February 7, 2013
Brazil surpasses US in corn exports
Brazil, which is expected to overtake the US in soy exports, has already beaten it in corn shipments, marking its rise as an agricultural giant.
The 3.4 million tonnes of corn which Brazil shipped in January extended a shipment spree which trounced its previous record for a calendar year, of 10.9 million tonnes set in 2007.
Exports were supported by a record safrinha, or second, crop planted as a follow-on in fields cleared by the soy harvest, and which enjoyed unusually benign growing conditions last year.
It appears that the USDA's 21.5 million-tonne estimate for Brazilian corn shipments in Brazil's 2011-12 crop year, which ends this month, "is understated by 2-3 million tonnes", Richard Feltes at RJ O'Brien, the Chicago-based broker said.
"It looks like Brazil for first time will displace US as the world's number-one corn exporter."
"In fact, it has already happened," Feltes said- if on the basis of comparing 2011-12 data for Brazil for the 2012-13 season for the US, whose exports are being depressed by last year's dismal harvest.
That is not the stretch in accounting that it may appear, given that Brazilian season and US crop years, which start in September for corn, overlap by six months.
The coincidence of an unusually strong safrinha crop with such a poor one in the US, which recorded its lowest corn yield in 17 years, led to this scenario.
However, its improving trade muscle does "highlight an important shift, where the likes of Brazil are becoming major corn exporters," challenging America's historic dominance.
"They are far more aggressive in pricing corn for export than the US."
This is shifting custom from the US which may not return, even when the country's yields resume their historic improving trend and harvests improve- at a time when demand growth from ethanol plants has levelled off.
The dynamic also places Brazil at the pinnacle of world supplies in yet another agricultural commodity, after gaining top rank in coffee, orange juice and sugar exports.
The country is also the top chicken meat exporter, and was the top beef shipper before being overtaken by India last year, and a major source of cotton supplies. And it is poised to overtake the US in soy shipments too- once the current harvest begins in earnest.
Indeed, Brazil's corn shipments could yet stay strong, if rains continue to delay the soy harvest and hamper deliveries to ports.
