Economy

Soy oil imports reinstated

By Zhou Siyu (China Daily)
Updated: 2010-12-02 09:25

China has re-opened the door to agricultural products from Argentina after local tariffs sparked a trade dispute.[Photo/China Daily]

Talks with Argentinian officials broke the agricultural deadlock

BEIJING - China has reopened its $2-billion market to Argentinian soy oil, after the world's second-largest economy resumed imports from the South American country in October, Julian Dominguez, Argentina's minister of agriculture, livestock and fisheries, said on Wednesday.

"Shipments of soy oil are expected to arrive in China in December and January, and exports are expected to bounce back to the pre-suspension level," Dominguez said.

Cesar Mayoral, the Argentinian Ambassador to China, said the problems (concerning soy oil exports to China) have been resolved through talks between the two countries.

"There have been anti-dumping investigations against China to protect local industries and products in Argentina, and China's actions in resuming imports have spelled out its goodwill in improving the bilateral trade relationship," he said.

The resumption of soy oil imports has been frequently discussed by senior officials from both sides, which signaled a thawing bilateral trade relationship, Mayoral said.

Shipments from Argentina to China had been halted since March, after the country imposed new standards on soy oil imports as a response to Argentinian protection measures against Chinese commodities.

As a result, for the first three quarters of this year, its exports of animal and vegetable fat and oils to China dropped by 83.5 percent year-on-year to $220 million, according to data from the Chinese Administration of Customs.

Soy oil export is the pillar of Argentina's economy: the South American country is the world's leading exporter of soy oil, and the largest supplier of crude soy oil to China.

More than 40 percent of its soy oil is exported to China. That accounted for 4.6 million tons in 2009, more than twice the amount it sells to India, its second-biggest customer.

In the meantime, Chinese companies turned to Brazil and the US to alleviate the shortage in soy oil imports.

In addition, Argentina is also trying to export corn to China, and "is expecting to see the Chinese market open for our corn by the first half of 2011," said the Agriculture Minister.

"China is of vital importance to our development plan for the next five years," he added.

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The minister made the remarks as he was leading a delegation of 45 high-ranking government officials and business representatives to sign three sanitary protocols with the Chinese State General Administration for Quality Supervision, Inspection and Quarantine.

The protocols cover the export of fresh deboned beef and barley from Argentina to China, as well as the trading of dairy products between the two countries.

This is the first time Argentina has open up its market to Chinese dairy products.

"We estimate the export of beef to China during the next year will reach 5,000 tons, about $50 million to $60 million," he said.

China is by far the largest market for Argentinian agricultural products, and the South American country is the third-largest supplier of agricultural products to China, after the US and Brazil, according to official statistics.

In the first nine months of this year, Argentina's exports of vegetable products, such as soybeans and corn, shot up by 228.2 percent year-on-year to $3.95 billion, accounting for 76.7 percent of the overall export volume, according to figures released by the Chinese Administration of Customs.

Sales of animal products to China, including poultry and cattle hides, grew by 34.4 percent to $ 88.78 million for the nine-month period, official data showed.