Sino-Global Shipping America, a non-asset based global shipping and freight logistics integrated solution provider, has signed a non-binding MoU with Yunnan Jingyifeng Supply Chain Management (JYF) to jointly develop the business of exporting agricultural products to China
These products include fertiliser raw materials such as sulphuric acid, vegetable oil, soybean, barley, wheat and dried grains with solubles, which are used for fuel production, feeding and other agriculture needs.
The company has seen a considerable increase in export demand following the 15 January 2020 signing of the US-China Phase 1 deal, which included China's commitment to purchase US$200bn USA products over the next two years.
Under the MOU, JYF aims to use Sino-Global's customer relationships and experience as a procurement agent in purchasing approximately 1,000,000 mt of these products per year, which will then be marketed to JYF's customers in South West China, including Guangxi, Yunnan, Guizhou and Sichuan provinces.
The company anticipates reporting an increase in agency-based trading revenue, with the current market prices ranging from US$75 per tonne for sulphur products to US$400 per tonne for soybean products. Sino-Global's revenue under similar types of arrangement typically ranges between eight and 12 per cent of the total amount.
Lei Cao, CEO of Sino-Global, stated, “The US has historically been a net importer of sulfuric acid and has not historically exported significant volumes to China, and the impact of COVID-19 has placed considerable pressure on China-based importers to expand and improve their supply chain network in order to meet the demands under the agreement. Sino-Global will provide a turnkey supply chain logistic service solution for JYF, which can then sell these products directly to Chinese clients.”
