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Warning of foreign sway over grains

CHINA'S Customs has warned that foreign funded companies have more control over domestic grain production.

Singapore-based Wilmar International Ltd planned to invest US$3 billion to purchase trans-gene soya beans in northeastern China, which was part of its attempt to monopolize the industry and the domestic edible oil market, according to the General Administration of Customs and media reports.

Meanwhile, Paris-based multinational conglomerate Louis Dreyfus Group is seeking candidates to work as its deputy general manager in charge of negotiations and purchasing soya beans in northeastern China, a Beijing-based newspaper reported.

China was one of the oldest habitats of soya beans and a major exporter once. However, it became the biggest importer from 2000 when it bought more than 1 million tons of soya beans that year. Its purchases even reached 28 million tons six years later, about 1.77 times the domestic production, which means 64 percent of soya beans in the Chinese market were imported.

Multinational grain traders have been carrying out a series of merger and acquisition activities in China since 2004. About 70 percent of oil processing plants in China were foreign invested or joint ventures, while 80 percent of the country's soya bean oil pressing capability were controlled by multinationals.

Customs warned the country to avoid making the same mistakes in its other major agricultural products, such as rice, wheat and corn.

China exported 3.49 million tons of grains by November, down 67.5 percent from 2007, according to Customs data. Its total value was US$1.95 billion, a 29.2-percent drop from 2007, customs said. During the same period, China imported 34.14 million tons of soya beans, up 22.4 percent from a year ago.

Nie Zhenbang, director of the State Administration of Grain, said he would urge state-owned grain enterprises to lead purchases and store more grain and oil in major cities and regions.


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