Stricter procedure for US soyabean exports to China take effect
January 04, 2018
A stricter export procedure for US bulk and container shipments of raw, unprocessed soybeans to China took effect on 1 January.
The new procedure to comply with China’s phytosanitary import requirements will involve the US Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) notifying China when a soybean shipment exceeds 1% foreign material by placing an additional declaration on the phytosanitary certificate that says ‘this consignment exceeds 1% foreign material’.
It has been put in place following concerns raised by China in September about foreign material exceeding Chinese standards as well as weed seeds of quarantine concern.
According to World Grain, Chinese officials have assured the USA that the new procedure would allow all US soybean exports to China, including those with more than 1% foreign material, to continue without interruption until the USA was able to fully implement a series of science-based measures from farm to export terminal.
However, the new rules could require additional processing of US soyabeans at Chinese ports to remove impurities, raising costs and reducing sales, a Reuters report on 27 December said.
Half of the 473 vessel shipments and half of the total 27.5M tonnes of US soybeans exported to China in 2017 contained more than 1% foreign material, according to USDA data compiled by grain broker McDonald Pelz Global Commodities LLC, the report said.
Former chairman of the American Soybean Association Richard Wilkins said growers often received a higher price for selling soybeans with 1% or less foreign material, known as No 1 grade, because importers paid more for better quality.
The change would deliver higher-grade soyabeans to Chinese buyers without requiring a premium price, he claimed.
However, Osama El-Lissy, a deputy administrator at the USDA, said in the Reuters report that farmers should not face additional burdens under the new standards.
“Nothing in the agreement we have with China would lead anyone to believe that there would be a change in whatever price arrangement (is) currently being agreed to.”
He said some Chinese buyers may already apply additional processing to soya shipments. “Whatever time it’s taking now is likely to be the same amount of time that would apply post 1 January.”
Reuters said that China accounted for roughly two-thirds of global soyabean imports, totalling about 86M tonnes, chiefly from Argentina, Brazil and the USA. Argentina and Brazil were not covered by the same agreement as the USA, it added.