U.S. Grains Council gathers with NSP in San Antonio

This year, the National Sorghum Producers are meeting in conjunction with the U.S. Grains Council in San Antonio.

The USGC began its International Marketing Conference and Annual Membership meeting the morning of Feb. 10, with a 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 is 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.

The combined gathering of the U.S. Grains Council and the National Sorghum Producers will continue through Feb. 13. Be sure to check www.hpj.com for updates.