November 18, 2004

US Corn Export Prospects Dampened by Surging Freight Costs

Despite a record crop and falling prices, US exports are projected to reduce by 500,000 tons this month due to softening demand.

Lower expected consumption in South Korea, slow recovery in the currency crisis in Egypt, as well as higher production in Turkey contributed to an 800,000-ton drop in imports in these markets. Higher imports by Algeria, Indonesia, and Peru are not enough to offset these drops. Moreover, US export prospects are being dampened by surging freight costs.

US barley and sorghum export estimates are also lowered this month. Unlike last year, the United States is not expected to capture any of Saudi Arabia's barley market due to intensified competition from Ukraine and the EU-25.