Process Management

News 400 views last update:6 Aug 2012

US corn exports to hit a new record

Corn exports from the United States are projected to reach a record 62 million tonnes in trade year 2007/08, up 2 million tonnes this month, according to the monthly outlook from the Agriculture Research Service of the American agriculture ministry USDA.

The US marketing year is also a record at 2.45 billion bushels, up 100 million bushels this month. The early-season pace of US corn sales and shipments has been strong, and reduced competition and strong demand are projected this month. Increased exports were the only change in projected US supply and use this month resulting in a corresponding 100 million bushel decrease in ending stocks.

Corn, sorghum, and barley prices were raised this month reflecting strong demand for grains. Projected prices for corn and barley are at record levels, surpassing their previous records in 1995/96.

Argentina keeps exports low
Argentina is the second largest exporter of corn and has a strong influence on US exports. Argentina's government has been keeping export registrations for corn closed, thereby limiting corn exports and keeping a lid on prices in Argentina.

The government of Argentina is expected to continue to use export registrations and export taxes to maintain higher stocks than the free market would otherwise dictate. No changes were made this month to forecasts for other major corn exporters, but China's corn exports are expected to be limited by concerns about internal prices, and most of Brazil's exports are expected to go to the EU-27, leaving the United States with limited competition in many markets.

Buying in advance
The early pace of US 2007/08 corn sales and shipments has been very strong. According to U.S. Census data, October 2007 corn exports were up almost 20% over those of the previous year. Export sales shipment data indicate November 2007 corn exports topped 6 million tonnes, up over 1 million from those of the previous year.

Moreover, at the end of November, outstanding export sales of corn reached 19 million tonnes, compared to 11 million tonnes a year ago. Census plus Exports Sales data indicate commitments up 10 million tonnes over those of a year ago. With exports forecast to increase only 6 million tonnes, importers are believed to be buying ahead more this year than last to assure supplies.

Global stocks reduced
World coarse grains consumption in 2007/08 is projected up 2.8 million tonnes this month to 1,056.4 million tonnes. Global corn use is forecast up 3.6 million tonnes to a record 766.4 million tonnes, but tight supplies are reducing prospects for barley consumption. In Canada, corn feed use is projected up 1.1 million tonnes due to increased corn production and reduced forecast feeding of barley and wheat.

Increased production is also boosting feed use of corn in Russia and Belarus. Strong reported feed demand in South Africa, also boosted consumption prospects for 2007/08. Corn feeding is also raised for Saudi Arabia, reflecting tighter world barley supplies. World coarse grain ending stocks for 2007/08 are projected down 2.3 million tonnes this month to 133.0 million tonnes. The largest decline, 1.3 million tonnes, is for corn, but barley, oats, and sorghum are also reduced. World coarse grain ending stocks are projected at the lowest level since 1977/78, when global use was less than two-thirds the use projected for 2007/08.

For the full December outlook of ERS click here 

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