U.S. Sorghum Ship Bound for China Heads for Saudi Arabia
A ship carrying 69,842 tonnes of sorghum from the United States bound for China has switched its destination to Dammam, Saudi Arabia.
The BTG EIGER departed with U.S. sorghum from Archer Daniels Midland Co’s Corpus Christi Grain Elevator in Texas on March 3, according to the U.S. Department of Agriculture’s (USDA) Federal Grains Inspection Service.
Several ships carrying cargoes of sorghum from the United States to China have changed course since Beijing slapped hefty anti-dumping deposits on U.S. imports of the grain last week, trade sources and a Reuters analysis of export and shipping data showed.
There are 22 vessels carrying U.S. sorghum on the water that were loaded for China, the USDA’s data showed.
China imports sorghum for use in livestock feed and to manufacture the liquor baijiu.
Saudi Arabia is not a big sorghum importer, but it is the world’s tenth-largest buyer of corn.
The country is forecast to import 4.5 million tons of corn this year, USDA estimates showed.
Some of the sorghum is expected to be used to replace corn in animal feed rations.
Saudi Arabia has nearly doubled purchased of U.S. corn this marketing year due to a combination of favorable government policy shifts, competitive prices and market development work by the U.S. Grains Council (USGC).
Thus far in 2016/2017 (September-June), Saudi Arabia has purchased 2.07 million metric tons of U.S. corn (81.5 million bushels), up significantly compared to the prior five-year average of 861,000 tons (33.89 million bushels). Saudi Arabia has also ramped up purchases of U.S. ethanol substantially over the last two marketing years, with 2.5 million gallons sold in 2016/2017 plus more than 25,600 tons of U.S. distiller’s dried grains with soluble (DDGS), an ethanol co-product.
Changes to local policy have helped spur these shifts. In 2011, the Saudi government added 14 new feed ingredients to the national animal feed subsidy scheme, the major driving force between what types of feed grains, co-products and forages are imported by the Saudi feed, livestock and poultry industries. That new list includes U.S. DDGS and corn gluten feed/meal (CGF), opening the door for increased exports.