Grain Mission participants meet with key customers in China, the Philippines

Farm Forum

Eleven U.S. farmers learned firsthand about their customers’ perspectives in China and the Philippines during the U.S. Grains Council’s (USGC) Grain Export Mission (GEM) held recently, leaving them with clearer understandings of the challenges, opportunities and competition U.S. grains face in these critical markets.

Members of the group saw the Council’s local efforts in both countries during visits to ports, feedmills, trading houses, dairies and more. They also had the opportunity to share updates on U.S. crop production, including insights into their 2016 planting decisions, during symposia with customers and end-users.

The GEM journey started in China, the world’s second largest corn producer and consumer; the top market last year for U.S. sorghum and distiller’s dried grains with solubles (DDGS); and a major feed barley importer.

While China has the potential to become the world’s largest importer of corn, its policies and regulations offer uncertainty about its future purchases. Corn imports are restricted not only by a tariff-rate quota but also by recent rejections due to unapproved biotech traits. Policy shifts have generated import demand for DDGS, sorghum and feed barley, which are generally more freely imported than corn.

“Building trust and partnerships in agricultural trade is part of how the Council is working in China to create more stable demand,” said USGC Director in China Bryan Lohmar. “Since 1981, the Council has worked in China to find solutions to the challenges of food security through development and trade. These programs continue today, with efforts like the GEM focused on information sharing and relationship building.”

The 2016 GEM participants continued their travels to the Philippines to focus on the market potential for ethanol and DDGS imports. The Council has been involved in this market for almost a decade, promoting corn co-products like DDGS and USGC staff believe it has potential to purchase both more U.S. commodity grains and ethanol for fuel use.

“While in the Philippines, GEM participants got an overview of why Southeast Asia is an up-and-coming, dynamic region for U.S. feed ingredient imports,” said USGC Regional Director for South and Southeast Asia Kevin Roepke. “They also had a chance to explore the ethanol market in my region, one part of a worldwide effort by the Council to promote ethanol exports.”

The Philippines put an E10 ethanol mandate in place in 2009, with blend rates proposed to increase further to 20 percent by 2020 and remain at this level until 2030. If this happens, the country will need more ethanol including from imports.

“The group received a comprehensive overview of the Philippine market and they are returning home with valuable information and contacts that will facilitate working relations for many years,” Roepke said.

Updates on the GEM are posted on the Council’s social media accounts including Facebook and Twitter.