In 2011 Chongqing Grain Group Corp. announced a $2 billion plan to build a soy crushing plant, railways, and a large storage and transportation hub in order to export goods back to China. Yet as of today the company has only bulldozed 100 hectares, and even this activity has been halted. A Reuters investigation found that as many as two thirds of Chinese projects in Brazil face lengthy delays or are not even begun because of Brazil’s bureaucracy, stalled economy, and innate distrust of China’s push for land and commodities. Originally Chongqing planned to acquire large areas of farmland in conjunction with the soy crushing project and as negotiations moved forward, the Brazilian government tightened its rules for foreign ownership of land. Brazil’s economy has also been holding back investment. In 2010 the country’s economy was growing at 7.5% but today, barely 2% because of poor infrastructure and stagnant government agenda. In light of this, China seems to have changed its course and has focused on acquiring existing trading houses as indicated by its purchase of 51% of both Nidera BV and the agribusiness arm of Noble Group. To read further:
To receive relevant news stories with summaries provided by GAI Research & Insight, subscribe to Global AgDevelopments, our free bi-weekly enhanced eNews service