December 14, 2004

US Corn Falls; Regains Egypt's Market Share

Despite falling prices, the estimate for US corn exports is reduced by 1.0 million tons to 51.0 million, on the basis of easing import demand and greater competition from Ukraine. Mexico's imports are expected to drop by half a million tons. Canada and South Africa's imports are decreasing by 100,000 tons each, all as a result of larger local supplies. Although US Gulf export bid prices have reached a two and half-year low recently, the abundance of global feed grains and soaring freight costs are curbing US corn export prospects, as evidenced by the lagging commitments compared to a year ago.

US corn exports to Egypt rebounded in 2003/04 to 85 percent after a dismal performance a year earlier, when high US prices and strong competition from Argentina reduced US market share to an uncharacteristically low 60 percent. Maintenance and expansion of US exports there will depend on the recovery in Egypt's poultry sector, which has contracted during the country's currency crisis.