BEIJING, CHINA — China is asking trading firms and food processors to grow inventories of grains and oilseeds amid concerns of global supply chains should there be a second wave of coronavirus (COVID-19) and worsening infection rates elsewhere, Reuters reported.
Trade sources told Reuters that state-run and private grain traders were urged to procure higher volumes of corn, soybeans and soy oil during calls with China’s Ministry of Commerce.
One source noted that “things aren’t looking good in Brazil,” which is a key supplier of soybeans to China. The nation’s number of coronavirus cases has passed those in Spain and Italy.
Reuters said China's Ministry of Commerce did not respond to request for comments.
China already has seen soy inventories sink to record lows after Brazilian shipments were delayed in March and April due to heavy rains and reduced manpower as COVID-19 measures took effect.
Shipments from Brazil have rebounded, but there is still concern about future disruptions.
COFCO and grain stockpiler Sinograin have been stepping up purchases of US soybeans and corn in recent weeks, Reuters said.
Chinese importers bought at least four cargoes, or about 240,000 tonnes, of US soybeans for shipment beginning in July, two traders familiar with the deals said.
Beijing also has increased its allocations of crop import quotas to major grain buyers, paving the way for further potential purchases.
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