WASHINGTON, D.C., U.S. — Colombian grain production could be impacted in 2016 as the period of drought from the El Niño weather phenomena transitions to rainier conditions of La Niña, U.S. Department of Agriculture’s (USDA) Foreign Agricultural Service (FAS) said in a March 15 report.
Corn production will fall slightly from the year before to 1.7 million tonnes in marketing year 2016-17, while imports surge to 4.5 million tonnes. Colombian corn farmers continue to gradually switch production toward white corn from yellow corn, as prices for white corn, the primary raw material for the food staple, continue to be more favorable than yellow corn, which is primarily destined for animal feed.
In market year 2016-17, the report forecasts Colombia’s total corn imports to reach 4.5 million tonnes with imports of U.S. corn surging to 4.2 million tonnes as U.S. corn remains price competitive due to trade preferences of the U.S.- Colombia Trade Promotion Agreement (CTPA). As well, feed demand continues to grow while domestic corn production remains stagnant. Low corn prices have motivated the feed industry to primarily source corn instead of other grain substitutes, such as sorghum or wheat.
In market year 2016-17, wheat and sorghum production will fall to 10,000 tonnes and 190,000 tonnes, respectively, with imports expected to reach 1.5 million tonnes for wheat and 50,000 tonnes for sorghum.
Due to the CTPA, U.S. wheat market share has recovered against Argentina. However, competition with Canada continues to be the most significant challenge to U.S. wheat. The Colombia-Canada Free Trade Agreement was signed a year before the CTPA.
Rough rice production in market year 2016-17 is expected increase to 2 million tonnes with imports falling slightly down from the previous year to 320,000 tonnes due to expanded domestic production. U.S. market share could be challenged by new phytosanitary protocols for MERCOSUR (Southern Common Market) milled rice creating more sourcing options for importers. Colombia’s rice imports are historically from neighboring countries.