Chinese look to Putin for boost in relations

According to Chinese state media the Chinese are looking forward to Vladimir Putin’s return to the Russian Presidency, though I am guessing they did not miss him too much since he has been serving as Russia’s Prime Minister. The Chinese are looking for Putin to continue to boost China-Russia relations over the next 6 years.

Putin has been an active promoter of China Russia ties, during his first term as President of Russia the two counties signed "China-Russia Treaty of Good-Neighborliness, Friendship and Cooperation", which was to promote political and commercial ties.

Tatiana Pecherskaya

Blue Bridge consultant Tatiana Pecherskaya points out that despite the world’s financial crisis, bilateral trade volume has risen between the two nations and that China is Russia's number one trading partner as of 2011.

The Chinese benefit from Russian commodities purchases of oil, gas and timber to name a few and with the development of a new gas pipeline from Russia to China there seems to be no slow down in trade between the two nations.

The financial cooperation between the two nations isn’t one sided, China is the 5th largest investor in the Russian economy.

 A bump in the road between the two nations might be that other Asian nations have actively pursued military purchases from Russia to include Vietnam, which has several territorial disputes with China that have recently flared up in the South China Sea and it is thought that the Philippines is interested in upgrading their naval capabilities with Russian military hardware to protect their interest in the South China Sea.

David Nealis

Other than sharing a border the Chinese and Russians also are both permanent members of the United Nations Security Council, BRIC Club Members and SCO members. The SCO or the Shanghai Cooperation Organization is a Central Asian focused platform for regional countries to promote security, stability and trade.

The China – Russia relationship is long and complex, but it is safe to say as long as the Chinese demand for commodities is high, they will continue to import commodities from Russia.

This article has been co-written by David Nealis and Tatiana Pecherskaya of Blue Bridge.

China continues to be an ideal place for firms looking for growth, what is your firm’s China Market Strategy?

Futures and Options Risk Disclosure
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China to Become World's Largest Diamond Market

Ari Epstein CEO of the Antwrp World Diamond Centre says he believes that China may overtake the USA to become the world’s largest diamond market by the end of 2015 as demand rises in China for luxury goods.

Chinese firms have recently announced major deals with many African firms to mine for diamonds and China is already a major diamond polishing center.

China continues to be an ideal place for firms looking for growth, what is your firm’s China Market Strategy?

Futures and Options Risk Disclosure
Trading futures and options involves the risk of loss. You should consider carefully whether futures or options are appropriate to your financial situation. You must review the customer account agreement and risk disclosure prior to establishing an account. Only risk capital should be used when trading futures or options. Investors could lose more than their initial investment. Past results are not necessarily indicative of futures results. The risk of loss in trading futures or options can be substantial, carefully consider the inherent risks of such an investment in light of your financial condition.

China harvested its 7th largest corn crop in eight years, but it falls well below domestic demand.

China harvested its 7^th largest corn crop in eight years, but it falls well below domestic demand.

Despite China harvesting its seventh record corn crop in eight years, China has struggled to meet the insatiable demands of its middle class. Corn which forms the basis of sweeteners, starch, alcohol, ethanol  and feed for livestock, has become a vital commodity to the China market.

Chinese corn production reached 189.2 million tonnes in the harvest that began in September, 6.7 % more than last year, according to a survey of growers in the seven main producing regions carried out by SGS SA.

According the USDA, Chinese demand rose 50% since 2000 but output only gained 38%,which is insufficient to meet the demand and is driving prices to the highest ever annual average. The explosive economic growth in China in the past decade has spurred a change in diets, China’s  dairy herd has almost tripled since 2000, and per capita pork consumption rose 26 %.

China already buys about a quarter of all U.S. soybeans and  has become a net importer of corn for the first time in 14 years in 2010. In July, China ordered 21 million bushels of U.S. corn in one order, which is more than the U.S. government thought China would purchase annually . The purchase took the market by surprise and then China bought another 2.2 million bushels of U.S.

Prices in Jilin China rose 17 %  and touched a record 2,43 yuan a tonne on September 19, according to Shanghai JC Intelligence, the mainland's biggest independent agricultural researcher. Only US farmers grow more corn and the US consumers consume more corn than China.

Since China is secretive about the levels of commodities it holds in its strategic reserves, the rest of the market can only guess what its supply needs are, but the USDA forecasts that China will import 79 million bushels of corn for the 2011-2012 crop year. Some grain traders are even more optimistic, but they have been wrong before about China's appetite for U.S. corn, In the mid 1990’s US farmers thought the Chinese would become annual buyers, though  China's middle class is much larger than in the 1990s , maybe we are entering a golden age of Chinese consumption.