Canada’s bountiful corn harvest is flowing across the Atlantic into feed rations for Ireland’s cattle herd, even as exporters struggle to move other crops through the bottlenecked Canadian transportation system.
Canada, which was a net corn importer until recent years, reaped a record 14.2-million-tonne corn crop in 2013. Most of the crop stays where it is grown in the provinces of Ontario, Quebec and Manitoba to fuel ethanol plants run by Husky Energy Inc., GreenField Ethanol and Suncor Energy Inc.
But from August through December, the first five months of Canada’s 2013-14 crop marketing year, exporters shipped about 185,000 tonnes of corn, with nearly three-quarters of that headed for Ireland, according to the Canadian Grain Commission.
“With the (corn) price increase over the past few years, we’ve seen acres go up in Canada, and we’ve gone to (being) an exporter now,” said Mark Cumberbatch, corn trader at private Canadian grain handler Parrish & Heimbecker.
Most Canadian corn sales to Ireland are for feeding cattle in the world’s fifth-largest beef exporter, he said.
Canada’s total corn exports this year are already large compared with volumes in most years of the past decade. They could fall short, however, of 2012-13 shipments, which totalled more than 600,000 tonnes due to brisk sales to the United States after its severe drought.
Corn is abundant this year, with the U.S. Department of Agriculture forecasting record global production.
Freight rates for moving crop across the Atlantic have been competitive at times with rates from the Black Sea region, giving Canadian sales to Europe an extra push, Cumberbatch said. Greater corn supplies than the domestic market can handle have also added fuel to exports, he said.
While corn, grown largely in Eastern Canada, is flowing freely, crops like wheat, canola and barley grown in Western Canada have been harder to move.
Record Western Canada crops and frigid weather have overwhelmed railways trying to move them from the Prairies to Pacific Coast ports, leaving country elevators and farm bins full.
Eastern crops generally don’t travel as far to ports, leaving them less reliant on railways than western wheat and canola, Cumberbatch said. The St. Lawrence Seaway provides access for eastern crops to the Atlantic Ocean, although the Great Lakes are closed for shipping during winter.
Canadian corn also looks appealing to European buyers because of problems in Ukraine.
Freezing weather causing ice on roads in Ukraine has delayed deliveries of corn, also called maize, and prompted many buyers to turn to rival exporters, including the United States and Canada.
“Ukrainian maize prices have risen a fair bit and French maize is nowhere near competitive,” said a European corn trader, speaking on condition of anonymity.
“Buyers are going to look at whatever’s cheapest. It’s possible 300,000 to 400,000 tonnes of Canadian maize will be imported by the EU this season, coming in through Ireland, Britain, Scandinavia, Rotterdam and maybe even Spain.”
If Canadian farmers continue to grow big corn crops, shipments to Europe may become more common, Cumberbatch said. The Canadian transportation system is usually reliable, unlike systems in some other countries, he said.
Typically, Canadian corn exports are lacklustre. The notable exception was 2010-11, when Canada shipped 1.3 million tonnes of corn, including to destinations like Spain, due to lower European production of coarse grains that year.