CHICAGO, Jan 7 (Reuters) - An increasing amount of distiller’s dried grain (DDG), a popular corn-based feed grain, is passing Chinese quarantine inspections after state officials rejected some imports containing an unapproved genetically modified (GMO) corn strain, according to Chinese market analyst JC Intelligence Co.
“The situation seems to have improved these days and inspection turns regular,” JCI told clients in a letter seen by Reuters on Tuesday. “Last week, there was 20-25 percent of imported DDGs passing the customs inspection and the passing rate has increased to 40-50 percent this week,” said the Shanghai-based analyst firm, widely followed by the U.S. grain trade for China market trends.
“Market insiders expect the customs clearance rate will further rise to 60-70 percent next week,” JCI said.
Beijing has rejected about 2,000 tonnes of U.S.-produced DDGs as well as 600,000 tonnes of U.S. corn shipments since November after samples in the cargoes were found to contain traces of Syngenta’s AG’s MIR 162 corn, a GMO variety that has been awaiting China’s official approval for more than two years.
A signal that China’s grain inspections approvals were improving came on Monday when the price of U.S. distiller’s dried grain - a high protein feed that competes with soymeal in livestock rations - jumped $10 per ton or 5 percent or more, at export markets, rebounding from steep declines that occurred during December in nervous reaction to China’s posture.
Traders said the December price drops of up to 20 percent in DDGs had spurred fresh domestic and export interest - including from China. Barges of DDG shipped in the first three months of the year on the Mississippi River continued to rise on Tuesday, bid at $205 per ton, up from $180 last week but down from $275 in early December, traders said.
JCI’s letter also reported that the Chinese grain inspection authorities in Guangdong and Shanghai are meeting with industry participants this week to discuss the inspection process.