March 28, 2014

 

UK lifts corn imports estimates to record high

 

 

Putting the country alongside the likes of Morocco and Vietnam in its buy-in volumes, the UK upgraded further its estimate for corn imports to a record high, and raising questions over the size of last year's wheat harvest.

 

The Department for Environment, Food and Rural Affairs (DEFRA), hiked by 284,000 tonnes to 2.01 million tonnes its forecast for corn imports in 2013-14, putting them well ahead of last year's 1.69 million tonnes.

 

The upgrade represented the second by DEFRA, which had initially expected a decline in imports this season from a high last year prompted by the poor quality of the 2012 domestic wheat crop, much of which was not deemed suitable for feed use except through mixing with higher quality grain.

 

However, the revision to the corn import forecast had been on the cards after monthly data showed them continuing to exceed expectations, topping 300,000 tonnes a month for the first time in December, and exceeding this figure again in January.

 

The upgrade "reflects the high levels of imports seen for the season so far", the Home Grown Cereals Authority (HGCA) said, flagging the elevated import volumes.

 

"Further large shipments are expected in February/March, with imports forecast to tail-off later in the season."

 

The forecast implies imports averaging roughly 280,000 tonnes for the final five months of 2013-14. In fact, the upgrade was larger than expected by some traders that Agrimoney.com had spoken too, who had forecast a figure of about 1.8-1.9 million tonnes.

 

However, the HGCA highlighted follow-on exports of corn from the UK to Ireland, which are fuelling a forecast tripling in shipments to 218,000 tonnes for this season.

 

The growing popularity of corn as a feed grain has been confirmed in official data showing it rising to 11% as a component in the average compound feed, encouraged by its discount to feed wheat.

 

Feed use accounts for the majority of UK corn use, expected at 1.22 million tonnes this season, nearly double historic rates.

 

However, while the discount is in part attributed to the increased supply of corn from Ukraine, on Europe's doorstep - and from which there are no reports yet of export hiccups thanks to the Crimea crisis - there are thoughts that another dynamic may be involved too.

 

Given the poor quality of the 2012 harvest, and the low level of last year's crop, the apparent dearth of supplies may also be down to "people being more conscious of security, and not running on minimum stocks as they might have done in the past," the source said.