In an effort to encourage local production and generate revenue for the national treasury, Syria has recently imposed import duties on corn and barley, the U.S. Grains Council has learned. The duties were originally set at $77/metric ton but have since been scaled back due to industry pressure. They are currently at $22/ton for corn and $44/ton for barley. According to Joe O’Brien, USGC regional director in the Middle East and Subcontinent, local importers and manufacturers of feed and starch products feared their products and exports would become uncompetitive as a result of the duties, giving impetus to smuggling. In response, they lobbied their government for a levy reduction. O’Brien said there is continued industry pressure to have these duties removed entirely. “Domestic production of both grains has been flat within the past few years as imports have increased,” he explained. “Local corn production in the past five years has varied from 125,000 tons to 200,000 tons. Harvested grains have been of poor quality with poor drying and storage. Production has not been able to satisfy the demand of around 2 million tons.” While the United States has lost market share in Syria, dropping from 80 percent to about 27.4 percent (494,000 tons or 19.4 million bushels) for corn in 2009, O’Brien reports that traders feel these new duties will not have much of an impact. Market intelligence has shown that any loss of U.S. market share in the country can be attributed to price, access to the Black Sea and attractiveness of smaller vessel purchases. According to O’Brien, Syria’s levies have not come as a complete surprise as the Syrian government has taken similar measures in the past. As Syria currently imports about 1.8 million tons (70.9 million bushels) of corn, the Council will continue to monitor the Syrian market and service customers in the country.

Written by Jodi Kiely, USGC Contributing Writer

Click here to read this week's Global Update