Feed Grains Demand: Our Best Overseas Customers
In-depth look at the changing nature of global grain demand.
Compiled by staff
Published: Apr 13, 2009
U.S. corn importing countries are a combination of steady customers and transitional ones that become important and then fade away.
In 1975/76, the European Union (EU-15) was the largest market for U.S. corn at 670 million bushels, followed by the former Soviet Union with 390 million bushels and Japan at 210 million bushels.
The EU-15 market quickly declined to a 150 million bushel market by 1985, and the EU-27 (Europe has expanded to include 12 more countries since 1985) purchased only 6 million bushels in 2007-08. Soviet Union purchases declined to 270 million bushels by 1985 and then faded away.
Japan has grown to be the leading U.S. market for corn at 600 million bushels per year. The second largest market in 2007/08 was Mexico at 375 million bushels compared to purchases of only 40 million bushels in 1975. South Korea was the third largest market in 2007/08 at 330 million bushels, much higher than the 150-250 million bushels purchased in recent years.
"They are likely to substitute cheaper EU feed wheat this year," says trade analyst and economist Ross Korves.
Next was Taiwan at 150 million bushels and Canada and Egypt at 120 million bushels each. Canada's imports in 2007/08 were up from recent years, while Taiwan and Egypt were down.
Economic development
U.S. customers vary by their level of economic development. In 2007/08 developed countries accounted for about 35% of U.S. corn exports, middle income developing countries and those with petroleum resources accounted for 50%, and lower income developing countries were 15%. Those middle income developing and petroleum countries will likely have the greatest opportunities for further market growth.
The record U.S. corn exports for 2007-08 were driven by a group of countries, and the EU, that currently imports very little U.S. corn. The EU had back-to-back smaller than average wheat crops in 2006 and 2007. Almost half of the wheat consumed in the EU is fed to livestock.
For 2008-09 the EU is expected to have a net reduction of 26 million metric tons (MMT) in trade, as total world trade in wheat and coarse grains declines by 10 MMT.
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Tagged: wheat, Bushel
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