U.S. corn exports projected for October-September 2006/07 were reduced 1.5 million tons this month to 55.5 million tons (the September-August local marketing year exports were reduced 50 million bushels to 2.2 billion). Reduced production reported this month and strong domestic demand, especially due to growing demand for corn to produce ethanol, are boosting corn price prospects. Sharply higher corn prices are expected to reduce the pace of U.S. corn exports during the second half of 2006/07.
The pace of U.S. corn sales and shipments has been robust during the first months of the year. Local marketing year exports got off to a rapid start of 5 million tons in September 2006, much higher than the previous year when Hurricane Katrina caused problems exporting from the Gulf. According to preliminary shipments data, during October 2006 corn exports were 4.5 million tons, about the same as a year earlier. According to U.S. Export Sales as of November 2, outstanding sales had reached nearly 12 million tons, up almost 60 percent from the previous year.
However, high U.S. prices and high freight rates are expected to slow U.S. corn sales. Foreign competitors have been encouraged by high prices, with noted recent sales by China and Brazil. Moreover, prevailing high prices are expected to discourage use in some foreign countries.
Projected 2006/07 October-September corn exports by Brazil were increased 1 million tons this month to 3 million. The recent shipping pace has exceeded expectations, and with stagnant poultry meat exports, more corn may be available to export as grain. Serbia's corn exports were increased slightly based on the pace of sales and shipments to the EU-25.
Projected 2006/07 corn imports were reduced 0.4 million tons to 8.5 million for South Korea, and reduced 0.3 million tons to 4.5 for Taiwan, partly because the 2005/06 trade data revealed lower-than-expected demand. Changes to other countries were smaller. World corn trade projected for 2006/07 was reduced slightly this month to 80.5 million tons, but preliminary trade data indicate global corn trade in 2005/06 reached a record 82.7 million.