A former director with the U.S. Grains and Bioproducts Council says the organization’s work to expand markets for corn, sorghum, barley, and ethanol products is proving vital for farmers.
Jim Reed, who farms in central Illinois, says export demand continues to be a saving grace for commodity prices.
“Corn exports this year are already 30% ahead of last year at this time, and last year was a record export year for corn.” He says, “Ethanol is the same way, it’s kind of really helped put a floor underneath the market for the prices.”
Reed cites a recent agreement with Thailand which should further boost corn exports, but he’s most optimistic about expanded ethanol sales to drive corn demand.
“There’s a boon in the ethanol market overseas.” He says, “A lot of Southeast Asia is moving to an E10 platform. The benefits of ethanol are being recognized, and that’s just been a worldwide story.”
When asked with potential movement on nationwide E15 at home and increased global demand, does the U.S. have enough corn? “Oh, yeah, and we don’t need acres to do it.” He says, “The yield curve has been going up and up, and we’ve always got a surplus.”
Reed says the Council’s efforts to develop trading relationships in over 30 countries provide farmers with some of the highest return on investment of their checkoff funds.
EDITOR’S TAKE:
Increasing export demand is fundamental to improving prices and moving U.S. production from the farm to customers around the world. Partnerships between USDA market development programs and state or commodity organizations are at the center of reaching and developing those new markets. Together, such funding helps explore, educate, and to make sure shipments are made to overseas destinations. Like we have stated many times in this newsletter, exports can often account for up to 40 or 50 percent of the commodities’ total production. This is especially crucial during periods where geopolitical or other market disruptions are taking place.
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