In a historic turn of events, Bangladesh recently purchased almost 100,000 metric tons (3.9 million bushels) of U.S. corn, the largest quantity purchased by the country since 1989 when the U.S. Department of Agriculture’s (USDA’s) Global Agricultural Trade System (GATS) first began recording sales. These sales are directly attributable to U.S. Grains Council (USGC) programming and educational activities to inform Bangladeshi buyers of the current market situation.
The Council has been very active and engaged in Bangladesh for the past two years, including bringing a strong contingent of Bangladeshi corn and distiller’s dried grains with solubles (DDGS) buyers to the Export Exchange 2014 conference. This long-term commitment and investment into the country laid the groundwork for USGC staff to meet with important grain buyers when a window of opportunity opened earlier this year.
In April, USGC staff from South Asia traveled to India, Bangladesh’s main corn supplier, to meet with local end-users and traders. Learning that corn exports from India were hard to come by and uncompetitive in the global market, they planned follow-up visits in Bangladesh in August along with technical experts and USGC India Consultant Amit Sachdev to share information with Bangladeshi buyers about how alternative sources of corn would be more economical.
‘The Council met with Bangladesh’s major importers and end-users to educate them on market trends, quality analysis, arbitrage opportunities and freight spreads – in other words, to arm them with the proper information for diversifying their grain origination,’ Sachdev said. ‘This is an example of the Council’s technical and trade servicing efforts at their finest.’
During these meetings, USGC staff used the Council’s corn quality reports to highlight U.S. corn’s limited mycotoxin content and to educate Bangladeshi buyers on the harmful effects of common mycotoxins like aflatoxin. In South Asia, mycotoxins are a major problem in locally-produced corn due to poor growing conditions, making high-quality, imported corn enticing.
Within a week of the USGC visits, there were informal reports of U.S. corn purchases by buyers in the country and now, almost a month later, official U.S. corn purchases have shown up on export documents.
This new success, however, does not mean barriers to U.S. corn purchases in this market have been eliminated.
‘Bangladesh is a challenging market,’ said Kevin Roepke, USGC regional director for South Asia. ‘Its policy toward genetically modified crops is difficult to navigate and duplicative, with no corn biotech traits officially-approved for use in animal feeds. The country’s ports also have a low discharge rate, making it a premium market.’
While Bangladesh still has barriers to trade in place, the Council has laid the groundwork for further collaboration and development of this promising market.
‘Bangladesh has half the population of the entire United States in an area the size of the state of Georgia with increasing poultry and fish consumption,’ Roepke said. ‘This creates future opportunities for U.S. coarse grains and co-products exports to this market.’