Posts Tagged ‘Brazil’

U.S. Imports of Brazilian Corn Continue into Late 2013

November 5, 2013

Following one of the worst droughts in U.S. history in 2012, U.S. imports of corn from Brazil can still be seen as late as August and September of this year, while this year’s harvest is slow to fill the gap between supply and demand.

Global Corn Trade

As previously reported by Reuters, rumors of the rare imports of this U.S. staple began surfacing last July as domestic corn prices soared. By late September deals had been confirmed by several large livestock companies calling for a series of bulk shipments from Brazil in subsequent months. Despite initial estimates on how much Brazilian corn would be needed, PIERS data shows bulk shipments of corn to major chicken producers like Pilgrim’s Pride Corp as late as August 30th, and other bulk shipments destined for Panamerican Grain in Puerto Rico arriving in early October. Prior to 2012, bulk U.S. imports of corn were rare, if ever, and usually came from Canada.

In what should be a reminder that global trade is ever-changing and often unpredictable, PIERS data shows that the U.S. has imported nearly 725,000 metric tons of corn from Brazil since the beginning of the 2012 drought through September 30, 2013. And while Brazil stuck out as the primary beneficiary of the U.S. supply shortage, there was also an additional 185,000 metric tons of corn imported from Brazil’s South American neighbor Argentina.

According to Reuters, John Prestage of Prestage Farms stated that prices could be as much as 5% lower to import corn from Brazil than to transport it from the Midwest. He noted his increasing interest in possibly importing other grains beside corn in the future.

So far things are looking up for this year’s harvest. The U.S. remains the world’s largest producer of corn and favorable weather conditions have estimated the U.S. harvest will jump 30% over last year, putting them at record levels, which could give U.S. corn exports a price advantage over global competitors.

To learn more about how you can benefit from PIERS import & export data register to receive a free demo.

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Decreased Rain = Increased Food Prices

July 26, 2012

 

Brace yourself, 2013 will be the year of above normal food price inflation. Normal yearly inflation is about 2.8%, the USDA projects steady food price increases between 2.5 – 3.5% for the remainder of 2012.

The crippling drought that continues to have a firm grip on more than half of the country will cause an increase in food prices. The USDA states that milk, eggs, beef, poultry and pork prices will all be affected by the drought, which has pushed up prices for feed. Beef prices are expected to see the biggest jump at 4 – 5% and slightly lower increases for poultry, pork, milk and eggs into 2013.

The drought has recently sent the prices of corn, soybean and other commodities soaring (as stated in an earlier PIERS blog) as fields dry out and crops wither across much of the country’s midsection. Corn prices went from $572.88 per metric ton at the end of June to $814.30 a ton this week; soybeans $1,453.75 to $1,696.62; and wheat $702.63 a ton to $915.50. Since corn is used to fatten up livestock, some farmers are selling their stock rather than pay to feed them, while some meat companies are choosing another option – have corn imported from Brazil.

According to a recent Financial Times article citing PIERS data, “The situation – analogous to Saudi Arabia importing oil – underscores how anxious buyers of corn, particularly the livestock, poultry and ethanol industries, have become, as 88% of the domestic crop struggles in drought-hit regions… Records from PIERS, a ports database, show 2008 was the last year foreign bulk corn arrived on the U.S. mainland and then it was in the form of seeds, not animal feed.”

How will these raising food prices and depressed supply of corn and grain affect U.S. imports and exports of these commodities?  Register to learn more about how PIERS Data can show you the details behind every U.S. waterborne shipment in near real-time.

Finding the Next BRICs

January 3, 2012

The coining of the acronym BRIC (Brazil, Russia, India, and China) by Goldman Sachs in 2001 has brought considerable prominence to these growing global powerhouses.  With the possible exception of Russia, these countries have been extraordinary success stories in global trade over the last decade.

As these countries’ economies mature and become common fixtures in the investment community, investors are eager to uncover the next “diamond in the ruff” to secure double-digit returns for years and decades to come.  A recent article in the December issue of Global Finance magazine showed what traits leading financial institutions use to identify the countries they think are poised to become “future-star” economies and what their predictions are for their respective “next big thing” lists. 

In an attempt to emulate the success of the BRIC moniker, Goldman Sachs has introduced the Next Eleven (N11), while HSBC’s list uses the acronym CIVETS (Columbia, Indonesia, Vietnam, Egypt, Turkey, and South Africa).  Fidelity has chosen a similar acronym MINTs (Mexico, Indonesia, Nigeria, and Turkey), and Citi has created their Global Growth Generators, or 3G countries.

Growth Economies Acronyms 

According to the article there are three factors that seem to be the underlying prerequisites for explosive global growth: a stable sociopolitical environment, human capital, and infrastructure. 

A stable sociopolitical environment is essential to help create a venue in which companies can invest. Dong-Sinh Ngo, Chief Strategist, Emerging Markets and Asia Pacific, at BNP Paribas IP, says, “Institutions and the rule of law are necessary for growth.  At the most basic level, legal institutions are needed to guarantee contracts in order to motivate people to invest.”

Another important factor in a country’s success is human capital.  But according to experts interviewed by Global Finance merely having a large population of working age adults is not enough by itself to fuel growth.  Nicolas Kwan, Head of Research, Asia at Standard Chartered, explains, “People need to be educated at primary and secondary level for them to achieve their potential—long-term growth can’t be built on cheap labor.”

The third and final factor is infrastructure.  Without proper investments in infrastructure like electricity, roads and bridges, and ports, trade on a global scale is not sustainable in the long-term, and those countries that haven’t made adequate investments will likely see slower growth.

So assuming their predictions are correct what are the next big emerging markets? 

The only country that was selected by all four institutions was Indonesia, followed by Nigeria, Vietnam, Turkey, and Egypt which were included in three of the four analyses.  Other countries mentioned more than once include Bangladesh, Mexico, and the Philippines. 

Ultimately, only time will tell which of these economies will prevail, but global trade intelligence from PIERS can help you uncover which markets are growing and which are in decline.  To learn more, register for a free market snapshot at www.piers.com.

PIERS Data Shows U.S. Containerized Exports Drop 3% in October – Struggling European Markets Led Losses

December 22, 2011

U.S. containerized exports contracted in October for the first time in 4 months as European markets softened markedly. Overall U.S. containerized exports fell 3.0% Year-Over-Year in October totaling 1,008,273 TEUs, after climbing 10.3% in September.

Year to date, through October, overall U.S. containerized exports were still up 7.1%. However, PIERS/JOC, Economist, Mario Moreno’s recent updated forecasts point to a 5.8% growth for full year 2011, and slower growth for 2012 at 3.8%. On a month to month basis, exports rose 1.3% in October over September.

U.S. Containerized Exports October 2011

Demand from Europe continues to decline as European economies struggle with ongoing sovereign debt problems and decelerating manufacturing activity. Following flat growth in Q3, exports to Northern Europe dropped 7% in October as shipments of motor vehicles (-38%), paper & paperboard (-29%), and wood pulp (-23%) contracted sharply. Losses in outbound shipments to the Mediterranean region continued. After plunging 10% in Q3, trade to the Mediterranean tumbled 14% in October as demand for vinyl alcohol (-58%), paper & paperboard (-18%), and wood pulp (-32%) succumbed markedly. Significant losses were also seen in South American markets, particularly in Brazil. On the upside, exports to Africa gained momentum, expanding 20% on account of grocery products, poultry, and vinyl alcohol among other goods.

On a country level, Brazil led the losses driven by a marked slowdown in economic activity, which led policymakers to reverse tightening policy. Exports to Brazil plunged 25% to a total of as demand for miscellaneous plastic products (-59%), wood pulp (-40%), and unclassifiable chemicals (-32%) reversed sharply. Italy and Hong Kong followed, each dropping by 34%  and 11% respectively. Exports to China, nevertheless, kept at posting gains, up 4% as demand for U.S. logs & lumber (+64%), wood pulp (+47%) and meat (+195%) continued.

On a commodity level, significant losses were seen in pet & animal feeds (-12%), grains & flour products (-32%), paper & paperboard (-2%), and motor vehicles (-7%). This marks the first decline for motor vehicles in 14 months, Year-Over-Year. Offsetting some of the losses are synthetic resins (+125%), meat (+38%), logs & lumber (+17%), poultry (+27%), and mixed metal scrap (+7%).

PIERS is the only source for transaction-level U.S. export data. PIERS staff reporters cover every major U.S. port, collecting and processing over 300,000 export Bills of Lading each month to provide a complete view of U.S. trade. To learn more about PIERS export data, visit www.piers.com/USExports.


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