US 2000/01 corn exports dented by StarLink
Date: 10-Sep-01
Country: USA
Author: K.T. Arasu
Gene-altered StarLink corn slipped into the U.S. food chain nearly a year ago, just weeks into the 2000/01 marketing year, sparking recalls of food items such as taco shells. The United States does not allow the corn for human consumption, but only for animal feed.
Corn export sales until Aug. 30 of the 2000/01 marketing year, which ended Aug. 31, totaled 1.97 billion bushels, the U.S. Agriculture Department said last week. Sales made on Aug. 31 will be reflected in the USDA's report this week.
The Aug. 30 tally beat the USDA's August estimate of 1.875 billion bushels, but fell short of its initial target of 2.275 billion. It was above the 1.937 billion sold in 1999/2000.
The USDA data showed that imports by Japan, the single largest buyer of U.S. corn, in the 2000/01 season dipped 6.0 percent to 15.5 million tonnes from the previous year. Imports by South Korea rose by 110,100 tonnes to 3.32 million tonnes.
Japan does not allow StarLink corn for either food or feed production, while South Korea allows the gene-modified variety only as animal feed.
Analysts and exporters said they were expecting the impact of StarLink corn on exports to be less severe in the 2001/02 marketing season, because the variety was not grown this year, although some StarLink corn could still be in storage bins.
They said the challenge in the marketing of U.S. corn this year could come from China, which is attempting to make inroads in Taiwan, which buys most of its corn from the United States.
"Taiwan is one of the last markets that's solely a U.S. market in the Asian region," said grain analyst Shawn McCambridge of Prudential Securities.
"It doesn't mean Taiwan will turn their entire export program to China," he said. "We'll still keep a dominant position in the Taiwanese market."
There are expectations Taiwan would begin buying Chinese corn from early next year in anticipation of its lifting of a decades-old ban on importing grain from China once Beijing joins the World Trade Organization, expected in early 2002.
McCambridge said the decline in Japan's import of U.S. corn in 2000/01 showed "what happens when we have an issue like StarLink to deal with."
He did not, however, expect any serious impact on U.S. corn sales in the 2001/02 marketing season from StarLink. "The EPA has stated that most, if not all, StarLink corn has been removed from U.S. supplies. It's not a real issue," he said.
He said South Korea's large purchase of South American corn indicated some lingering concern over StarLink corn.
Last week, Argentina said it had sold 950,000 tonnes of corn to South Korea as of Aug. 24 in the 2000/01 season, compared with 60,000 tonnes in the same 1999/2000 period.
Analyst Dan Cekander of Fimat Futures said export sales to Japan could recover if it allows imports of animal feed to contain up to 1 percent of unapproved genetically modified organisms (GMOs).
"If that is official, they can bring it in for food and if it doesn't pass the test, they can just slip it into feed use."
Japanese officials said last month steps would be taken to approve a tolerance level following recommendations from an advisory panel, but did not know when it would take effect.
