How to fill a 4 million ton niche...
Who Will Supply Brazil's Corn Demand?
(19 July - Cropchoice News) - According to unattributed reports on agweb.com, Argentine market experts say Brazil's ban on GMO corn has taken a 350,000 ton bite out of Argentina's exports to its neighbor to the north. Factor in bad weather impacting domestic production - which often falls short of demand - and Brazil is expected to be in the market for about 4 million tons of non-GMO corn in the coming months. For American farmers to benefit, producers and elevators will have to be sure their IP systems work.
Argentina, meanwhile, has had to dispose of the unexpected corn on its hands since exports to Brazil dropped off dramatically when activists started demanding GMO tests on corn from Buenos Aires. It can't go to Europe, which would reject the corn for same reasons Brazil did. So Argentina has been shopping its GMO corn around to other developing countries and, according to reports, found buyers in Iran, Egypt, Chile, and even the tiny islands of Mauritius. But there's an unexported quota of almost 2 million tons still looking for buyers.
Brazil's ban on GMO corn is currently the subject of a huge domestic debate. The government is divided while lawsuits are flying fast and thick. Activists are even threatening to drag the Agriculture minister to court, personally, for some rather ill-considered comments made to the press.
The most vocal force in favor of lifting the ban are poultry integrators, who want cheap corn and, so far, don't care if its GMO. And, of course, the GMO seed industry. The situation is ironic since Brazil is the major source of non-GMO soybeans being used by European poultry feed producers, including Cargill. There's strong support for the ban from important activists, government, and agriculture lobbies that want to keep Brazil GMO-free for environmental reasons and so the country can expand its market share in Europe and beyond.
It seems unlikely the Brazilian debate will be resolved soon, so - certainly for food grade grains - the ban appears set to remain solid.
Where to find the corn to meet Brazil's needs? Four million tons is almost 6% of total US projected exports for 2000/01. Brazil might turn to China or Eastern Europe; but supply is limited and shipping costs high. The US is the logical choice, if America can supply it.
SOURCE: agweb.com, Jornal do Brasil, USDA, Pro Farmers