A group of Chinese grain traders are building a northern trade corridor by leasing land in Mongolia’s pristine grasslands and Russia’s untainted Siberia. Those crops are already landing on European dinner tables, and they now end up in Chinese stomachs as well. “About 20 Chinese farming companies are cultivating more than 1 million mu (66,666.67 hectares) of land in Mongolia and shipping their harvests back into China,” Hou Yongjun, president of Erenhot Jinguyuan Grain and Oil Co, told the Global Times on April 25…Full Article: The Global Times May 2017

Key Points

  • According to a resident of the border city Erenhot, Inner Mongolia Region, Northern Chinese farmers prefer to lease farmland in Mongolia and Russia (Mongolia being the cheaper option), while farmers the eastern provinces of Zhejiang and Jiangsu prefer to lease farmland in Africa.
  • Erenhot’s railway port recently received permission from the Chinese government to import grain. Subsequently, Inner Mongolia Dongxin Agricultural Technology Development invested CNY 30 million [USD 4.4 million] in a grain depot facility that can offload dry bulk goods from trains efficiently. The facility is expected to be completed by the end of September 2017 (began in mid-April 2017). The company imports rapeseed and linseed from Russia, Mongolia, and Kazakhstan.

ChinaAg Comments

  • In November 2016, the Erenhot-Rotterdam railway route (~12 days) was launched. The inaugural train transported 200 MTs of linseed expeller (aka flaxseed cake) to the Netherlands. The linseed originated from Russia and Mongolia, but was processed/loaded in Erenhot.
  • From January to May 2016, China exported 1,024 MTs of fresh produce to Russia via the Erenhot Customs checkpoint (Inner Mongolia and Mongolia).

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