The US Loses Israel’s Corn Market


May 16, 2023 | Agricultural Markets News

Reading time: 2 minutes

Israel is an insignificant producer of Corn. No Corn is cultivated for feed use. In calendar year (CY) 2022, the total planted area was around 14,000 ha. Over half of this amount is for silage, with some 6,000 ha cultivated as sweet Corn (fresh or processed) for human consumption. Popcorn grows on about 1,000 ha. Israel is entirely dependent on feed Corn and Corn imports for the starch industry. Due to water constraints (dependency on irrigation, water shortages, and high prices), farmers continue producing other higher-value crops instead of feed Corn.
FAS Tel Aviv forecasts Israel’s Corn consumption in MY 2023/23 (October – September) at 2.18 MMT, with almost no change from MY 2022/23 figures. Post is revising MY 2022/23 consumption estimates up by 360 TMT to 2.19 MMT from earlier estimates of 1.83 MMT. The increase is due mainly to the more attractive market price of Corn this year and some shipments sent to Israel earlier this year that were not offloaded due to a long operational queue at the ports. This led to not capturing these shipments in the MY figures.
Port operational queues in the past year are still long, and in some cases, vessels must wait for offloading for over a month. This bears additional costs for the importers and later reflects on the consumer prices. The volume of Corn used in some feed products (and replacing it with less expensive wheat and barley) might change throughout the year due to world commodity prices. Corn is the primary commodity used by Israel’s feed industry.
In recent years, there have also been Corn purchases by farmers and wildlife protection services – the Corn is used to feed migrating birds to keep them away from agricultural fields and inland aquaculture. Poultry and egg production drives consumption, followed by dairy, turkey, and other ruminants. Israel’s annual per capita meat consumption is estimated at 86.1 kilograms (KG) per person.
Poultry production in 2022 is estimated at 530,000 MT, with no change from the last year (official figures for the whole year have not yet been published). The demand for poultry meat in MY 2022/23 was slowed, and consumption did not reflect the natural population growth. In 2022, table egg production was 2.12 billion eggs, an increase of 9 percent from last year. Production quotas regulate egg production in Israel,
Eight feed mills control about 90 percent of the local feed milling industry. The largest feed miller controls 22 percent of the market and plans to increase production by 12 percent. There are some 150 feed centers in Israel. These are communal feed mills operated by local farming communities (i.e., Kibutzim) and sell their feed mix to the cattle industry. Fifteen of these are large feed centers servicing the most significant cattle producers, while the remaining 135 are smaller operations, selling feed to smaller producers. Each small feed center supplies feed to 100-300 cattle.

Corn Import in Israel

According to AgFlow data, Israel imported 197,755 tons of Corn from Ukraine in Jan-Apr 2023, followed by Russia (45,000 tons). In MY 2023/24, Corn imports are expected to be 2.2 MMT, of which 80 TMT are expected to be of U.S. origin. Corn has been imported mainly from Ukraine, Argentina, and Brazil in recent years. In MY 2022/23, 80 TMT of U.S. Corn was exported to Israel. 

The dramatic decline of U.S. Corn exports to Israel in the past decade is due to the competitive pricing of Ukraine and South American Corn, cheaper shipping costs, and quality concerns with U.S. Corn. Notably, in the Middle East and North Africa, U.S. Corn is increasingly perceived to be lower quality than South American or Black Sea products. Corn shipments from the United States typically arrive with more broken kernels than comparable shipments from other sources.

Other sources: USDA

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