China halts US sorghum dumping probe

China has terminated anti-dumping and countervailing duty investigations into imported sorghum from the United States, as domestic farmers have had difficulties selling pork products due to lower prices, the Ministry of Commerce announced on Friday.

The ministry said it found prices of domestic pork products had declined, affecting the livelihoods of many farmers.

Under such circumstances, it is not in the public interest to level a trade investigation on sorghum imports from the US, which can be used to formulate animal feed. The government will also return temporary antidumping deposits collected at Chinese customs, the ministry said in a statement.

To protect domestic industry from dumping activities, China began to impose provisional anti-dumping measures on sorghum imported from the US from April 18. Importers of the product were required to pay deposits on the value of the shipments upon arrival, at a rate of 178.6 percent.

"China's decision is based on domestic pig farmers' interests," said Ding Lixin, a researcher at the Chinese Academy of Agricultural Sciences in Beijing.

He said sorghum became a hot crop in China after the country banned corn imports from the US in 2013; corn imports resumed in 2014.

Because of price differences between domestic and overseas markets, Ding said many animal feed companies began to use cheaper imported corn, sorghum, barley and distiller's dried grains in 2012 and many of them now rely heavily on foreign shipments to control operating costs, especially in the Guangxi Zhuang autonomous region, and Guangdong and Fujian provinces.

Sorghum produced in the Inner Mongolia autonomous region can be sold for about 3,000 yuan ($471) per metric ton, while the price of US sorghum was between 1,700 yuan and 1,800 yuan per ton in April, data from National Grain and Oils Information Center show.

The US surpassed Australia to become China's biggest sorghum supplier in 2014, and its sorghum exports to China surged from 317,000 tons in 2013 to 4.76 million tons in 2017, data from the Ministry of Commerce show.

China must accelerate the pace of supply-side structural reform in the agricultural sector, as it can effectively guarantee supply and increase farmers' incomes, with a focus on improving the quality of agricultural supplies, said Chen Jie, a researcher at the research center for the rural economy of the Ministry of Agriculture and Rural Affairs.

More than 80 percent of all US sorghum exports go to China, according to the US Grains Council. In addition to feeding cattle, sorghum is also used as an ingredient in the strong Chinese liquor, baijiu - bringing US farmers about $1 billion each year from China.

Kansas, Texas, Colorado, Oklahoma and Nebraska were the top five states for sorghum production in the US last year.