North Africa: What a Difference a Year Makes

Tom in meetings in North Africa

“A year ago, North Africa was dropping off the charts in terms of U.S. corn sales,” said U.S. Grains Council President and CEO Tom Sleight. “But this year, Egypt may take more corn (whole grain) than China, and Morocco and Tunisia are again buying U.S. corn.”

For the current marketing year that began Sept. 1, 2013 through May 15, Egypt, Morocco and Tunisia have taken a combined 2.1 million metric tons (82.7 million bushels) of U.S. corn (accumulated exports plus outstanding sales), compared to nothing over the same period last marketing year.

Uncertainty in Ukraine Drives up Grain Prices

As farmers in the Ukraine enter the planting season for corn and wheat, a cascade of issues including limited financing, a devalued currency, political uncertainty and mounting tension with Russia have made buyers cautious about Ukrainian grains. In recent months, the expected prices of both corn and wheat have increased significantly reflecting risk in the market.

Planting conditions for corn and wheat are favorable in the Ukraine, as heavy rains followed by dry conditions have led to good soil moisture. However, financing has become an issue for many Ukrainian farmers as rejections and high interest rates are making it difficult for them to purchase needed materials.

Water Constraints to Boost Saudi Feed Imports

The Almarai Company, Saudi Arabia’s largest dairy company and third largest poultry company, has announced plans to stop domestic cultivation of forage and rely entirely on imported feed. This move is in response to anticipated new governmental restrictions on water usage, as the country’s economic and population growth continues to overtax available water resources.

“Almarai has been a strong and consistent purchaser of U.S. corn, often paying a premium for U.S. origin corn,” said Cary Sifferath, U.S. Grains Council regional director of the Middle East and Africa. “The company already imports 100 percent of its feed grain needs for milk production."

Council Expanding Market for US DDGS

DDGS

U.S. distiller’s dried grains with solubles (DDGS) have gained popularity in markets around the world, with 9.7 million metric tons – valued at $2.9 billion – exported in 2013 to more than 45 countries. Behind this market expansion are Council-directed and implemented educational seminars and feeding trails, complimented by consistent end-user contact and support. In emerging markets around the world, the Council continues to work to expand the market for U.S. DDGS.

While Mexico is the third-largest market for U.S. DDGS, its southern region remains an underserved livestock sector with growth potential for U.S. exports. According to a 2012 Council assessment, the potential exists to more than double current exports by providing technical and practical education to local cattlemen. To further this effort the Council has conducted a feeding trial in the area.

US Steadily Regaining Market Share in Israel

Israel imports of U.S. Grains

Each year, Israel imports between 2.4 and 2.5 million metric tons of feed grains. The product mix of corn, feed wheat, barley, sorghum, oats and rye changes year-to-year, depending on prices for delivery to Israeli ports from various points of origin in the region.

In recent years, Ukraine and Russia – among other Black Sea sources – have dominated the Israeli market for corn, feed wheat and barley due to proximity and resulting freight advantage over the United States and South America.

US Corn Exports to Middle East and North Africa Continue Upward Trend

After two consecutive years of low market share for U.S. corn exports to the Middle East and North Africa, the 2013-14 marketing year has seen a sharp rebound in U.S. corn sales and shipments to the region. From the beginning of the marketing year through April 10, outstanding sales and accumulated exports of U.S. corn to North Africa and the Middle East are more than 2.8 million metric tons (110 million bushels), up from 204,500 tons (8 million bushels) the previous year over the same time period.

Middle East and North Africa Shifting Corn Demand to US

outstanding sales and accumulated exports of U.S. corn to North Africa and the Middle East - See more at: http://grains.org/index.php/chart-of-the-week/4581-middle-east-and-north-africa-shifting-corn-demand-to-us#sthash.g2WWdaOj.dpuf

This week's U.S. Grains Council Chart of the Week shows outstanding sales and accumulated exports of U.S. corn to North Africa and the Middle East for the past three marketing years, which began Sept. 1, through Mid-April for each listed year. With U.S. corn returning to more normal pricing in the 2013/2014 marketing year, Egypt, Israel, Morocco and Algeria have all returned to purchasing U.S. corn. Also, Tunisia has once again begun sourcing corn from the United States.

The MENA Region: Expanding Council Presence

The MENA Region: Expanding Council Presence

By: Cary Sifferath, U.S. Grains Council Regional Director in Middle East and Africa

With U.S. corn and corn co-products priced competitively again, U.S. market share in the Middle East and North Africa region has begun to expand. For examples, Saudi Arabian buyers have begun purchasing U.S. corn and corn co-products again; Egyptian importers have purchased 638,000 metric tons (25.1 million bushels) of U.S. corn for April, May and June shipments on top of the 160,000 tons (6.3 million bushels) that was shipped in December and January; and there have been strong sales of U.S. corn co-products to Turkey, Egypt and Morocco.

The Only Place to Go is Up: Moroccan Feed Mill Industry

Moroccan Team - Feltis Farm

By: Cary Sifferath, U.S. Grains Council Regional Director of the Middle East and Africa

The U.S. corn market share in Morocco fell to zero this past marketing year as a result of high U.S. prices due to the drought and strong competition from South American origin corn. Consistent customer servicing in Morocco is necessary to regain Moroccan confidence and create demand for U.S. corn.

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