The Russian-Ukraine conflict is widely expected to disrupt supply chains, and imports in China would be affected. Chinese media are warning of a temporary rise in corn prices, which would sequentially lead to a chain of other costs increase.
State-media CCTV Finance reported from customs data that in 2021, 29.07% of the imported corn in the mainland comes from Ukraine.
Ukraine and Russian ports on the Black Sea are major export hubs for grain and coal, and even a shutdown of only three or four days would have a significant global impact on the supply chain.
Importers told the paper that they were not concerned about disruption. But they warned costs of corn could soar up for a short period. If that is the case, China could also expect higher values in animal feed prices and meat costs. This is because imported corn is mainly used for cattle feeding.
The corn imported from Ukraine mainly departs from Ukraine’s Kyiv river port and is transported by sea to various ports in China’s eastern and southern parts.
The report said that the values of corn imports had been steadily rising recently. It climbed from 1,900 yuan (300 dollars) per ton at the end of last year to 2,600 yuan (410 dollars) per ton at present.
Zhang Xiumin, product manager of Tianbang’s Supply Chain Center, said that each ton of ingredients needed to produce feeding for pigs has also increased by about 100 yuan (16 dollars).
Previously, corn and soybean meal prices had been running high due to the trade dispute between China and the U.S. After the Chinese New Year, prices of major bulk raw materials have risen to various degrees. Soybean meal has risen about 600 yuan (95 dollars) per ton. Wheat, barley, sorghum have also been increased to some extent.
Ukraine was also the third-largest source of grain imports in China in 2021. China News Weekly reported on February 25th that last year, the mainland imported 3.2 billion dollars worth of grains from Ukraine, mainly involving corn and barley, with total imports of about 12 million tons.
China imported 3.212 million tons of Ukrainian barley and 17.406 million tons of Ukrainian iron ore, accounting for 26% and 1.55% of China’s total imports in 2021, respectively.