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US-China trade skirmish sinks distillers dried grain prices 47pc
LONG a source of tension between China and the US, the largely containerised distillers dried grain has suffered a sudden price collapse because punitive tariffs, Bloomberg reports.
Spot prices for DDGs in Iowa plunged 47 per cent from a peak last June to $92.50 per short ton, the lowest for the time of year since at least 2007, US Department of Agriculture data show.
Prices for dried grains, a corn by-product that's used in animal feed, have tumbled to the lowest in a decade for this time of year.
China's move earlier in 2017 to impose import tariffs has significantly slowed American exports to the world's biggest market.
The woes of DDG sellers highlight the risk President Donald Trump's tough stand on trade poses to farmers. Protectionist policies could threaten crop shipments at a time when American grain inventories are piling up.
In the case of distillers dried grains, while other importing countries have stepped in to make purchases, there's still enough excess supply that US prices continue to slump.
"There's no home run like China sitting out there," said Kurt Shultz, senior director of global strategies at US Grains Council, an export development group.
"US agriculture is dependent on trade. If we don't have all of the doors open on trade that we can, we put our farm economy at risk."
Distillers dried grain are the dried, yellow flakes left over after the corn kernel's starch is fermented during ethanol production.
In January, China set anti-dumping duties and anti-subsidy tariffs on imports, both higher than rates imposed in a provisional decision in September.
Spot prices for DDGs in Iowa plunged 47 per cent from a peak last June to $92.50 per short ton, the lowest for the time of year since at least 2007, US Department of Agriculture data show.
Prices for dried grains, a corn by-product that's used in animal feed, have tumbled to the lowest in a decade for this time of year.
China's move earlier in 2017 to impose import tariffs has significantly slowed American exports to the world's biggest market.
The woes of DDG sellers highlight the risk President Donald Trump's tough stand on trade poses to farmers. Protectionist policies could threaten crop shipments at a time when American grain inventories are piling up.
In the case of distillers dried grains, while other importing countries have stepped in to make purchases, there's still enough excess supply that US prices continue to slump.
"There's no home run like China sitting out there," said Kurt Shultz, senior director of global strategies at US Grains Council, an export development group.
"US agriculture is dependent on trade. If we don't have all of the doors open on trade that we can, we put our farm economy at risk."
Distillers dried grain are the dried, yellow flakes left over after the corn kernel's starch is fermented during ethanol production.
In January, China set anti-dumping duties and anti-subsidy tariffs on imports, both higher than rates imposed in a provisional decision in September.
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