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Field Crops & Forest Products

USGC Work In China For U.S. DDGS

06/26/2015

 

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Using Market Access Funds (MAP) funds in 2014, the Council was successful in defending U.S. exports of Distillers Dried Grains with Solubles (DDGS) exports to China in Calendar Year (CY) 2014. China is the number one export market for U.S. DDGS importing 4.4 million metric tons, valued at $1.3 billion in CY 2013. However due to a number of internal political reasons, the Chinese government used a variety of technical barriers in an attempt to shutdown U.S. DDGS exports to China in CY 2014. The primary barrier centered on the lack of approval of the corn biotechnology trait, MIR 162 by the Chinese government. In addition, the Chinese government policy focus on self-sufficiency has created large stocks of high priced local corn. The Chinese government was interested in restricting any feed imports which would compete with local corn usage, even if it was cheaper and better quality. The Council work in coordination with the U.S. Department of Agriculture, U.S exporters, Chinese importers and the Chinese livestock industry to build a coordinated coalition to address Chinese governmental roadblocks to DDGS imports. In addition, the Council held regular meeting with Chinese governmental authorities to address their concerns regarding DDGS imports. Despite a year of turmoil and dramatic market swings (closure and opening of the market), the Council’s efforts helped to ensure that the Chinese market remained the number one importer of U.S. DDGS in CY 2014, importing over 4.3 million metric tons of U.S. DDGS, valued at $1.24 billion. In 2014, the Council invested $200,000 of MAP funding to promote and defend U.S. DDGS exports to China. As a result, export sales of U.S. DDGS totaling over $1.24 billion generating a Return on Investment (ROI) of $6,200 per $1 of MAP funding invested.