Dominican Corn: Brazil Exports Record High Volume
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Corn production in the Dominican Republic is limited. In MY 2020/21, local production declined to 46,414 MT. On average, annual production totals 45,000-50,000 MT, primarily produced in the southwest region of the country. Generally, domestic production represents between 1-3 percent of total consumption. Due to the high international prices for Corn, the Ministry of Agriculture of the DR declared during CY 2020 its intentions to increase the planting of Corn and sorghum at the national level. However, the intention was not translated into specific policies; therefore, the plans were not implemented.
For MY 2022/23 (October 2022/ September 2023), the USDA forecasts total consumption of Corn at 1.6 million MT, up 3 percent from the projections for 2021/22. After being negatively impacted by the COVID-19 pandemic, local demand for poultry and egg products has recovered quickly, especially with increased demand from the HRI sector. Corn is an essential ingredient for animal feed used in the Dominican poultry, egg, and pork industries.
Livestock producers import significant volumes of yellow Corn for animal feed. According to trade sources, close to 70 percent of Corn supply is consumed in broiler and layer production, while swine consume about 15 percent, and the food processing industry utilizes around 11 percent. The remaining five percent is consumed by cattle, mainly from the dairy sector. Storage facilities are limited and vary considerably among feed producers. The collective storage capacity is estimated to be around 120,000 MT, while storage capacity utilization is usually estimated at approximately 65-70 percent.
Dominican Corn Trade
For MY 2022/23, the USDA forecasts imports of 1,550,000 MT, up from the 1,500,000 MT projected for MY 2021/22. Corn is purchased by a small number of companies and buying groups composed of producer associations. The most important players are JUPROPE, Consejo, ASODEP, APROAMOLI, and Pollo Cibao. Nearly 80 percent of all Corn is imported by these groups.
The United States lost its dominance in the local Corn market in MY 2008/09 due to persistent complaints from local consumers concerning dust levels, grain cracking, mycotoxins, lack of yellow color, and milling yields. At the same time, South American suppliers, mainly Brazil and Argentina, offered a more attractive product, increased availability, and improved logistics.
In MY 2020/21, U.S. market share declined to 31 percent, down from 36 percent in MY 19/20. It is expected that this trend to continue in subsequent MYs, as local customers are already buying significant quantities of mid- and end-of-year Corn futures from Brazil and Argentina due to quality and price differentials compared to U.S.-sourced Corn.
Brazil continues to be the strongest competitor for Corn in the DR market. During MY 2020/21, Brazil supplied 48 percent of Dominican imports. In the case of Argentina, during MY 2020/21, the country had an exponential growth of exports to the DR, supplying 307,776 MT. As of 30 March, in MY 2021/22, Brazil continues its dominance in the market, providing 89 percent of total Dominican imports. According to AgFlow data, Brazil shipped 1.1 million tons of Corn in Jan – Oct 2022, followed by the United States (0.5 million tons) and Argentina (0.1 million tons).
Dominican official exports of Corn have not been significant. According to the National Directorate of Customs (DGA), the DR exported approximately 732 MT of Corn during MY 2021/22; 90 percent of that total was destined for Haiti. However, anecdotal reports showed that informal exports of Corn meal and grits to Haiti have grown in the last year reaching between 3,500-4,000 MT during MY 2021/22. Political instability in Haiti will lean toward continuing this trend in the short term.
Other sources: https://www.usda.gov
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