CORN QUALITY IMPACTS WORLD MARKET SHARE
As we’re working to promote the Trans Pacific Partnership and fast-track Presidential Trade Promotion Authority, it’s a good time to remember other things that impact corn export opportunities…like grain quality. IL Corn leverages your corn checkoff dollars through the U.S. Grains Council to address corn quality and your export customers’ concerns. We know that about 46% of your corn leaves the state of Illinois, and a good portion of that leaves the country entirely. How does it look at its final destination?
By: Erick Erickson, U.S. Grains Council Vice President
Corn quality, good and bad, is an issue often raised by customers as U.S. Grains Council (USGC) staff promotes U.S. corn exports around the world. And while the specific quality requirements of an export shipment are established in individual sales contracts, the Council always is looking for ways to enhance the quality image, or the quality brand, of U.S. corn.
Encouraging the entire corn production chain to continually improve the quality of U.S. grain is a critical component of safeguarding U.S. competitiveness in export markets.
Production by export competitors has risen sharply in recent years. Since 2005, Brazil and Ukraine have increased their exportable corn supplies by about 32 million metric tons (1.3 billion bushels), while U.S. share of global corn trade has fallen from its previous range of 50 to 60 percent to about 38 percent last year.
This means defending U.S. market share has become an important task in marketing the U.S. corn crop. While many factors in grain purchasing decisions are beyond our control, working together, we can have a large measure of control over corn quality.
U.S. corn quality is influenced by every element of the production and marketing system – seed development, equipment design, planting, harvesting, storage, handling, transporting and trading. Seemingly small actions that appear to be far removed from U.S. export customers can influence the quality image of U.S. corn when it is received by export customers.
Corn from a given farm flows into a veritable ocean of corn that travels from thousands of farms through hundreds of elevators, trucks, barges and railcars being mingled and blended into the final lots that get loaded into the hold of a vessel bound for foreign ports. And once a producer delivers his or her corn to that first point of sale, the quality of the final cargo is out of that farmer’s control.
But each farmer has the opportunity to do what they can do, which includes:
delivering corn to export channels with proper moisture levels; preventing foreign materials such as cellphones, bolts, birds, rocks, etc., from being mixed into loads of corn; and using proper drying techniques to minimize stress cracks.
Every step in managing corn quality on the farm is a tradeoff of cost versus value, and generally these three steps may not bring additional compensation at the local elevator. And if others do not give the same attention to quality, that final export cargo may not reflect fully the care which you took with your corn. But quality must start somewhere, and must be minded throughout the marketing system. If not you, then who? If not now, then when?