Governor McDonnell Announces Purchase Letters of Intent between Taiwanese Importers and Virginia Soybean and Grain Producer Groups

Press Release

Governor Bob McDonnell announced today that leading soybean and corn importers from Taiwan have ratified two letters of intent (LOI) to purchase soybeans and corn, two of Virginia's top commodity crops, in 2012 and 2013. Members of a Taiwanese agricultural trade delegation signed the LOIs earlier this week during meetings in Richmond hosted by Governor McDonnell, Secretary of Agriculture and Forestry Todd Haymore, the Virginia Soybean Association, and the Virginia Grain Producers Association.

Speaking to the Taiwanese delegation visit about the signed letters of intent, Governor McDonnell said, "Taiwan is an important export market for Virginia's agricultural products, purchasing nearly $50 million in farm products from the Commonwealth last year. Although Taiwan already ranks in the top 15 export markets for Virginia's agricultural products, there is the potential for a significant growth in Virginia exports to Taiwan. I look forward to the delegation's announcement translating into new sales and export growth opportunities over the next two years."

Through a letter of intent to purchase, the Taiwan Vegetable Oil Manufacturers Association expressed its plan to purchase up to 110 million bushels of U.S. soybeans, to include soybeans grown in Virginia, in 2012 and 2013. The Taiwan Feed Industry Association plans to purchase up to 413 million bushels of U.S. corn, to include corn grown in Virginia. Depending on market conditions, the combined value of these newly announced soybean and corn purchases by Taiwan from the United States could total up to $5 billion.

Agriculture and Forestry Secretary Haymore, who served as a signing witness to the LOIs, stated, "In discussions with the Taiwanese officials over the last year, the Governor and I focused strongly on increasing our agricultural exports to Taiwan. The letters of purchase intent present that opportunity for our producers, and we are grateful for the delegation's visit this week. Taiwan's selection of Virginia as the lead state for the visiting trade delegation serves to underscore the aggressive trade agenda that the McDonnell administration has undertaken to boost sales in the global marketplace."

Virginia was the first stop on a five state agricultural trade and goodwill mission for the delegation from Taiwan. In 2010, Taiwan ranked as the fourteenth-largest export market for Virginia agricultural products, importing $49 million worth of Virginia's farm and forest products. Virginia's top exports to Taiwan last year included soybeans, cotton, leaf tobacco, poultry, wood products, pork, and corn.

During the signing ceremony, Virginia's soybean exporters were represented by Dick Atkinson, Executive Director of the Virginia Soybean Association, and Virginia's corn industry was represented by Mrs. Katie Frazier, Executive Director of the Virginia Grain Producers Association. The organizations represent Virginia's soybean, corn, and grain producers. The farm sale value of Virginia soybeans, corn, and other grains exceeded $370 million according to the latest USDA figures.

"The Virginia Soybean Association is extremely proud of our state's producers and the efforts they put forth to supply products to the world," said Atkinson. "The Commonwealth and the present administration are working diligently to promote Virginia agriculture, and today's announcement is an example as we sign this letter of intent with the Taiwan Vegetable Oil Manufacturers Association how far these efforts have come. Soybean producers throughout the state will greatly benefit from these efforts."

Frazier added, "The Virginia Grain Producers Association, a farmer-led state commodity association representing corn and small grain growers of Virginia, was pleased to sign the letter of intent with the Taiwan Feed Industry Association to strengthen the long-standing trade relationship between Virginia corn growers and Taiwan. The Taiwan Feed Industry Association's intent to increase the amount of Virginia corn purchases speaks to the quality of Virginia corn, and provides Virginia's corn farmers with additional export markets."

Today's announcement marks the fourth agricultural trade deal secured since the Governor's trade and marketing mission to Asia in May. In June, Governor McDonnell announced that Virginia-based Smithfield Foods and China's Dandong Port Group had signed a memorandum of understanding (MOU) to explore commercial opportunities in northern China. Earlier this month, the Governor announced that Perdue Agribusiness, which owns and operates a major deep-water export terminal in Chesapeake, had reached agreements to begin exporting soybeans to the Dandong Port Group. The companies also signed an MOU to explore future business opportunities in addition to soybean exports. The Governor also announced in August a wine export deal between Barboursville Vineyards and China's Tianjin Tewoo Group.

Agriculture and forestry are Virginia's largest industries, with a combined economic impact of $79 billion annually: $55 billion from agriculture and $24 billion from forestry. The industries also provide approximately 500,000 jobs in the Commonwealth according to the Weldon Cooper Center for Public Service at the University of Virginia.

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