May 27, 2020

Rise in US corn exports expected despite pandemic challenges

The COVID-19 pandemic has affected corn use for both animal feed and ethanol, with these "areas of demand" likely to be observed closely "as they are intertwined," said Peter Meyer head of grain and oilseed analytics for S&P Global Platts.

"Prior to coronavirus outbreaks at packing plants, it was somewhat easy to add 200 to possibly 300 million bushels to US feed demand, given the lack of dried distillers grain production," Meyers told Successful Farming. 

"Now it's a bit more difficult, but not a lost cause. We still see a 5.6 billion to 5.7 billion feed and residual number, lower than the May WASDE report. For the 2020 marketing year starting on September 1, our forecast was as high as 5.8 billion bushels, before this unfortunate protein back up. But now, we need to reassess new crop corn supplies, as more data becomes available."

In a 2020/21 forecast, USDA/WASDE stated in its May report that estimated total US corn use could increase relative to a year ago with rising domestic use and exports. The use of corn as feed is projected to be higher than use for ethanol and reflects a larger crop and lower expected prices.

According to Successful Farming, the United States' corn exports in 2020/21 are forecast to rise 375 million bushels to 2,150 million, supported by growth in world corn trade.

US market share is expected to increase from the 2019/20 multi-year low, but remains below the average level seen during 2015/16 to 2019/20 with expected competition from Argentina, Brazil and Ukraine.

Meyer noted that "while ethanol demand is lower, and possibly feed," there is a potential for rising exports amounting to 1.85 billion bushels "against the current USDA estimate of 1.725 billion. 

"Cautious optimism would be our opinion on exports for both the current marketing year and the next one," Meyer said.

- Successful Farming