What is in this article?:
- Corn production, exports heating up
- U.S., China changes similar
• In 2000, the U.S., Brazil, and Argentina accounted for nearly 84 percent of world corn exports, with China making up another 9 percent. These four countries were responsible for 93 percent of the world exports of corn. It took 33 other countries to make up the remaining 7 percent of world corn exports.
• By 2011, these four — U.S., Brazil, Argentina, and China — were responsible for only 70 percent of world exports with Brazil and Argentina posting small gains in their share of world exports, 1.3 and 2.1 percentage points respectively.
U.S., China changes similar
Most of the increase in U.S. corn output went for domestic ethanol production. Similarly, domestic factors drove change in China as well. A large portion of China’s increased corn production was used for food and feed.
In the case of the U.S,. it is doubtful the increased use of grain for ethanol prevented the filling of a large number of export orders. Rather the higher corn prices provided encouragement for other countries to increase corn production and thereby increase export competition for the U.S.
There was a time when the U.S. had the corn export market locked up, with everyone else playing a minor role. Over the last decade or so, U.S. farmers and commodity traders have had to pay more attention to South American corn production, particularly Brazil and Argentina. Today that view has to include countries in Europe, Asia, and Africa as well.
As multi-national agribusiness firms have begun selling corn seed with top-notch genetics to farmers around the world, the list of competitors has increased dramatically. This is reflected in the increase in non-U.S. yields from 50.1 bushels per acre in 2000 to 65.1 bushels per acre in 2011, a 30 percent gain. Comparing those yields to U.S. yields in the 150-165 bushel per acre range, we have an indication of the potential competition U.S. farmers may face in world export markets over the next couple of decades as these countries bring their yields closer to U.S. levels.
With the collapse of the Soviet Union, breadbasket countries whose trade was limited to the Soviet sphere are now free to participate in world agricultural commodity markets. They are also able to access the management systems, equipment, and seed technologies they were previously denied. As a result agricultural production is booming in some of these countries.
Looking at these numbers, one is apt to conclude that, “If it were not for the over 5 billion bushels of domestically produced corn to produce ethanol in the U.S., the U.S. corn production sector would be a lot smaller and much less prosperous.
Daryll E. Ray holds the Blasingame Chair of Excellence in Agricultural Policy, Institute of Agriculture, University of Tennessee, and is the Director of UT’s Agricultural Policy Analysis Center (APAC). Harwood D. Schaffer is a Research Assistant Professor at APAC. (865) 974-7407; Fax: (865) 974-7298; email@example.com and firstname.lastname@example.org; http://www.agpolicy.org.