Canadian and US grain sectors release cross-border trade study

A new study, released by the Canada-U.S. Task Group, a group of Canadian and U.S. non-profit and trade organizations, documents the commercial flow of grain from the United States to Canada. The study addresses U.S. and Canadian trade volume, handling and processing practices for more than 15 commodities traded between the United States and Canada. The analysis was provided to the Canadian and U.S. governments as input in the consultations for the development of phytosanitary measures under Canada's proposed Grain Import Framework (D-12-05).
The study, located online, examined data from 2010 to 2012. On average, corn is the number one commodity moving north from the United States to Canada at 1.05 million metric tons (MT) per year. Average soybean exports to Canada are 245,000 MT while wheat exports are 69,000 MT. Additionally, the report indicates that 380,000 MT of screenings enter Canada on average, but this category mainly encompasses highly processed grain commodities that will be exempt from the proposed framework.
According to the study, 54 percent of all U.S. grain exports to Canada were transported by truck, followed by rail at 32 percent and water at 14 percent. The high percentage of truck movements highlighted a potential problem if inspections and certificates would be required on each shipment. However, based on the risk assessments of the various crops and taking into consideration their end-use in Canada, it is expected that only a small number of these U.S. shipments will require a phytosanitary certificate.
The study also found that Canadian processing practices generally minimize phytosanitary risks that may arise from U.S. shipments. The commodities are typically cleaned at the recipient's facility and screenings are heated, hammered and turned into feed or sent to landfills which mitigate phytosanitary risks.
Additionally, the Task Group has been engaged with the Canadian government to address concerns and will continue to participate in the governmental consultation process to improve Canada's Grain Import Framework (D-12-05) implementation.
Canadian and U.S. organizations formed the Canada-U.S. Task Group in April 2012 and have been working together to communicate cross-border trade information. As part of this effort, the task group launched its website to provide answers to questions about cross-border trade for wheat, durum, and barley producers in Canada and the United States. In its first year, about 4,500 visitors explored information targeted toward Canadian producers, U.S. producers, and the commercial grain and seed trade. Visitors can also submit comments and additional questions through the website.

Soybean research staff travel to Asia

Several Illinois Soybean Association directors and staff recently traveled to Asia on a checkoff-funded mission to promote the state's transportation system and discuss ways to improve shipping the state's soybeans to customers around the world.
"The mission was uniquely focused on transportation and logistics to ensure our soybeans reach international markets competitively. Normally, we meet with processors and end-user customers during our trade missions," says Ron Kindred, soybean farmer from Atlanta, Ill., and the association’s Marketing Committee chairman.
In addition to Kindred, the group included Chairman Bill Wykes, a farmer from Yorkville, Ill.; Transportation Subcommittee Vice Chairman Paul Rasmussen, a farmer from Genoa, Ill.; Director of Issues Management and Analysis Mike Levin; and Transportation and Export Infrastructure Lead Scott Sigman.
Association representatives met with global shipping carriers at corporate headquarters in Seoul, South Korea, and Tokyo, Japan, to discuss how to better coordinate with shippers' freight needs and ensure Illinois soybeans reach overseas markets as efficiently as possible. The association is working to increase soybean utilization to 600 million bushels by 2020.
"Efficient transportation is imperative to reach our goal, so this trip was an opportunity to align with shippers. We want to make sure we provide our soybeans to them where, when and how they want them so they can deliver our soybeans to end users effectively," says Kindred.
"Our goal was to bring awareness of Illinois soybeans to these companies, and I think we accomplished that," says Wykes. "We were the first group to come speak with many of these companies about soybean shipping."
Rasmussen says the group successfully showcased Illinois transportation assets to multinational shipping companies that included STX Pan Ocean, Hanjin Shipping, Hyundai Merchant Marine, K-Line, NYK Container Line, and Mitsui O.S.K.
"Although most of the carriers have offices in the Midwest, their corporate leaders did not realize the extensive transportation network in Illinois to move bulk and containerized soybeans to nearly all U.S. ports via trucks, rail and barge," says Rasmussen.
"The representatives we met also were impressed with the checkoff-funded research we have done to improve transportation competiveness within and through the state," says Wykes. "Because containerized shipping is such a big part of their businesses, we shared study results illustrating the feasibility of moving containers of soybeans out on barges between Chicago or central Illinois and Gulf of Mexico ports."
Research conducted in 2011 pointed to container-on-barge shipping as a viable option. The association is developing a pilot program this year to test its sustainability.
According to data obtained from Informa Economics, Illinois-sourced grain and soybeans account for 66 percent of U.S. containerized exports. Currently, 15 percent of soybeans exported from Illinois are containerized, and volume is expected to continue to grow.
"The trip was definitely a success, but it is yet to be seen what the next steps will be. We have started the conversation, and will continue to be a conduit for improving efficiency throughout the supply chain to bring value back to Illinois soybean farmers," says Wykes.

Ukraine corn exports up 20 percent in December

Ukraine's corn exports increased 20 percent in December 2012 over November 2012 numbers, to 2 million metric tons, according to the country's Agriculture Ministry.
Total grain shipments in December were 2.4 million metric tons, and grain exports totaled 14.5 metric million tons for the marketing year begun July 1, 2012. Corn accounted for 6.3 million metric tons of those shipments, according to the ministry. Wheat accounted for 5.9 million metric tons, while barley accounted for 1.8 million metric tons. 

IGC predicts rise in world grains trade through 2016

An average annual rise of 2% in world trade in grains during the crop years 2010/11 to 2015/16 was among five-year supply and demand projections presented to a meeting of the International Grains Council held in Perth, Australia.
World trade in grains in 2010/11 was placed at 241 million metric tons, marginally above the previous year. Wheat trade is set to fall, but this will likely be offset by increased maize shipments.
The meeting also heard expectations that world grain supplies will tighten in 2010/11 as production of wheat, maize and barley fall short of forecast consumption. However, the slowing growth of industrial use, especially of maize used for ethanol in the U.S., will limit the rise in grains consumption to 1.5% compared to 2% in the previous year.
The substantial fall in grain output in the CIS area, especially in Russia, is expected to lead to a shift of around 30 million metric tons in wheat and barley exports to other suppliers, notably the U.S., European Union, Argentina and Australia.
Having risen by 120 million metric tons in the previous three years, global carryover stocks of grain in 2010/11 are expected to decline by some 60 million tons, half of this being due to tightening maize supplies.
The outlook for 2011/12 was said to include a 2% increase in the global wheat area. This would partially be in response to higher prices, but it was also forecast to reflect a recovery after the extreme summer weather conditions of 2010.
Despite recent crop problems, said the IGC, grain availabilities are actually higher than forecast a year ago. However, consumption projections are also lifted, and stocks at the end of 2010/11 are expected to show some further decline from those previously forecast. Maize supplies, in particular, are likely to tighten. 

Drought decimates Argentine grain output

After a hard drought and a year-long conflict between the government and the rural sector, the once thriving industry suffers a setback. Read the full article in Feed International.

US Grains Council meets with USDA

Representatives of the U.S. Grains Council met with USDA Under Secretary Jim Miller earlier this week in Geneva, Switzerland, for insight into the World Trade Organization’s Ministerial Conference taking place there and to learn about progress being made in the Doha Round of WTO negotiations.
According to a press release from the council, Miller said that Ministerial Conference was not a negotiating session, but that the Doha Round is moving toward a close and his primary concern is that the United States gets adequate market access from advanced developing nations.
In a press release, USGC president and CEO Thomas C. Dorr said his organization “supports the United States’ position consistently stating that we want the following: market access; more clarity on the modality texts; and to know what products will be designated as special or requiring special safeguards in the designated tariff lines.”
He added that the council “will continue to follow these negotiations closely as they directly affect the economic standing of the United States as well as the U.S. farmer."

Bosnia and Herzegovina year-on-year exports increase

Animal feed exporters in Bosnia and Herzegovina substantially increased their year-on-year exports in the first nine months of this year.
Although the exports were 84.3% higher, they were still worth only EUR216,000, according to Bosnia's Federal Statistics Office.
Bosnia's animal feed imports fell by just 0.1% year-on-year to EUR17.3 million in the January to September period.

PAVA conducts talks with Japanese partners

Grain processor PAVA negotiated with one of the largest Japanese corporations as part of the company’s policy to expand international partnerships.
The meeting was held in Barnaul, Russia, where PAVA headquarters are located.The agenda of the meeting included a number of issues including potential trading cooperation and financial partnerships regarding PAVA’s new projects. Current business strategy of the grain processor is based on implementation of two projects: “Russian Agricultural Division” (expansion of land bank and farming) and “Grainvest” (deep wheat processing that involves reconstruction of some facilities).

Russia to increase grain exports

According to reports, Russia is closer to its goal of increased grain exports. Black Earth Farming Ltd. is expected to export grain to Japan and expand grain production by more than 500,000 metric tons this year.
Russia plans to double its exports in the next 10 to 15 years by developing fallow land. The country is promoting the endeavor with loans to support additional grain terminals and silos. Black Earth also plans forward sales with traders and fertilizer suppliers both at home and abroad.In Stockholm trading, Black Earth rose 1 krona, or 4.1%, to close at 25.70 kronor.

Russia to increase grain production

Elena Skrynnik, the Minister of Agriculture of Russia, announced the country would grow up to 120-125 million tons per year of grain in 10-15 years, say reports. This gain will come from the use of additional lands and increased yields.
These volumes will allow Russia to double current exports to 40-50 million tons to Central and Southeast Asia, the Middle East, Southern Europe and Africa. It may also spur the modernization of grain storage and transportation in Russia.