Bloomberg: Black Sea corn sales to Iran rise to record as Brazil falters

16.03.2017
  • Ukraine, Russia take advantage of Brazil’s poor crop last year
  • Iran’s expanding poultry industry driving corn demand

Published by Anatoly Medetsky

Ukraine and Russia are shipping record amounts of corn to Iran to feed its expanding poultry industry after rival supplier Brazil reaped a poor crop, according to a consultant.

Ukraine, the fourth-biggest exporter, sold 1.53 million metric tons to Iran this season through January, a record versus comparable periods, UkrAgroConsult said in an emailed report Tuesday. Shipments from Russia reached 606,000 tons in the same period, also the fastest pace for corn trade between the countries.

That compares with supplies of 673,000 tons and 194,000 tons for all of the prior season from Ukraine and Russia, respectively. The season runs from September to August.

The sharp rise in trade was unexpected, Olena Hesova, an analyst at UkrAgroConsult in Kiev, said by phone. “Iran is a more closed country than some others. It’s difficult to estimate such markets,” she said.

Ukraine and Russia, the fifth-largest corn shipper, had bumper crops this season while Brazil reduced output last year following a drought, diminishing competition for Iran’s market this season. Brazil is Iran’s main supplier, UkrAgroConsult said.

Iran’s Poultry Industry

Iran’s poultry industry is expanding, and that has boosted demand for feed grains such as corn, UkrAgroConsult said in the report. The U.S. Department of Agriculture last week increased its forecast for Iran’s corn purchases this season to 8.5 million tons, up 29 percent from the previous season.

The Persian Gulf country’s corn imports would more than double this season from the 2012-13 period, USDA data show. In 2012, Iran experienced a shortage of chicken meat after U.S. and European Union sanctions hampered poultry imports.

Demand from Iran this season is helping to make up for smaller purchases by China which is offering domestic buyers corn from its huge stockpiles, UkrAgroConsult said. China will import 3 million tons of corn this season, about 46 percent less than during the season ended in 2016 when it began cutting inventories, according to USDA.

In June, Brazil will probably bring to market its new corn crop, a move that will intensify competition for buyers in Iran, UkrAgroConsult said.

 

 

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