Brazil’s rising corn exports challenge U.S. dominance

The United States’ dominance in corn exports is fading as Brazil emerges as a formidable competitor.

Brazil’s new supply agreement with China and advanced seed technology position it to surpass the US in corn exports for the second time this season.

Additionally, Mexico, a major market for the US, is preparing to restrict imports of genetically modified corn, which makes up over 90% of US corn crops.

This decline in market share poses a significant challenge for the US$90 billion US corn industry, as domestic demand for livestock feed and ethanol production has cooled.

This situation mirrors the challenges the US faced in soybean exports a decade ago when Brazil became the leading supplier.

Brazil dominates the global soybean export market most of the year, undercutting US exports. Brazil also leads in exporting poultry, coffee, and sugar.

China’s expanded approval of Brazilian corn export facilities revitalized shipments from Brazil, while US corn exports to China have dropped by 48%.

Chinese buyers anticipate a plentiful supply of inexpensive Brazilian corn in the coming months.

The price difference makes it difficult for the US to compete.

Total US corn export sales hit a record low, and the strong dollar further makes US products expensive for international buyers.

Mexico has provided some relief for US corn exports, but a dispute over Mexico’s ban on certain biotech corn imports poses a risk.

US corn exports for the current marketing year are estimated to be the lowest in a decade, while Brazil’s exports are projected to be a record 55 million tons.

Brazil’s rapid growth in corn production has offset Ukraine’s lost exports due to Russia’s invasion.

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