Over the past two decades, the global export market for corn has more than doubled. However, over the same time period, the U.S.’s share of this market has remained flat.
Most of this growth has been gained by Ukraine, Brazil, Argentina, and Russia, while the U.S.’s market share has contracted from more than 50 percent 20 years ago to about one-third today.
One reason is the relatively strong U.S. dollar, and the ability of the U.S. to withstand the printing of money and the influx of cash more than other countries. For example, during the COVID-19 pandemic, the U.S. and Brazil have reacted similarly, however Brazil’s currency has fallen in value by as much as 40 percent since January.
And as the pandemic makes exports more important, U.S. farmers have no incentive to expand acreage due to crop insurance, higher farm equity levels, and low interest rates, and they understand that if they do expand corn acreage, a glut would ensue, flooding the market.
Lynda Kiernan is Editor with HighQuest Group Media and of the Oilseed & Grain News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at firstname.lastname@example.org.