Brazil ships corn to the U.S. for the first time in 2019

Brazil this week shipped 60,000 tonnes of corn to the United States, according to Refinitiv data, an unusual export destination given the North American country’s status as the largest producer and exporter of the cereal.

The corn was exported by Cargill, ship scheduling information showed <WILSOYA/SHP>. Cargill confirmed the shipment, declining to elaborate.

NovaAgri SA, another local grain trader, said in a statement it also shipped some 60,000 tonnes of corn to U.S.-based meatpacker Smithfield Foods [SFII.UL] on Sept. 3 from Santos port.

Cargonave shipping data shows a vessel named King Milo will carry some 52,400 tonnes of corn to the United States on Oct. 17 from Itacoatiara port.

So far in 2019, Brazil’s corn exports totaled 27.46 million tonnes, surpassing the entire volume sold in foreign markets last year.

In June, market sources said Brazil was selling corn to the United States, with shipments due to start in September, a move that underpins local sellers’ ability to access new markets amid a record crop.

The sources said U.S. demand for Brazil’s corn has been driven by fears of crop failure in North America, as U.S. farmers dealt with climate issues in the beginning of the planting season.

At one point this year, these fears pushed Chicago corn prices to peak around $4.54 per bushel. Corn is currently trading around $3.70.

Refinitiv’s interactive ship monitoring map showed that a vessel called Qing Hua Shan finished loading Cargill’s corn destined to the United States on Wednesday.

That ship was loaded at Cantagalo General Grains’ (CGG) terminal at the port of Itaqui, a convenient gateway that is closer to the United States than Santos, Brazil’s largest port, located in the country’s Southeast region.

Agrostat data, compiled by the agriculture ministry, does not yet show the U.S.-bound corn shipments from Cargill and NovaAgri.

Brazil’s government forecast corn exports will grow by 47% this season to 35 million tonnes.

“It’s just the first one, there are still others to come,” Frederico Humberg, chief executive at grain trader AgriBrasil, told Reuters on Friday in relation to the prospect of more corn exports this year.

Expectations of record Brazilian sales abroad reflect a favorable exchange rate and a bumper harvest of nearly 100 million tonnes, traders said.

According to Brazilian government data, Brazil is seeing demand from traditional buyers of U.S. corn, including Mexico and Colombia, which have already bought more than 500,000 tonnes from January to August.