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MOFCOM extends anti-dumping probe

12-29-2011 14:38 BJT

The Ministry of Commerce (MOFCOM) said yesterday that it would extend an anti-dumping probe on imports of US distillers' dried grain (DDG) until June 28, 2012 before making a final ruling.

The ministry said it had decided to extend the probe for six months as the case was "special and complicated." The investigation was launched a year ago, at the request of four Chinese ethanol producers, including COFCO Biochemical Anhui Co and Jilin Fuel Alcohol Co.

The reason for the probe is that imported DDG has hurt domestic producers, a member of staff at COFCO's biochemical energy unit who wished to remain anonymous, told the Global Times yesterday.

DDG, a byproduct of corn-based ethanol production, is used as a substitute for corn in livestock and poultry feed. China produced 3.5 million tons of DDG in 2010.

Imports of DDG in 2010, mostly from the US, jumped 385 percent year-on-year to 3.16 million tons, due to a reduced corn yield in China last year and relatively low prices of DDG from the US, Wang Xiaoyue, an analyst with Beijing Orient Agribusiness Consultant Ltd, told the Global Times yesterday.

Corn processing enterprises were greatly affected by the influx of US DDG, and the investigation was launched for the purpose of regulating the industry, Jiao Shanwei, editor-in-chief of cngrain.com, a Zhengzhou-based grain portal, told the Global Times yesterday.

"Also, DDG from the US is made from genetically modified corn, the impact of which on people's health is still uncertain, so it's necessary to control the imports," said Jiao.

Total DDG imports in the first 11 months of this year fell by 48 percent year-on-year to 1.5 million tons.

With the domestic corn supply recovering, extension of the probe will not have a big impact on the feed industry, said Jiao.

The yield from China's corn harvest increased by 8 percent year-on-year in 2011 to 192 million tons, with 1.18 million tons imported in the first 11 months.

However, feed mills in China have been less happy about the probe than producers, because the imported DDG is both of higher quality and less expensive, so it can reduce costs, said Wang Xiaoyue.

Wang also pointed out that the probe has driven up byproduct prices since last December and hence pushed meat prices higher as well.

Liu Yonghao, chairman of New Hope Group, a leading domestic feed company, appealed earlier this year for the probe to be called off, saying that it does not take the interests of China's feed industry into consideration.

 

Editor:Wang Xi |Source: Global Times

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