Governor McDonnell Announces New Grain Trade Deal in Chesapeake
On August 13th, VGPA staff joined a group of government and agriculture industry representatives to celebrate Governor Bob McDonnell's announcement that Perdue Agribusiness has reached a new agreement with China's Jiusan Oil and Grain Industries Group to supply up to 8 million bushels of soybeans in a series of bulk shipments for the 2013-14 crop. The agreement was facilitated during meetings held in Beijing in April during the Governor's trade and marketing mission to Asia. Agricultural and forestry exports from Virginia continue to grow, with the Commonwealth reaching a record high of $2.61 billion in 2012.
Governor McDonnell and staff organized a meeting and related discussions between Jiusan Group officials and executives from Perdue AgriBusiness, where the two sides agreed to the sale of up to four Panamex vessels of soybeans from the upcoming season's crop, which will be ready for export in October. Each Panamex vessel holds approximately 55,000 metric tons, or more than 2 million bushels, of soybeans. The value of the shipments will depend on market prices at the time each order is placed. For reference, the August 12, 2013, closing price for new crop soybeans from the Norfolk terminal, as reported by Virginia Market News Service, was $12.10 per bushel.
The new agreement, which occurred after VDACS staff first introduced Jiusan and Perdue officials in 2012 to explore opportunities for a business relationship, will mean soybean shipments from Virginia will reach new market areas within China through Jiusan's network of processing plants. This agreement will further expand the reach of Virginia's agricultural exports to this fast growing market and continue to diversify Virginia's customer base in the leading market for Virginia agricultural exports.
VGPA commends Governor McDonnell and Perdue Agribusiness for their continued efforts to open and expand new international grain markets. We look forward to more opportunities to provide high-quality Virginia grains to international consumers.