The China Cob: all the biggest China corn news from

March

March has been a busy month for corn products in China. Here is a roundup of all the
biggest news from the last four weeks.

You can find more detail on these stories, along with more news, market data, and indepth analysis in CCMs E-Journal Corn Products China News.
If you would like to take a no-strings Free Trial of Corn Products China News for two
months, send us an email to econtact@cnchemicals.com and well happily set it up for
you.
Now, heres the news:
COFCO Biochemical raises lysine prices
On March 25, 2015, COFCO Biochemical (Anhui) Co., Ltd. (COFCO Biochemical) raised
the prices of its 98% lysine and 70% lysine products by 0.02USD/kg (0.1RMB/kg) to
1.4USD/kg (8.6RMB/kg) and 0.07USD/kg (0.4RMB/kg) to 0.91USD/kg (5.6RMB/kg)
respectively.
In mid-March, the South Korea-based CJ Group also raised the price of its lysine
products 10%. CJ Group disclosed that the main reasons for the rise were low profits and
the sustained devaluation of the Euro. CJ Group will suspend production for an overhaul
in the coming months.
In addition, several large manufacturers have also lifted the quoted prices of their lysine
products - Zhucheng Dongxiao Biotechnology Co., Ltd., for example, have raised prices
10%. Currently, several lysine manufacturers have suspended production, so lysine
prices are in a significant upward trend.
Meihua Bio: revenues up 27% in 2014
Meihua Holdings Group Co., Ltd. (Meihua Bio) has released its 2014 annual report.
According to the report, the companys revenues reached USD1.60 billion (RMB9.86
million) in 2014, up 26.79% year-on-year, while net profits rose 23.95% year-on-year to
USD81.33 million (RMB500 million). The performance was in line with expectations.
Meihua Bio attributed its strong growth in revenues in 2014 to four factors:
1.New production capacity comes onstream
Since 2013, Meihua Bio has gradually been bringing its new production facilities
onstream and improving the technology in these new facilities. The increased output led
to a boom in revenue in 2014.
2.M&A activity boosts profits
Despite overcapacity and depressed prices in Chinas corn products industry, Meihua Bio
has carried on an active M&A strategy, using USD618.74 million (RMB3.8 billion) to
acquire 100% equity in Ningxia EPPEN Biotech Co., Ltd. (Ningxia EPPEN Biotech), a

producer of MSG, lysine and threonine. The move is a sign of Meihua Bios confidence
towards its future prospects.
3.Company has gained large degree of control over the MSG market
Meihua Bios acquisition of Ningxia EPPEN Biotech will give the company a significant
market share, and increased ability to set prices. The company has also reached a
similar position in the amino acids market, where it has a 35% share of the global market
for lysine, and 50% and 20% of the global threonine and I+G markets respectively.
4.Development of downstream bio-pharmaceuticals fields
In May 2014, the company acquired 51% equity in Shanxi Guangsheng Pharmaceutical
Packaging Co., Ltd. (Guangsheng Pharmaceutical) via a share transfer and capital
increase. Guangsheng Pharmaceutical is the leading empty capsules producer in China.
JPAC partners Atider to develop high-yielding corn cultivation technology
On March 23, 2015, Jilin Provincial Agriculture Committee (JPAC) and Mexico-based
Atider Modern Agricultural Development Co., Ltd. (Atider) signed a cooperation
agreement. Under the agreement, Atider will provide technical consulting and advisory
services to JPAC as it develops its 200 ha (3,000 mu) experimental demonstration field in
Jilin Province to test its new high-yield corn cultivation technology.
Jilin is a large agricultural province and a key center for grain production in China. Grain
output in the province totaled 35.33 billion kg in 2014, the fourth-highest in China, and the
per unit grain yield in Jilin was higher than any other province in China at 470.98 kg/mu.
Jilins agriculture is being mechanized fast and 77.8% of farms in the province now use
modern equipment, the sixth highest in China. The technology support provided by Atider
should help Jilin increase grain output even further in 2015.
Atider is a technical consulting company providing a full range of services to companies
looking to raise crop yields. The company mainly engages in research into cultivating
high-yield corn. Atider has set records for the highest-yielding corn in Mexico for 16
consecutive years, and has become the top corn production company in the world.
Chinas feed industry urges government to relax restrictions on corn imports for
private companies
Chinas private feed companies are urging the government to reform the countrys corn
import quota system, which allows state-owned enterprises to import grain from abroad at
low prices but prevents private companies from doing the same thing. The private
companies argue that this rule harms their competitiveness in the international market
and gives state-owned companies an unfair advantage
Demand for wheat in China shrinks in Q1 2015

Wheat prices in China are expected to fall slightly in Q2 2015 due to weak demand.
However, falling wheat prices will not impact corn prices
Guangji Pharmaceutical (Mengzhou) restarts VB2 production
Guangji Pharmaceutical (Mengzhou) has announced that it restarted VB2 production on
February 28, 2015. The company reported that the halt in VB2 production will not have a
great impact on its VB2 sales or its performance in 2015
Ukraine plans to ramp up corn exports to China
Ukraine intends to double its corn exports to China, putting more pressure on US exports
and providing more low-priced corn to the Chinese companies that are not restricted from
buying imported corn through the import quota system...
Er-Kang Pharmaceutical: Cambodian subsidiary obtains kosher certificate
Cambodia Wangkang Biochemical Co., Ltd. (Wangkang Biochemical), the Cambodiabased subsidiary of Hunan Er-Kang Pharmaceutical Co., Ltd. (Er-Kang Pharmaceutical),
announced in March that it has received kosher certification for its citric acid, ammonium
citrate, potassium citrate and sodium citrate products from KOF-K Kosher Supervision
(KOF-K), a member organization of the Association of Kashrus Organizations, Kosher.
The announcement will help Wangkang Biochemical increase exports, and the
recognition that its products have received from international customers should help
strengthen their international competitiveness.
Wangkang Biochemical mainly engages in the production and sale of citric acid,
ammonium citrate, potassium citrate and sodium citrate products. Over 70% of the
company is owned by Hunan Er-Kang (Cambodia) Investment Co., Ltc., while Hunan
Dongting Citric Acid Chemical Co., Ltd. holds a 25% stake, and Liuyang Lianbang
Investment Co. Ltd. owns 5%.
EEU imposes anti-dumping duty on Chinese-manufactured citric acid
The Eurasian Economic Union (EEC) has decided to impose a five-year anti-dumping
duty of Chinese-manufactured citric acid following a joint meeting of the Eurasian
Economic Commission (EEC) on March 13, 2015. According to the news department of
the EEC, the following tariff rates will be introduced against Chinese manufacturers:
- Weifang Ensign Industry Co., Ltd.: 4.2% of the customs value (value evaluated by the
Customs Union)
- TTCA Co., Ltd.: 6.82%
- Yixing-Union Biochemical Co., Ltd.: 16.97%
- Other exporters and/or manufacturers: 16.97% of the customs value

Citric acid imports from China to countries inside the EEU Customs Union increased
38.3% between 2010 and 2013, while the average import prices of Chinesemanufactured citric acid fell 7.3% over the same period. Citric acid from China had
become significantly cheaper than acid from any other country, and by 2013 China
accounted for over 90% of citric acid imports to EEU member states.
Moreover, cheap Chinese imports had also begun to undermine the EEUs domestic citric
acid industry. From 2010 to 2013, sales of citric acid among EEU producers fell 3.1% and
output dropped over 7%.
In a similar move, Indias Ministry of Commerce and Industry announced on February 26
that it has suggested introducing an anti-dumping duty of 367.59 USD/t on imports of
sodium citrate from China.
Corn starch prices predicted to rise in China in Q2 2015
With corn supplies tightening due to a significant expansion of the Chinese government s
grain purchasing and storage policy, CCM predicts corn and starch prices to rise steadily
during Q2 2015
Chinas citric acid prices rebound in March 2015
Stimulated by rising raw materials prices and increased orders from overseas buyers,
citric acid prices in China rose in March. However, with the citric acid industry in China
still mired in overcapacity and anti-dumping sanctions against Chinese-manufactured
citric acid still in place in the EU, CCM predicts that domestic citric acid manufacturers
will find it hard to reverse their losses in the near future...
Henan Lotus reports profit turnaround in 2014
Henan Lotuss 2014 earnings pre-announcement has reported that the company made a
net profit last year, helped by government subsidies...
Downturn in Chinas furfural market continues
Market prices of Chinese-produced furfural are expected to continue declining due to
falling downstream demand and decreasing orders both at home and abroad
Output of DDGS rebounds in China in March 2015
DDGS output has been declining in China over the last few months due to the seasonal
slowdown in production in Chinas alcoholic beverages industry. However, boosted by the
rising price of corn, a key raw material, DDGS output has shown signs of picking up in
March
Longlive Biotechnology partners GIEC to develop bio-aviation fuel technology

Longlive Biotechnology will further expand its cellulosic ethanol production and research
new applications to increase revenues

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