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Chinese sorghum trade investigation brings market uncertainty

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The Ministry of Commerce in China announced last Sunday (February 4) that it had started anti-dumping and countervailing duty investigations into imports of US sorghum into China.

The probe is expected to take several months to a year or more, said Tim Lust, National Sorghum Producers CEO.

In a statement on the initial announcement of the investigation, he said that the National Sorghum Producers planned to fully participate with the authorities and he denied the allegations.

“What we can speak to is our commitment to the Chinese market and our great Chinese customers and partners,” ​he told FeedNavigator. “We don’t dump or unfairly subsidize our products, and we aren’t injuring anyone.  And, we hope that sensible minds and a fair investigation will prevail so that we can focus on the win-win sorghum trade between US farmers and China.”  

However, it remains unclear what prompted the start of the examination.

“We’re very aware that this is a time of growing trade tension between the US and China, and our guess is that this case may be part of that larger picture.

“Of course we weren’t consulted by those who brought the case so we can’t speak to any motivations with certainty.”

“The sorghum trade between the US and China is fairly done, in compliance with all trade rules – it is a win-win business relationship.

“Any fair investigation should determine that it should continue.”

Chinese sorghum market

It took several years of work to establish the current sorghum market between the US and China, said Lust. The relationship is seen as beneficial for both countries.

“China first entered the market as a customer of US sorghum in 2013,” ​he said. “Many factors and legwork prior to then led to China’s first purchase and enhanced relationships between US sorghum producers and Chinese end-users.”

The poultry and swine industries have been primary markets, he said.

“Duck and swine feed industries are the primary markets utilizing US sorghum in China.”

However, the announcement of an anti-dumping investigation by the Chinese authorities has made the US sorghum sector jumpy.

“We don’t know at this point whether additional duties will be applied, or if they are, the level/amount of any such duties,” ​said Lust.

“There’s understandably more uncertainty and anxiety in the market,”​ he added. “We will work hard to separate the rumors from the facts, and to make sure that we educate those conducting the investigation (and many others) with respect to several allegations that have no merit.”

Based on previous practices from the Chinese Ministry of Commerce, decisions regarding any additional duties are anticipated to be several months away, he said.

“We will obviously be working very hard throughout the process to defend our farmers and traders, and the completely fair nature of their sales to our Chinese partners.”

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