Trump Fears Prompt Mexico To Buy More Corn

October 11, 2016 12:00 PM

Mexico is purchasing more corn than normal from U.S. producers likely thanks to two factors: multi-year lows in corn prices and rhetoric by U.S. presidential candidate Donald Trump about building a wall along the U.S.-Mexico border. That’s according to Brian Splitt of Allendale.

“We don’t know how they’re going to pay for [the proposed wall], but it could be through trade policy,” Splitt tells host Tyne Morgan on the “AgDay” Agribusiness Update segment. “If I have the combination of those two things, if I’m Mexico, I am an aggressive buyer before we even see the election to make sure my needs are attained. I don’t want to have anything up for chance at this point.”

Meanwhile, exports to other countries are up, too. Corn exports are up 70% from the five-year average and are headed for destinations such as Brazil. China has opened the door to U.S. beef. Splitt advises against getting too hopeful these spot buys will last.

“I see this as more of a short-term issue for us,” says Splitt, noting Brazil had problems with its second-crop corn. “It could be a little bit disappointing down the road. Maybe USDA acknowledges this pace but then brings the numbers back down as we get into the first and second quarter of next year.”

Keep in mind the U.S. is doing some “catch-up work” on both corn and soybeans, with corn set to hit USDA’s sales target and soybeans running a little bit behind, Splitt adds.

Watch the complete interview with Splitt in the “AgDay” clip.



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Spell Check

Fernando Gómez
México City, AK
10/11/2016 04:38 PM

  That makes little sense. Why buy goods that are perishable now? And as Bullpuky says, it means nothing without shipping. In Mexico, we have a rather high tax on sugar-cane sodas and drinks. The exports from FEMSA and other soda-making companies are on the rise. Also, yellow corn is used for feeding livestok, and very little for human consumption (we do consume, however, lots of white corn, which is used to make tortilla bread). Makes more sense to me, given the rise in exports and the rise in the exchange rate peso-dollar (which, by the way, can be attributed partially to Trump). P.S. I had to select Alaska, since there's no "Other" option in the state list.

American Farmer
Robinson, IL
10/11/2016 04:23 PM

  Trump ain't even elected and he is increasing corn exports. Awesome.

Emerald City, WA
10/11/2016 04:24 PM

  Where do we get these ideas at? Building a wall and worried about trade policy? If that is the case Mexico better get it all shipped before January. Just having it purchased means nothing if it hasn't shipped. Should of stopped talking right about when prices are at a multi-year low. If we need to worry it better be Trump vs. China. That's the hundred ton gorilla in the room.


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