendale, Inc, an Illinois-based research and analytical firm.
Even so, the news weighed on the Chicago Board of Trade corn futures markets. December corn futures fell 10 cents, or 2.4 percent, to a three-year low at $4.12 per bushel.
The United States historically is the world’s top supplier of corn, exporting between 10 and 20 percent of its harvest each year. The U.S. Department of Agriculture estimates that farmers will export 10 percent of this year’s corn crop, now estimated at a record 13.989 billion bushels.
China is the third largest corn importer after shifting from a corn exporter to a net importer in 2010, buying nearly all of its imports from the United States.
China has not yet signed off on MIR 162 but is expected to approve it later this year or in 2014, according to traders. It is approved for import by other U.S. trading partners, including Mexico, the European Union and top corn importer Japan.
Agrisure Viptera, designed to offer enhanced protection against crop-damaging insects, is widely grown in the United States so traces of the grain may have been commingled with approved corn strains in a shipment to China, traders said.
“Syngenta is not aware of any such incident,” said Paul Minehart, head of Corporate Communications-North America for Syngenta Corporation.
China already allows imports of 25 different GMO corn varieties and is considering adding other commonly cultivated varieties to the list, including Agrisure Viptera, which has been pending approval for about 18 months.
The discovery of MIR 162 in a single cargo from its top supplier was unlikely to disrupt the flow of U.S. corn to China.
A bulk corn shipment from Argentina was cleared for import earlier this year despite it containing traces of MIR 162.
China is expected to import a record-high 7 million tonnes of corn in the 2013/14 (Sept/Aug) marketing year, according to the USDA.