The United States is losing its corn export market share to Brazil, Argentina and Ukraine. As the three biggest corn importers Japan, Mexico and Korea opt for the cheapest price.
The drought in the US sent grain prices up to record highs. And according to the US Department of Agriculture (USDA) Latin American countries are expected to increase their output by 5.9% this year.
According to a large feed miller in South Korea, Lee Tae Woong, general manager at Nonghyup Feed, South American corn is US$30 less expensive than US corn, plus they are producing more, whereas availability in the US is tight.
US corn supply accounted for 35% of Korean imports in 2012, the lowest since 2005 and down from 78% in 2011 and 85% in 2010, customs data show.
In Japan, US corn imports fell to 11.1 million tonnes in 2012, representing 74% of total purchases, data from Japan’s agriculture ministry show. Japan’s total corn imports dropped to 14.9 million tonnes last year, the lowest since 1986, according to the data.
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