China restricting corn imports
A market analyst says corn is one of the U.S. commodities being “punished” by a sudden shift in Chinese trade policy.
Global Commodity Analytics president Mike Zuzolo tells Brownfield customs authorities in China began restricting imports into free trade zones this week.
“This goes to a Bitcoin clampdown, this goes to commodity speculation in general, let by the metals and led by iron ore and copper. Corn happens to be part of it.”
He says high commodity prices prompted the move as China works to recover economically from the COVID-19 pandemic.
Bloomberg reports several Chinese feed mills recently canceled U.S. cargoes, but Zuzolo does not expect China’s appetite for corn to be significantly curtailed.
“I try to do a lot of research and reach out to a lot of contacts that are very much in the know in Asia right now, and I feel satisfied in saying I don’t think their stockpiles were as big domestically and the quality of those stockpiles were not nearly as good as what maybe they were saying it would be.”
Zuzolo says another reason to believe China still needs corn from the U.S. is because for at least the next four to five months Brazil and the rest of the world will have a limited supply.