US Corn Exports On the Rise -BIMCO
Many agricultural trades have been exceptionally strong in 2021, and several grain types have experienced record high exports, says shipping industry organization BIMCO. U.S. corn exports are no exception, reaching a record high of 49.1 million tonnes between September 1 (when the marketing year started) and May 20. This is 77.6% higher than in the 2019/2020 marketing year which recorded exports of 27.7m tonnes and finished the season at 43.3m tonnes (September to end-May), a level already surpassed in this current season.
The previous record for exports between September and May was held by the 2016/2017 season when exports in the equivalent week of May stood at 41.9 million tonnes.
High outstanding sales setting current season up to finish as the best ever
Also performing strongly are outstanding sales for this season which, although no guarantee for upcoming exports, provide a good indication. These currently stand at 14.6 million tonnes which, if all the volumes sold are exported, would bring total exports this season to 68.6 million tonnes, considerably higher than the 2016/2017 marketing season which currently holds the record at 57.5 million tonnes. At this point in the previous marketing season, outstanding sales stood at 12.1 million tonnes, slightly lower than what was exported between May 20, 2019 and the end of that season: 15.6 million tonnes.
Exports to China fully recovered from trade war lows
At this point last season only 190,600 tonnes of corn had been exported from the U.S. to China. This year that number has skyrocketed to 13.6 million tonnes as Chinese buyers stock up on U.S. grains and send the number of Panamax ships (75,000 tonnes) needed for this trade from around three to 182.
Higher exports to China are the primary reason for the 77.6% growth in total U.S. corn exports so far this season, with China taking the top spot.
Two other destinations dominate U.S. corn exports: Mexico and Japan, and along with China, the three combined account for 75% of total U.S. corn exports. Exports to Mexico and Japan have reached 10.6 million tonnes (up 4.2% from last season) and 7.9 million tonnes (+28.5%) respectively and 11.2 million tonnes have been exported to the rest of the world since September 1, 2020, up just 0.2% from last season.
“After years of disruption to the U.S.-China corn trade due to the trade war, Chinese buyers have well and truly established their dominance this season, putting in large orders, not only to ensure enough feedstock, but also stock building, and an effort to make good on the stipulations in the Phase One Agreement,” said Peter Sand, BIMCO’s Chief Shipping Analyst.
“For shipping this is great news; not only are overall volumes higher than they have ever been, so are sailing distances with both China and Japan providing much longer sailing distances than the other top buyer Mexico, as well as other buyers in South and Central America and Europe,” Sand said.