Experts say additional supply would reduce reliance on imports from US
China and Ukraine are in talks about deepening trade links, particularly in the food andagriculture sector.
Top government officials from both countries talked about starting importing Ukrainian corn tothe Chinese market during a recent meeting in Beijing.
Oleg Bakhmatyuk, chairman of the board of Ukrlandfarming Plc, the largest Ukrainian agro-industrial company, said he had been encouraged by talks between Minister of Agriculture HanChangfu and Ukrainian Foreign Minister Konstyantyn Hryshchenko.
"Chinese government officials have attached great importance to agricultural cooperation withUkraine and we believe we will soon have market access for Ukrainian corn to enter China,"Bakhmatyuk, who was part of the official Ukraine delegation, told a news conference.
He also said his company was in talks with major Chinese food companies, such as ChinaNational Cereals, and China Oil and Food Corporation, the country's largest State-owned foodconglomerate, about sales of Ukrainian corn into China, and that the signs were clear that thetwo countries will enhance their commercial ties.
In 2011, bilateral trade stood at $10 billion, well ahead of the target set by two governments.
China imported 1.88 million metric tons of corn during the first five months of this year, officialdata showed, compared with the total corn imports of 1.75 million in 2011.
Industry analysts estimate this year's total imports will be between 3 and 4 million tons, mostlyfrom the United States.
In June, the central banks of China and Ukraine signed a currency swap agreement totaling 15billion yuan ($2.3 billion).
Vadim Tolpeco, an aide to Bakhmatyuk, added:
"The currency swap sets the scale for bilateraltrade, which will be led by agricultural trade."
Bakhmatyuk said that, looking wider than just corn, he expected Ukrainian farm producers ingeneral to "become major players in the Chinese market in the future".
Analysts agree that the two countries are highly complementary in the agricultural sector, andfood imports from Ukraine could help reduce China's reliance on traditional suppliers such asthe US.
"China can provide Ukraine with production materials such as seeds and agriculturalmachinery, while Ukraine can sell its products to China," said Huang Dejun, general manager ofBeijing Orient Agribusiness Consultant Ltd, a consulting firm specializing in agribusinessconsulting services to the food industry.
According to data from Ukrlandfarming, Ukrainian corn is highly competitive in price and couldbe imported to Shanghai for 25 percent less than US corn.
"The fact that Ukrainian corn is not genetically modified will also make it very popular in China,"Huang added.
Besides corn, China will also be interested in buying sugar, pork and sunflower seed oil fromUkraine in the near future, Huang said, as China's population nears an expected peak of 1.48billion by the end of 2020, putting huge strain on the country's food supply.
zhousiyu@chinadaily.com.cn
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