WORLD MARKETS AND TRADE :

COMMENTARY AND CURRENT DATA

MONTHLY HIGHLIGHTS: See PDF version for charts

Supplies in Key Corn Suppliers Revised Up this Month: Competitor crops for 2006/07 (Argentina, Brazil, Ukraine) were raised 3.5 million tons and Canada's crop was raised 500,000 tons, resulting in 4 million tons of additional global supplies and a 1.4-million-ton gain in world trade. Production estimates for Argentina and Brazil, both old and new crop corn, were raised over 4 million tons this month, adding 1.7 million tons to their exports in 2006/07.

World Rye Trade Continues to Shrink: World rye trade is forecast to fall to a 25-year low this year as EU exports are revised down again this month. With high domestic rye prices and the Commission selling supplies onto the domestic market, sales for export have been slow. EU intervention stocks have fallen from 5 million tons just a few years ago to less than 500,000 tons currently.

PRICES:

Domestic: November export bids for #2 yellow corn again soared by over $20 per ton to $164, the highest in over 10 years. The escalation continues with strong domestic and foreign demand, and slack competition from China and Argentina.

• Australia barley is lowered 400,000 tons to 2.3 million on reduced exportable supplies. Carryin stocks were revised down this month in light of a recent survey from the Australian Bureau of Statistics.

• Argentina corn is up 1.0 million to 12.0 million because of a higher new crop production forecast and a revised old crop estimate.

• Brazil corn is raised 500,000 tons this month to 3.5 million because of larger new and old crop supplies and a fast export pace to date.

• Ukraine corn is up 200,000 tons to 2.0 million. Greater supplies will likely result in higher exports, despite government action to restrict licenses.

• EU-25 corn is slashed 350,000 tons to 150,000 (and imports are raised) with high domestic grain prices.

• Ukraine barley is lowered 400,000 tons to 4.3 million as government export policy has reduced shipments in recent months.

• Canada corn is cut by 500,000 tons to 2.3 million because of a larger crop.

• South Korea corn is up 300,000 tons to 8.8 million based on greater supplies from Argentina and Brazil.

• EU-25 corn is raised 500,000 tons to 3.5 million based on the pace of import licenses. This is nearly triple from last year and the accession of Bulgaria and Romania will likely increase corn trade to the EU-25.

• Iran barley is down 200,000 tons to 600,000 and Israel, Libya, and Syria are each down 100,000 as a result of very high global barley prices and reduced availability from major suppliers.

• Mexico sorghum is down 200,000 tons to 2.7 million, the lowest in 10 years, due to the slow pace of purchases and shipments from the United States.

• EU-25 sorghum is up 100,000 tons to 325,000 due to the fast pace of import licenses and purchases from the United States.

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Last modified: Monday, December 11, 2006