USDA Forecasts Foreign Corn and Cotton Imports

February 13, 2001

North Africa and Middle East corn imports have more than doubled over the last decade and are forecast to comprise nearly 20% of world corn trade in 2000-01, according to USDA. Despite efforts by many governments to increase production of various crops, the region's climate and scarce water supplies are expected to leave these countries heavily dependent on corn imports.

Growth in income and population are fueling rising consumption of poultry and to a lesser extent beef , dairy, and sheep products. Recent lower corn prices compared to alternative feed stuffs have encouraged more corn use in feed rations, and demand for corn-based snack foods and starch is also growing. With the economies of these countries expected to remain stable, they should provide a steady future market for corn.

The US continues to maintain a dominant share of this market, with exports up 150% over the decade to nearly 10 million tons. Argentina continues to be the other major supplier.

In its world cotton outlook report, USDA said world 2000-01 estimates reflect marginally lower production, consumption, and trade. Production is reduced mainly in India, and consumption, mainly in the United States. The reduction in U.S. exports is partially offset by an increase for Egypt.

Following the financial crisis at the end of 2000 and the government's takeover of a number of banks, the Turkish textile industry continues to be squeezed by high credit costs and a lack of orders. As a result, domestic consumption and imports of foreign cotton will be lower this marketing year than previously anticipated.

As a result USDA lowered its estimate in January imports and consumption by 200,000 bales each to 1.65 million bales and 5.5 million bales, respectively. Despite this decrease, U.S. cotton exports to Turkey as of Feb. 1 increased 78,300 bales, or 40%, from the same period last year. In fiscal 2000, total U.S. cotton exports to Turkey increased by about $60 million for a market share of 35% from the previous year, making Turkey one of the most important export destinations for U.S. cotton after Mexico.

Greece, the second largest cotton exporter to Turkey had a market share of 26 percent. The increase in U.S. exports could be a result of a decrease in cotton exports from some competing countries such as Greece, Central Asia, Egypt and Pakistan, where production declines have been recorded.

Despite Turkey's financial crisis and lower domestic consumption, the outlook for U.S. cotton exports to Turkey continues to be good. A decrease in cotton exports by competing countries and an improvement in the economies of major textile consuming countries in Europe and Asia, contribute to the positive outlook for U.S. cotton exports to Turkey.