COFCO's' heavy warehouse 'expands procurement channels in Brazil

On December 19th, Bloomberg News website published a report titled "China's largest agricultural trader bets on Brazil", compiled as follows:

In 2014, while flying over the southern coast of Brazil, Ning Gaoning saw the future. The chairman of COFCO Corporation Limited saw dozens of trucks and trains loaded with agricultural products through the airplane window, all heading towards Santos Port

In his memoirs, Ning Gaoning wrote that at that moment, he realized that the company needed to have a place in the largest port in South America. He believes that this will help COFCO, a Chinese state-owned enterprise, enter the ranks of world-class agricultural trading firms

In 2022, COFCO Group obtained a 25 year franchise for a large terminal at Santos Port, investing funds to upgrade and expand the related facilities of the terminal. This dock is expected to be put into use next year. COFCO Group used to be a company focused on trading and producing agricultural products for the Chinese government. Now, the company has engaged in agricultural trade and production in more than 50 countries

The report states that its rise has also expanded China's insight and influence on the global food supply chain

Brazil has become a key factor for China to achieve procurement diversification, as most of China's soybean and corn imports currently come from Brazil. The leadership of COFCO Group has clearly expressed its determination to invest in Brazil for the long term on multiple occasions

According to reports, the new terminal at Santos Port will triple COFCO's annual cargo capacity at the port, reaching 14 million tons and loading approximately 200 ships annually

Due to the connection between the port and the railway, which is cheaper than truck transportation, COFCO Group will be more competitive in purchasing soybeans and corn from Brazil's largest production area

At the same time, COFCO is increasing its efforts to purchase more soybeans, sugar, and corn from Brazilian farmers and hire more traders

The report states that all of these are supporting COFCO and China's efforts to hedge the imminent US China trade tensions

Former President of the American Chamber of Commerce, Gibbs, said, "They have significantly strengthened their trade relationship with Brazil, which will certainly be helpful for China. But a trade war will cause harm to both sides