Major North African grains buyers have begun importing U.S. corn again thanks to better prices and facilitated by strong relationships maintained through the lean years with the U.S. Grains Council. After virtually no sales in the previous year, Egypt, Morocco and Tunisia purchased 2.1 million metric tons (82.7 million bushels) of corn this marketing year from September 2013 to May 2014.
Record Prices and Shipping Advantages
Following a record drought, the United States suffered from a shortened supply and high prices for the 2012/2013 corn crop. As conditions returned to normal this year, prices decreased to levels more competitive with Black Sea and South American corn producers, making U.S. corn an option again for many importers. The high prices in Ukrainian corn due to unrest in the country also factored into North African grain buyers’ decision to return to U.S. corn.
Many in the North Africa region purchased U.S. corn again because of the availability of shipping from the U.S. East Coast. Shipments out of Norfolk, Virginia, (instead of New Orleans, Louisiana) gave these countries a more direct route, retaining quality and reducing shipping time.
Maintaining Relationships and a High Level of Service
Prices are only one factor in the decision to return to U.S. grains, however. Strong relationships forged over many years also brought importers back to U.S. corn, as most who purchased the crop this past year have participated in Council programs for more than a decade. In Egypt, the service and quality offered by the United States made them want to buy U.S. corn again this year. From January through April, Egyptian buyers purchased 40 percent of their total corn imports from the United States, a close second to the 43 percent purchased from the Ukraine.
“U.S. corn is considered the standard for Egypt key importers, processors and consumers,” said Hesham Hassanein, USGC marketing manager in Egypt, “They prefer the quality, trust the consistency, reliability, and transparent pricing mechanism, and have confidence in FGIS (Federal Grain Inspection Service) quality and grading certification. Add to the above the unmatched service by both the U.S. trade and by trade associations such as the Council, and you are looking at a premium commodity.”
Keeping customers informed about the quality of U.S. corn allowed them to make an informed buying decision. The Corn Harvest Quality Report and Corn Export Cargo Quality Report issued by the Council gave buyers in the region a convenient way to evaluate the quality of corn in the United States from harvest to shipment.
“We’ve been using these reports and presenting the information on a regular basis to the major customers across North Africa, including Egypt, to make sure that they understand that the U.S. does have very good corn quality this year,” said Cary Sifferath, USGC regional director for the Middle East and Africa. “That has definitely brought some confidence in the buyers back to United States.”
Buying corn from the United States once again became an option for grains importers in North Africa and Egypt because of the competitive pricing, quality and service offered to customers. The Council sought to maintain the strong relationships it has developed in the region over the years, keeping these countries informed about the benefits of U.S. corn.
About the U.S. Grains Council
The U.S. Grains Council develops export markets for U.S. barley, corn, sorghum and related products including distiller’s dried grains with solubles (DDGS) and ethanol. With full-time presence in 13 key markets and representatives in an additional 15 locations, the Council operates programs in more than 50 countries and the European Union. The Council believes exports are vital to global economic development and to U.S. agriculture’s profitability. Detailed information about the Council and its programs is online at www.grains.org.