DDGS Redirection

Exports to China drop, but increase dramatically to Mexico
By Holly Jessen | April 15, 2011

As expected, China’s anti-dumping investigation into U.S. DDGS slowed exports to the country in January. A surge in exports to other areas made up the difference, however.

Total DDGS exports were at 714,000 metric tons, virtually identical to the 713,600 metric tons exported the previous month, according to government data released in March. China, the top export market in 2010, exported 129,000 metric tons, down 30 percent. On the other hand, exports to Mexico surged 76 percent, jumping from 130,000 metric tons in December to 229,000 metric tons in January.

China announced its anti-dumping investigation the end of 2010. In just three years, U.S. exports to China went from zero to a whopping 3.1 million metric tons. That put the country on the top of the list of export destinations, followed by Mexico and Canada. To rule against the U.S., China must show evidence that DDGS have been dumped on the Chinese market at prices lower than what other buyers pay, injuring Chinese interests. The decision is expected by the end of 2011, with the possibility of a six-month extension.

China has a strong and dynamic economy that recently passed up Japan as the second largest economy in the world, says Rebecca Bratter, U.S. Grains Council director of trade development. As countries grow and industrialize their ag sector, such as hog or dairy industries, more protein inputs, such as DDGS or corn are needed. From USGC’s point of view, the increases are part of the normal course of trade. “Things changed very fast for China,” she said, “and I think going from a net exporter to a net importer of any product is going to involve a period of adjustment and I think that’s the phase we’re in right now.” 

—Holly Jessen