WORLD MARKETS AND TRADE :

COMMENTARY AND CURRENT DATA

MONTHLY HIGHLIGHTS:

Corn: Although U.S. exports have recovered somewhat in recent weeks from their earlier lassitude, total shipments to date are not on pace to meet the previous 50-million-ton forecast. In particular, exports to Canada and Mexico have slowed. With the approaching harvest of a record crop and anticipated lower prices, some outstanding sales could be switched to later delivery, further depressing the current year's export program. (See PDF version for charts)

Barley: Ukraine's largest harvest in 10 years is expected to propel the country to become the world's second largest exporter after Australia. Ukrainian barley is expected to dominate the Middle East, a key feed barley market traditionally covered by the EU. Without subsidies, EU exports cannot compete with the cheaper Black Sea supplies.

PRICES:

Domestic: Early August export bids for #2 yellow corn averaged $103/MT, down $2 from July and about the same as last September's price. Slight weather concerns and improved exports have reversed the slide in recent weeks. (See PDF version for chart)

Early August export bids for #2 yellow sorghum (Texas Gulf) averaged about $101/MT, up nearly $2 from July but $8 below harvest time prices from September 2003. Sorghum is at a $2 discount to corn, versus nearly a $6 premium last September. Price weakness caused by harvest activities in Texas and rapidly dropping corn prices have been offset to a degree by early-season sorghum exports to Mexico.

TRADE CHANGES IN 2004/2005

Selected Exporters

• Brazil corn drops by 300,000 tons to 3.2 million as a smaller winter crop raises prices and reduces competitiveness.
  
• Bulgaria, Romania, and Serbia corn each increases by 200,000 tons based on improved crop prospects.
  
• Canada barley is up 300,000 tons to 2.1 million due to a larger crop.
  
• Ukraine barley expands by 500,000 tons to 2.8 million based on the largest crop in 10 years.
  
• EU-25 barley is lowered by 700,000 tons to 1.8 million in light of stronger competition from Ukraine and the current absence of export subsidies.

Selected Importers

• South Korea corn drops by 200,000 tons to 9.1 million on the expectation of higher purchases of feed quality wheat.
  
• Russia corn is raised by 100,000 tons to 600,000 based on higher domestic demand.

TRADE CHANGES IN 2003/2004

Selected Exporters

• United States corn falls 1.0 million tons to 49.0 million based on slower-than-expected shipments.
  
• Brazil corn is up 300,000 tons to 5.3 million due to a strong shipment pace in recent months.
  
• Thailand corn increases by 300,000 tons to 900,000 as a result of lower domestic consumption brought on by new cases of Avian Influenza.
  
• Kazakhstan barley is up 200,000 tons to 700,000 based on newly available trade data.
  
• Canada rye is up 50,000 tons to an 8-year high of 150,000 with strong recent shipments to the United States and Japan.
  
• Russia rye is down 100,000 tons to 100,000 due to weak sales pace.

Selected Importers

• Canada corn decreases by 200,000 tons to 1.8 million based on a slower-than-expected pace in recent months.
  
• Egypt corn drops by 200,000 tons to 4.0 million because of continued foreign exchange woes.
  
• Israel corn is up 200,000 tons to 1.5 million based on a strong pace.
  
• Mexico corn declines 200,000 tons to 6.1 million due to a weak pace.
  
• Japan rye is up 75,000 tons to 325,000 due to larger-than-expected imports from Canada.

Note: Due to large discrepancies between the timing of reported EU-25 rye exports, and reported South Korean and Japanese imports, revisions were made to the EU-25 export estimates for 2002/03 and 2003/04. The EU-25 number now reflects time of arrival in these countries.

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Last modified: Thursday, November 13, 2003