Aug 02, 2010
Brazilian Corn Exports Accelerate Due to European Demand
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
The ongoing drought in Eastern Europe has European importers looking more toward Brazil for needed supplies of corn. The severe reduction in wheat and corn production has livestock feeders scrambling to secure needed feed supplies. Brazil is a logical source because of the low percentage of Brazilian farmers who grow GMO corn.
The Brazilian government has been slow in approving new GMO corn hybrids and as a result, a little more than 30% of the corn crop in Brazil consists of GMO corn hybrids. Additionally, most of the GMO hybrids that have been approved in Brazil are also the hybrids that have already been approved in Europe. Therefore European importers feel Brazilian corn may offer the path of least resistance for European consumers.
This isn't the first time that Europeans turned toward Brazil for non-GMO corn imports. In 2007, drought reduced the corn and wheat production in Western Europe and European importers turned to Brazil for supplies of needed non GMO corn. During that year, Brazil exported a record 11 million tons of corn compared to 2.5 million tons of corn exports during the previous year. Those record exports set the stage for a significant increase in Brazilian corn production.
During the month of July that just ended, it is estimated that Brazil exported 500,000 tons of corn. Brazilian corn exports are expected to more than double during August to 1.1 million tons due in part to increased exports to Europe.