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National Sorghum Producers meet with U.S. Grains CouncilBy Jennifer M. Latzke The National Sorghum Producers met in conjunction with the U.S. Grains Council in San Antonio Feb. 10 to 13. The two organizations held separate and combined meetings with their memberships. The USGC led the meeting with its International Marketing Conference and Annual Membership meeting the morning of Feb. 10, and Joint Advisory Team Meeting General Session. During this session a panel of Overseas Directors detailed U.S. market development and activities in several foreign countries. Additionally Erick Erickson, special assistant for planning, evaluation and projects of USGC, discussed the U.S. and world coarse grains outlook. Erickson started off the session by detailing the market environment that exists today. He explained the world has seen unrelenting commodity price increases in several sectors, including oil, copper, and agriculture all in the past five years. The world is also undergoing a shift in economic growth, with more than 500 million people in several developing countries shifting from subsistence to middle income growth. This new middle class will increase demand for energy, cement, steel and agricultural products. "We're seeing a shift in the demand curve, and the power in developing countries is not easily stopped," Erickson said. Another thing that's affecting world markets is the increasing ethanol industry. Erickson showed how the stocks to use ratio in corn is out of pattern, and the demand for corn is not normal. He said buyers are not so much worried about this year, but more worried about ensuring supplies for the next. The corn outlook for the United States in 2008 should see record exports, surpassing the high levels of the 1980s, when the former Soviet Union and Europe were our biggest buyers, Erickson said. On the world market, there should be steady growth in the corn supply and demand, with corn imports following suit. The U.S. sorghum sector saw declines in production the last several years, but that changed with the spike in production in 2007, Erickson said. He predicted that exports will remain strong this year, even as world sorghum production levels spike. For the most part, the Overseas Directors had positive outlooks for U.S. exports. The real success story across the board in 2007 has been the rise in U.S. exports of distillers grains (DDGS). Several countries are developing markets for U.S. DDGS used in livestock production. One country experiencing increasing growth is Egypt, which imported 6,400 metric tons of U.S. DDGS in the 2005-06 market year. Morocco has also emerged as a growing market for DDGS, importing 54,000 metric tons currently, with a potential for up to 600,000 tons in the near future. "We have been putting a lot of focus on introducing DDGS to the Moroccan market," said Kurt Shultz, director in the USGC Mediterranean and African office in Tunisia. Other emerging markets around the world include Iraq and India. In Iraq, USGC has focused on rebuilding the poultry industry by working with Iraq's poultry associations. "Future predictions show that the industry will increase by 25 percent within the next five years as the Council continues to promote ideas of modern trade and assists in the transfer of technical support to local farmers," said Abdella Ait Boulahsen, USGC consultant in Iraq. India has the potential to be a huge U.S. corn export market. Currently, a 15 percent duty is slowing imports into India, but USGC has been working to eliminate the duty and create a feed demand through increased poultry consumption. Jennifer M. Latzke can be reached by phone at 620-227-1807, or by e-mail at jlatzke@hpj.com. 3/10/08 Date: 3/5/08
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