China wants to be more competitive on the world exporting stage, particularly when it comes to competing against major global firms like Archer Daniels Midland, Bunge, Cargill, and Louis Dreyfus.
This month, the Chinese government announced that Chinatex, which trades both grains and textiles, would merge with China National Cereals, Oils and Foodstuffs Corp., also known as COFCO. The deal builds upon the news from earlier this year, when COFCO, Chinatex and China Grain Reserve Corp. agreed to cooperate on China’s plan for grain purchasing, storage, processing and more.
While the firms may not be household names in the United States, they are Chinese powerhouses.
According to a China Daily article, “the three companies hold a pivotal position in terms of the total volume of traded grain. Their total volume of purchased corn exceeds 50% of domestic trading volumes and the import volume of soybeans accounts for more than 30% of the total volume of imports to China.”