Chinese agri-giant Cofco has announced that there will
be no more new ethanol projects in the near future as Beijing was concerned
about possible grain shortages.
Additionally, China will halt most grain exports this year, apart from a
small amount to selected destinations, such as Hong Kong and Taiwan, said Cofco
chairman Frank Ning.
He confirmed market expectations that China would no longer export grains,
including corn or wheat, as Beijing tries to avoid imports in the face of
sky-rocketing grain prices and declining global stocks.
Ning also stated that due to the high price of foreign grains, China would
not import for the time being. He added that China did not have any supply
problem for corn this year as many corn processing plants had already closed
down due to high grains prices.
Soybeans the biggest problem
"The biggest problem for China is soybeans: we cannot produce enough. It
would require a lot of land. We don't have so much land. Imports will continue
to grow," he said, without any indication import figures. China is already the
world's top soy importer, accounting for about a half of global trade.
When asked about new ethanol projects, Ning stated that "unless we could
find other raw materials to use, all will be stopped".
Sweet potato or sweet sorghum plant
China Agri said in January that it was trying to acquire a licence to add a
plant in Hebei, Hubei or another province, which would use sweet potato or sweet
sorghum as raw material.
"There are still arguments on using sweet sorghum or sweet potatoes (for
ethanol). These raw materials might still take away farmland for producing
grains," he said.