The use of distiller’s dried grains with solubles (DDGS) was the focus as U.S. Grains Council (USGC) staff met with feed millers and livestock producers in China, March 19-29. Council staff and a consultant visited feed mills in Guangzhou, Qingdao and Shanghai to learn more about current use of DDGS there and questions about using the grain co-product. The variable nutritional content and higher levels of mycotoxins in Chinese DDGS was noted by several meeting participants as providing a competitive advantage to U.S. DDGS. Representatives from the Liuhe Group, one of the largest integrated poultry producers in China, shared their view that China will import feed products such as DDGS in the near future and Liuhe Group will be the first to do so. The group also met with JCI Company, a company that tracks and provides agribusiness information in China. According to JCI Company, the market for DDGS in China is growing due to protein shortages. “China’s compound feed sector produced 70.3 million metric tons in 2004, an increase of 8.5 compared to the previous year. As the feed sector continues to expand there, so will the demand for DDGS,” says Ryan LeGrand, manager of international operations, who took part in the trip. “Our meetings with feed millers and importers, as well as the conferences, are furthering the Council’s on-going efforts to ensure that buyers and end users understand the benefits of U.S. DDGS so they are ready when China begins to import feed products.” USGC consultant Jerry Shurson, a swine nutritionist from the University of Minnesota, and LeGrand also conducted two DDGS workshops in Qingdao and Guangzhou for feed millers and swine producers – highlighting the importance of consistent nutritional content in developing cost-effective feeds, as well as the availability of U.S. DDGS and logistics of importing from the United States.
U.S. corn remains in high demand in South Korea. The USGC office in Seoul has learned from trade contacts that 362,000 metric tons (14.25 million bushels) of corn was purchased by Korea last week. Korea has imported 2.1 million tons (81.6 million bushels) of corn since January, 96 percent of that from the United States. “The recent flurry of large-scale purchases by Korea’s feed and industrial processing sectors is a result of a combination of market factors as well as the Council’s continuous market development work and long-standing commitment to servicing the needs of these important customers,” said Mike Callahan, USGC senior director of international operations – Asia. “Maintaining a permanent presence there to provide timely trade information and assistance has been vital to the Council’s campaign of restoring U.S. market share and dominant position in this market.” As a long-time supporter of trade with South Korea, the Council submitted comments on a proposed free trade agreement (FTA) with South Korea to the Office of the U.S. Trade Representative on March 24. FTA negotiations are scheduled to begin in June. Members may read the Council’s submitted comments on The GRAIN Center (www.grains.org/extranet) by clicking on “Reports,” then “Trade Policy Letters.”
Expanding the use of corn and corn co-products in broiler and layer diets was the subject of a training program for Russian poultry producers last week. Craig Coon, a USGC consultant from the University of Arkansas, led a seminar for nutritionists and managers of poultry farms and feed mills in Samara, Russia. The seminar covered a range of topics including modern evaluations of feed nutrition, ideal amino acid profiles, least cost feed formulations and nutritional requirements for broilers, layers and breeders. Coon noted that distiller’s dried grains with solubles (DDGS) could be competitive in Russia once it has received final registration clearance for importation. “DDGS is ready to break loose over there,” observes Coon. “I gave my specifications to the Russians and they formulated it for themselves.” He says the co-product is competitively priced and poultry producers are getting excited about gaining access to it. The Council will provide technical support for livestock and poultry feeding trials in Russia to increase awareness of DDGS as a feed ingredient and is working to get it registered for import. USGC consultants will conduct additional corn and co-products seminars to reach more producers in Russia, planting the seeds of demand.
Corn stocks are up and planting intentions are down, according to two USDA reports released. According to the Grain Stocks report, corn stocks are up 3 percent compared to March 1, 2005 at 6.99 billion bushels (177 million metric tons). The Prospective Plantings report indicates farmers are planting 78 million acres of corn, 5 percent fewer than last year. “The U.S. grain industry has tremendous capacity to respond to the market and produce enough corn to supply domestic and international demand,” says Erick Erickson, USGC special assistant for planning, evaluation and projects. “The Prospective Plantings tells us what farmers intend to do right now, but that could change if prices move. It’s going to be interesting to see what happens.”