Brazil should fill US void in supplying soy to China, Chinese state company says

13 February 2007

Sao Paulo, Brazil, 13 Feb – China is expected to increase its imports of Brazilian soy this year, due to lower availability of the product from the US, the world’s largest producer, the director-general of the Brazilian office of Chinese state conglomerate, Chinatex told Macauhub.

Last year Brazil exported 11.6 million tons of soy beans to China, according to figures from Brazil’s Foreign Trade Ministry, which has said soy is the main Brazilian export to the Asian giant. The United States sold 9.8 million tons, according to the US Department of Agriculture (USDA).

A USDA report forecast a reduction of 7.4 percent in the area used for planting soy in the US this year, which will instead by used for maize in order to produce ethanol.

According to Liones Severo, the director of the Brazilian office of Chinatex, the reduction of supply of soy in the US “will have an impact on the world supply of the product, which will lead, amongst other consequences, to greater Chinese demand for Brazilian soy.”

Brazil, which, “has vast areas and availability of land for planting,” could increase its production and meet international demand, “not only that of China,” Severo said.

Argentina, the third largest soy exporter to China, with 6.2 million tons in 2006, according to figures from the Chinese government, may also increase its sales.

However, “Brazilian soy is of better quality and, without doubt, China prefers to buy a higher quality product,” said the Chinatex representative.

Chinatex is the third largest Chinese buyer of Brazilian soy, and bought 1.6 million tons in 2006, and expects to buy 2 million tons this year.

Founded in the 1950s to sell cotton, Chinatex (China National Textiles Import and Export Corporation) now has soy as it main agricultural product and has units in 30 countries. (macauhub)