Analysts foresee stronger corn exports to China

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Farm Forum

Corn and soybean prices should improve moderately this year, and there appears to be longterm potential for increased U.S. corn exports, local ag producers learned Tuesday.

Kim Dillivan, crop business management field specialist for the South Dakota State University Extension Regional Center in Aberdeen, shared a 2015 crop marketing outlook at the Brown County Crop Improvement Association meeting at the AmericInn. About a dozen people attended.

Dillivan said estimated corn prices are expected to hit $4.11 per bushel by July and creep up a little more by December. As a reference, according to Wheat Growers, the price of corn for January is $3.36 per bushel. Dillivan said the estimated cost per bushel without taking land rent prices into account is $2.96.

He said it’s encouraging that the corn export market is apparently opening back up with news that China has officially concluded a five-year review of a new corn variety from Syngenta. That, he said, will open the market for additional exports to China.

Last year, China imported 4 million metric tons of corn, Dillivan said. But imports were only strong early in the year and dropped off to almost nothing for most of the year, he said. While China produces a lot of corn, Dillivan said, projections from the U.S. Department of Agriculture expect China to be a stronger importer of corn starting as soon as 2016. Dillivan said those projections seem to indicate imports as high as 22 million metric tons by 2023-24.

Dillivan said China’s stronger imports are due to changes in diet that are calling for more chicken and pork.

“Southeast Asia may become a big importer of corn if their diets advance like China’s,” Dillivan said.

He said the outlook for soybeans shows a price projection of $10.07 to $10.37 per bushel starting in July. The current price, according to Wheat Growers, is $9.62 per bushel. The estimated cost of production, he said, is $7.29 per bushel, not including land rent.

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