Lower Prices Stimulate World Corn Import Demand

A record corn crop in the United States and large exportable supplies in Brazil, Argentina, and Ukraine are hanging over the world market—causing export prices to tumble from peaks seen last summer. Lower prices are stimulating global import demand, and the United States is competitively positioned to supply much of that demand. U.S. exports are estimated to more than double from last year.

A seasonal window of opportunity favors U.S. corn exports as competitors face price and logistical challenges. Brazilian corn shipments are expected to slow seasonally as the country shifts to exporting a record soybean crop. In Argentina, government policies and foreign exchange concerns have so far limited new-crop corn sales. Meanwhile, Ukrainian prices are relatively high in the near-term as seasonal logistical problems restrict its competitiveness. However, with a record crop, record exports are still forecast.

Recent U.S. corn export sales have been robust. In traditional Asian markets, the United States has rebounded as the dominant supplier, reflecting its comparative advantages in price and freight. Sluggish Argentine sales and shipments have created opportunities for the United States in South America. Additionally, U.S. corn is currently competitive into Egypt and Spain. Lower corn prices have also stimulated a surge in U.S. commitments to Mexico, up over 5.0 million tons, as sorghum has become uncompetitive.



Global production is down slightly, as a smaller crop in Kazakhstan more than outweighs greater production in Brazil and Ukraine. Trade is nearly unchanged. Larger exports from the EU and the United States are expected to offset smaller shipments from Argentina, Kazakhstan, Australia, and India. The season-average farm price is unchanged.


Domestic: Prices by-class were mixed over the month, but have spiked in recent days on reports of poor crop conditions in parts of the U.S. Plains. Hard Red Winter was up $4 to $295/ton. Soft White Wheat (SWW) rose $9 to $281/ton, Soft Red Winter (SRW) dropped $5 to $267/ton, and Hard Red Spring (HRS) surged $27 to $345/ton. (HRS) prices peaked at $367/ton mid-month due to weather-related slowdowns.


Selected Exporters

• Argentina is slashed 1.0 million tons to 2.0 million, the smallest in 40 years, as the government has authorized only limited exports to date.

• Australia is down 500,000 tons to 18.5 million based on slow early-season shipments.

• European Union is boosted 1.5 million tons to 27.5 million with continued strong sales as reflected in export licenses.

• India is cut 500,000 tons to 5.5 million as its exports are not expected to be competitive later in the year.

• Kazakhstan is down 1.0 million tons to 7.0 million based on a smaller crop.

• United States is up 1.0 million tons to 31.5 million supported by vigorous sales.

Selected Importers

• European Union is cut 500,000 tons to 4.0 million as imported corn displaces some wheat in feed rations.

• Iran is raised 500,000 tons to 5.0 million on reported purchases of EU wheat.

• United States is boosted 300,000 tons to 4.5 million, a record, on the strong pace of imports from Canada.



The global situation for 2013/14 is virtually unchanged from last month. Production and trade are still records.


U.S. medium grain prices have surged over the past month to levels unseen since August 2009 because of tight supplies and concerns about water availability in California. The current difference between U.S. medium and long grain, over $345/ton, is the largest in almost three years. Medium grain exports are forecast marginally higher than last year as global supplies are tight. The United States exports roughly half of its medium grain production.


• Bangladesh’s 2014 imports are lowered 130,000 tons to 300,000 on ample domestic supplies and uncompetitive prices from India, the major supplier.

• Vietnam’s 2013 exports are cut 400,000 tons to 6.8 million, while Pakistan’s are boosted 200,000 tons to 3.5 million, both on trade data.

• Nigeria’s 2013 imports are dropped 200,000 tons to 2.6 million on trade data, while Madagascar’s imports are raised 100,000 tons to 350,000.



Although Argentina’s corn crop is lowered, world production is little changed. Global corn trade is boosted because of strong feed grain demand, evidenced by brisk U.S. sales to both key Asian and non-traditional destinations. The U.S. corn export estimate is boosted sharply and the season-average farm price is raised.


Since the release of the January WASDE report, U.S. corn quotes have climbed steadily on tighter supplies, strong export sales, and internal logistical problems caused by snow and cold weather. By month’s end, export quotes had gained $10/ton since mid-January, and were close to $220/ton by early February. U.S. corn remains very competitive, although Argentine prices have fallen as new-crop availability looms.


Selected Exporters

• U.S. corn is up sharply by 4.0 million tons to 41.0 million on strong sales and competitive prices.

• Argentine corn is cut 1.0 million tons to 13.0 million based on a smaller crop and slow new-crop sales.

• Indian corn is down 500,000 tons to 3.0 million because of strong domestic demand and uncompetitive prices.

• Russian corn is up 500,000 tons to 3.0 million on a torrid pace of shipments.

• South African corn is cut 200,000 tons to 1.7 million as old-crop supplies tighten.

• Thai corn is more than doubled to 500,000 tons because of government support programs that include export incentives.

• Ukrainian corn is up 500,000 tons to 18.5 million based on a larger crop and strong first-quarter shipments.

• Australian and EU barley are raised to 5.0 million tons and 4.5 million, respectively, because of higher demand from the Middle East and North Africa.

Selected Importers

• Egyptian corn is boosted 500,000 tons to 6.2 million on strong first-quarter shipments.

• EU corn is raised 1.5 million tons to 10.5 million on the rapid pace of import licenses. Conversely, exports are cut 500,000 tons to 2.5 million as export licenses have slowed.

• South Korean corn is up 500,000 tons to 9.5 million as relative prices improve corn’s competitiveness against wheat for feeding.

• Mexican corn is boosted 500,000 tons to 11.5 million as corn becomes more competitive relative to sorghum, which is halved to 500,000 tons.

• Vietnamese corn is raised 400,000 tons to a record 2.0 million because of recent strong imports from Brazil (instead of India), robust feed demand, and reduced imports of DDGS from the United States.

• Chinese sorghum is up 500,000 tons this month to 3.0 million based on purchases and shipments from the United States