US corn exports are speeding up from an already strong pace, with a sharp decline in corn futures prices renewing a competitive edge against rival Argentina and reviving sales to South Korea, traders said.
Chicago Board of Trade corn futures have slumped more than 30 cents a bushel in the past two weeks, after pushing to 6-1/2-year highs, luring fresh demand from Mediterranean and Middle East buyers, who are also benefiting from a cooling in red-hot ocean freight rates.
"The pace of people inquiring after prices has increased," an exporter said. "Clearly, US corn has been ignored the last three to four weeks, but now that has changed because prices have come down in the United States and gone up in Argentina.
"There has been interest from the Middle East, Mediterranean and North Africa," he said. "They (Argentina) took away our business with their cheaper prices, and now the pendulum is swinging the other way," the exporter added.
This week alone, the US Agriculture Department said, exporters reported sales of 553,624 tonnes under mandatory rules to report sales of 100,000 tonnes or more to a single buyer in a single day.
Overall, as of April 15, export sales of US corn totalled 37.07 million tonnes for the current marketing year, which began Sept. 1, compared with 29.63 million tonnes at the same point a year ago, according to USDA data.
Bookings by South Korea a top market for US corn until 2000, when an unapproved genetically modified variety of US corns was found at food processors now total 1.6 million tonnes, compared with 207,800 at the same time a year ago.
"We are regaining market share in South Korea," said grains analyst Shawn McCambridge of Prudential Securities.
The increased sales to South Korea also come amid a slowdown in exports from its recent main supplier, China.
South Korean data showed the countries imports of feed corn from China for January-March totalled 804,572 tonnes, down from 1.4 million a year ago. Imports of US corn soared to 632,732 tonnes from 48,759 over the same period.
McCambridge also said he did not expect any serious competition from the emergence of non-traditional exporters, such as India and Indonesia, selling their surplus supplies.
Grain traders said a slowdown in farmer selling in Argentina and heavy export sales in recent months were behind a rise in corn prices in that country.
"They are not buying enough and they have a bunch sold," one trader said of Argentine exporters.
The trader also said China was the "wild card" in the world grain market as the country keeps silent on its corn export policy for 2004.
"I don't seriously think they are going to be a big seller of export corn," he said.
"But those guys (China) are good traders, they fool a lot of the people all the time," he added with a laugh.
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