COARSE GRAINS: WORLD MARKETS AND TRADE
Corn-Squeezed by Feed Quality Wheat? As the record U.S. corn crop gets larger every month, so too does the world's supply of feed quality wheat. Canada's deteriorating wheat crop means that more wheat will be pushed into domestic feed, displacing demand for U.S. corn. Furthermore, while Canada's total wheat exports are expected to decline, there will be more feed quality wheat exported to South Korea, where it will likely replace U.S. corn. As a result, total U.S. corn exports are reduced by 500,000 tons to 52.5 million this month.
EU Barley-A Former Heavyweight Back In the Ring After more than a year without export subsidies, the EU Commission decided last week to reinstate targeted subsidies on October 14 for 1 million tons to the Middle East and North Africa regions. The timing of the newly announced export regulation could be an attempt to bolster domestic prices and thereby forestall large-scale sales into intervention stocks when they open November first. Although the level of subsidy remains to be seen, subsidized exports could mean heightened competition in these regions. Australia and Canada are both likely to lose some market share there, leaving Ukraine, Russia, and the EU as the main competitors.
Domestic: September export bids for #2 yellow corn averaged nearly $98/MT, down $6 from August. Prices continue to fall because of harvest time pressure and prospects for a massive crop. (See PDF version for chart)
September export bids for #2 yellow sorghum (Texas Gulf) averaged nearly $98/MT, down nearly $4 from August and $11 below year-ago prices. Sorghum is about even with corn at this time in contrast to a $6 premium last September. Average monthly corn export bids have dropped $25 per ton since June but only $18 for sorghum.
TRADE CHANGES IN 2004/2005
TRADE CHANGES IN 2003/2004
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