Brazil is well on its way to unseating the U.S. as the top corn exporter this marketing year, which ends Aug. 31.
USDA estimates Brazil could account for 30.2% of world corn exports for the 2022-23 marketing year while U.S. exports are on pace to fall to a multi-year low of 1.65 billion bushels, which accounts for about 24.8% of the world market, according to USDA’s latest world ag supply and demand estimates.
If realized, it would mark the first time Brazil has surpassed the U.S. in corn exports since the drought-riddled season of 2012.
Krista Swanson, lead economist at the National Corn Growers Association (NCGA), and Cary Sifferath, vice president of the U.S. Grains Council, discussed the market shift and outlook for U.S. corn exports during a recent webinar.
“U.S. exports have been hindered by droughts that have affected key areas of the Corn Belt,” Swanson said. “But the U.S. has several relative advantages in the global corn market than can be harnessed to support our $90 billion corn industry.”
U.S. corn production totaled just 13.7 billion bushels for the 2022-23 marketing year, 9% lower than the previous year due to drought in key corn-growing regions. U.S. corn prices subsequently increased, which along with a strong value of the dollar made corn sales less competitive on the world market.
This year, however, USDA predicts domestic corn production could rebound to a record 15.32 billion bushels despite the early-season drought while a small drop in Brazil’s corn production is forecast for the upcoming 2023-24 crop.
“While Brazil is positioned to surpass the U.S. in corn exports this year, the data do not indicate the trend leading to this development will necessarily continue,” Swanson noted in her white paper analysis of the two markets.
USDA estimates U.S. corn exports could jump back to 2.1 billion bushels in 2023-24, well above 1.65 billion this year but still off the pace of 2.47 billion bushels exported in 2021-22.
NCGA and USGC point to key corn production and infrastructure efficiencies in the U.S. compared to Brazil that put American farmers in the driver’s seat to reclaim their role as the world’s top corn exporter.
Meanwhile, in terms of shipping corn, Brazil is about 86% the size of the U.S. but has just 25% of the roadway miles compared to here. And, of those miles of roadway, only 12.4% are paved in Brazil compared to nearly 70% paved in the U.S.
“While the U.S. and Brazil have both increased productivity over time, global sustainability is an important consideration,” Swanson noted in the report.
Meanwhile, USGC continues to develop markets for U.S. corn, ethanol and distillers’ grains around the world, which should help support future exports, according to Sifferath.
“As we look to future markets, we see frontier markets in West Africa,” while India and Bangladesh have growing feed, livestock and aquaculture industries, Sifferath said. “We’re also growing exports in mature markets (such as Canada and Japan) in the form of ethanol.”
To keep expanding markets, NCGA has called on Congress to double funding in the farm bill for key trade programs, including the Market Access Program and the Foreign Market Development Program.
This story was distributed through a cooperative project between Illinois Farm Bureau and the Illinois Press Association. For more food and farming news, visit FarmWeekNow.com
Source: newsbug