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.

Several factors underlie the resurgence, including the largest-ever U.S. corn crop in 2012, meaning an abundant supply of competitively priced U.S. corn for buyers around the world. In recent months, the on-going political strife in Ukraine has also been a factor due to higher prices for Ukrainian corn and buyer concerns about reliability in the coming months.

"In the past, proximity and resulting freight advantage of Ukraine and other Black Sea-region corn has been a major reason for eroding U.S. corn market share in the region," said Cary Sifferath, U.S. Grains Council regional director of Middle East and Africa. But the balance has shifted. "Besides the revival of the Egypt market, we've seen buyers in Tunisia, Morocco, Algeria, Nigeria, Israel and Saudi Arabia purchasing U.S. corn this spring," Sifferath said. "And we've seen U.S. corn being shipped to EU destinations, as well."

Other major U.S. competitors in the region include Brazil and Argentina. Brazilian corn is currently being offered for July and August shipment. The United States has been competitively priced when compared with the new crop of Argentine, when assuming U.S. shipments from east coast ports. Some shipments have already arrived, while others will take place over the next three months. Importers in the Middle East and North Africa have expressed satisfaction with the quality of U.S. corn compared to corn previously imported from the Black Sea region.

"We have started to roll-out the positive findings in the 2013/2014 Corn Export Cargo Quality Report, which should lead to additional sales," Sifferath said.

However, Sifferath cautions that even with Ukraine's continuing geo-political issues and worries about timely delivery from South America – especially after major delays last year – he doesn't expect these tough competitors to disappear from the Middle East and North Africa.

"USGC staff and consultants will continue to meet with major corn importers and end-users to ensure U.S. corn, corn co-products and other feed grains remain top-of-mind when weighing future buying decisions," Sifferath said.