U.S. GRAINS COUNCIL Around the world; Around the clock Kurt Shultz Regional Director Latin America and Caribbean Leveraged Funding Non-Cash $7.8 Million Member Cash $5.2 Million FAS Funds $14.8 Million $27.8 Million Cornerstones for Programs Market Access Market Development Market Defense Gathering Market Intelligence 1
Latin America & US Corn Export Worldwide (1, MT) the Caribbean: 11 of the TOP 2 US corn markets 21 29 28 27 26 25 24 23 22 21 2 Mexico Caribbean Others 1,, 2,, 3,, 4,, 5,, 6,, (1, MT) US Corn Export LTA (MT) US Corn Export LTA (MT) 21 29 21 29 28 28 27 26 25 24 23 22 Mexico Caribbean 27 26 25 24 23 22 21 Caribbean 21 2 2 1,, 2,, 3,, 4,, 5,, 6,, 7,, 8,, 9,, 1,, 2,, 4,, 6,, 8,, 1,, 12,, 14,, 16,, 18,, 1.4 MMT (46 million bushels) and 5 TMT of DDGS growth in 9 years 2
US Sorghum Export Worldwide (1, MT) US Sorghum Export LTA (1, MT) 21 21 29 29 28 27 26 Mexico 28 27 26 25 25 24 23 22 Caribbean Others 24 23 22 Caribbean 21 2 21 2 1, 2, 3, 4, 5, 6, 7, Sorghum(1, MT). 5. 1. 15. 2. 25. 3. 35. Sorghum(1, MT) Colombia Sorghum Import (MT) Latin America Overview Sorghum ( MT ) 2, 18, 16, 14, 12, 1, 8, Venezuela United States Mexico Brazil Australia Argentina 6, 4, 2, 2 21 22 23 24 25 26 27 28 29 21 3
Prod. Chicken Tn. Nicaragua % El Salvador 1% Brasil 56% Panamá % Costa Rica 1% Ecuador % Honduras 1% Bolivia 1% Guatemala 2% México 14% Perú Chile 4% 3% Argentina 7% Colombia 5% Venezuela 5% 4 35 3 25 2 15 1 5 Chicken Consumption per Capita (Kg) 2 MMT Corn Market Panama 8% Nicaragua 14% Honduras 19% Population Costa Rica 11% El Salvador 15% Guatemal a 65 TMT of corn (26 m bushels) 63 TMT DDGS 385 TMT of corn (14.6 m bushels) 23 TMT of DDGS 17 TMT of corn (4.2 m bushels) 4.5 TMT of DDGS Combined: 45 million 611 TMT of corn (24.4 m bushels) 74 TMT of DDGS 338 TMT of corn (13.5 m bushels 1 TMT of DDGS 4
The Caribbean 1.9 MMT Corn Market Caribbean Population 21 611 TMT of corn (24.4 m bushels 99 TMT of DDGS Dominican Republic 46% Cuba 54% 964 TMT of corn (38.5 m bushels) 12 TMT of DDGS 24 TMT of corn (9.6 m bushels) 3 TMT of DDGS Combined population of 2 million 94 TMT of corn (3.7 m bushels DDGS Strengths Freight Advantage +9% US market Share Free Trade Agreements Weakness Economic instability and slow growth Political uncertainty Drugs & Crime Inland Transportation Opportunities Niche markets Sorghum DDGS Threats Quality Infrastructure improvements in SA Colombia & DR Imports of SA corn 5
3.4 MMT Corn Market 1.2 MMT of corn (48 m bushels) 73 TMT of DDGS Population 21 11% Venezuela Peru Title 7% slide Argentina Brazil 54% Chile 4% Colombia 12% Combined Population of 375 Million 8% Ecuador 4% 3 TMT of corn (12 m bushels DDGS 58 TMT of corn (23.2 m bushels DDGS 72 TMT of corn (29 m bushels) 65 TMT DDGS 1.3 MMT of corn (52 m bushels) DDGS Strengths Freight Advantage North America Multiple shipments Free Trade Agreement with Peru and Chile Weakness Economic instability and slow growth Political uncertainty (Venezuela, Ecuador) Opportunities Niche markets Sorghum DDGS Colombia, Ecuador, Peru, Venzuela FTA Colombia Threats Quality Infrastructure improvements in SA Colombia Imports of SA corn 6
Free Trade Agreements with USA Colombia and Why an FTA is Critical Existing Peru Chile CAFTA DR Pending Colombia Panama Colombia Corn Imports (MT) 4,, 3,, 2,, 1,, 27 28 29 21 (Jan Oct) Argentina Others United States Brazil In 28, US exported $6 million in corn, 29 US corn exports declined to $2 million 6,, 5,, 4,, 3,, 2,, 1,, Colombia and Why an FTA is Critical Colombia Total Grain Imports (MT) 27 28 29 21 (Jan Sept) United States Argentina Brazil Canada Others 28 US exports of corn, wheat and soybeans were valued at $1.1 billion; in 29 it declined to $423 million and in 21 $343 million 39.7% 7.8% Colombian Agricultural Market Market Share (%) 46.5% 27.7% 13.8% 21.% 6.3% 5.2% 6.4% 29.6% 2.6% The U.S. farmers used to be the main supplier of agricultural goods in Colombia with a peak of 46% of market share in 28. However, in 21 the U.S. market share has fallen to 21%, and for the first time will lose its position as the main Colombia s agricultural supplier. 7.% 25 26 27 28 29 21 (Jan Oct) Argentina United States Canada Includes WTO agricultural sectors Source: Colombian National Department of Statistics OCW 7
Colombian Imports of Corn, Wheat, Soybeans & their products Market Share (%) Colombian Agricultural Market Share for Wheat 71% 76% 71% Until 29, the U.S. was the main supplier of corn, wheat, soybeans and their products in Colombia with a peak of 76% of market share in 27. However, in 21 U.S market share of these products fell to 27%, and for the first time, U.S lost its place as Colombia s main supplier. 38% 53% 31% 27% 16% 1% 12% 7% 4% 7% 8% 25 26 27 28 29 21 (Jan Oct) Argentina United States Canada Source: Colombian National Department of Statistics OCW Since 29 U.S. has been losing market share in Colombia s wheat market. U.S. was Colombia s main supplier of wheat & products with a peak of 73% of market share in 28. Canada and Argentina are displacing U.S. exports. 3 Source: Colombian National Department of Statistics OCW Building Export Markets: Key Issues Conclusions Colombia is an important growing market for U.S. agricultural exports (the 3 rd largest in South and and the Caribbean). In 28 Colombia was the 8 th largest market for U.S. corn, wheat, soybeans and their products. POLICY MARKETING The U.S. has been the main supplier of agricultural products to Colombia, especially for Corn, Wheat, Soybeans and their products. However, U.S. market share shrunk from 76% in 27 to 27% in 21. In 21 Argentina, which has an FTA with Colombia (Mercosur), became Colombia s main agricultural supplier. In 211 it is expected that Canadian products will also enter duty free to the Colombian Market. U.S. is paying the cost of inaction: While many other countries are negotiating and implementing FTAs with Colombia, the Colombia U.S. FTA has been awaiting approval since 26 with enormous costs for both countries. 8
1 Growing Middle Class DDGS Data 8 6 Population (millions) 4 98.11 276 616 Developing countries 3 year growth: 528% 2 Developed countries 3 year growth: 36% 199 1994 1998 22 26 21 214 218 Source: Global Insight s Global Consumer Markets data as analyzed by OGA 33 16 14 U.S. Ethanol Production 7,, 6,, U.S. DDGS Exports 23 21 million gallons 12 1 8 6 4 2 Growth Production 5,, 4,, 3,, 2,, South Asia/Oceania Africa CAM/Carrib/SAM Middle East Southeast Asia North America East Asia Europe/Russia 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 212/13 213/14 214/15 215/16 1,, 23/4 24/5 25/6 26/7 27/8 28/9 Sep Jun Sep Jun 29 21 9
DDGS Import (Cummulative) & Caribbean DDGS Import (Cummulative) 16, 45, 14, 4, DDGS (MT) 12, 1, 8, 6, Chile Peru Colombia Ecuador DDGS (MT) 35, 3, 25, 2, 15, Jamaica Cuba Costa Rica Guatemala El Salvador Honduras Panama 4, Venezuela 1, Dominican Republic Nicaragua 2, 5, 24 25 26 27 28 29 21 (Jan Oct) 24 25 26 27 28 29 21 (Jan Oct) Demand Building DDGS (TMT) 2,5 2, 1,5 1, DDGS Exports Morocco 5 24 25 26 27 28 29 21 211 212 213 Total Potential DDGS Demand & Caribbean DDGS DDGS 1
Morocco POULTRY Market Development 2 15 1 5 US Corn: CGF DDGS 68 M Bushels 7 TMT 12 TMT 14 Total Imports Imports from US K il o g r a m s 12 1 8 6 4 2 Per Capita Meat Consumption and Income TMT 5 45 4 35 3 25 2 15 1-5 FISA Created 198 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 21 18 16 14 12 1 8 6 4 2 - DHs/Kg 5 1 15 2 25 3 35 4 199 US Dollar Poultry Meat Production Farm Gate Price MOROCCO: Ruminant Sector Take Aways! Support Colombia, Panama and Korean Free Trade Agreements Support your check off Corn Title & Sorghum slide Watch sorghum exports other than Mexico Watch China 11
THANK YOU! 12