Korea is playing a significant role in recent increases to USDA estimates of corn exports. According to Byong Min, U.S. Grains Council director in Korea, the U.S. corn industry has an opportunity to increase market share.
"Due mainly to the limited availability of Chinese corn, Korea is likely to import more than 6 million metric tons (236 million bushels) of U.S. corn in calendar year 2006," he says.
Corn is currently being sold at approximately $160 per ton (or $4.03 per bushel) in China's main export terminal in Dalian. "U.S. corn should be competitive at these prices," comments Mike Callahan, USGC senior director of international operations in Asia.
China corn exports have tapered off recently as internal demand appears to be consuming most of their production. Increased exports to Korea are also offsetting decreases in regions affected by avian influenza, where declines in poultry consumption have slowed feed demand in countries around the Mediterranean and in Africa.
A human death in one of China's leading poultry-producing regions has focused the trade's attention on feed mills and increased fears that the avian flu virus will impact corn demand. "Bird flu is not having much of a dampening effect on the prices in China," Callahan adds.
However, industrial corn demand in China - for the production of ethanol, starches and sweeteners - has remained steady.
Officials in Jilin, China's top corn producing region, predicted prices will rise in late April or May as stocks are drawn down.
Korea imported 2.1 million metric tons (85 million bushels) of U.S. corn in 2005, approximately 25.4% of their total corn imports.