Maize Seaborne Trade
Chatzimichail Dimitrios, MBA in Shipping 2013 -14
TABLE OF CONTENTS
1.1 Physical Properties
1.2 Parameters Affecting Commodity Trade
Maize supply and demand of commodity
2.1 Major Players
2.2 Commodity Price Fluctuations
International Seaborne Trade
3.1 Shipping Services Supply & Demand - Freight Rates
3.2 Maize Seaborne Transport Particularities
Thoughts about the Future
Maize is one of the most important grains cultivated worldwide mainly for human feed and animal food. Commodity supply heavily depends on weather conditions, prices and also regulatory mandates with regard s to ethanol production, but demand is affected by income, price and changes in population life standards and dietary habits. Both supply and demand of the commodity, are expected to rise in the future. By nature seasonal, and irregular in volume and route, necessitates a seasonal seaborne trade, accommodated through bulkers, mainly Handymax and Panamax vessels. Freight rates are fluctuating in accordance with bulk grain indexes, until recently at very low levels compared to the historical average, due to the oversupply in bulk carriers fleet. However recently rising freight rates provide a fair degree of optimism with regard to the increasing demand for bulk carriers. All in all, maize trade will be steadily growing in the years to come, based mainly in increased demand from developing countries and new players in the supply side.
1.1 Physical Properties
Maize is one of the oldest human-domesticated plants, providing the 3rd largest planted crop after wheat and rice. It is a crop that displays more than sufficient geographic adaptability, both in the north and southern hemisphere. Harvesting periods span from September to November in northern hemisphere and from April to May in Southern Hemisphere, thus reducing seasonality of the production worldwide. The majority of the crop is used as livestock feed; the remainder is processed into a range of food and industrial products including starch, ethanol for use as a fuel, oil, protein, alcohol and sweeteners such as high fructose maize syrup and maize oil. Due to all of the above food applications, maize has a pivotal role in diets worldwide. According to Abdolreza A. (2006), on average, around 460 million tones, or 65 percent of total world maize production is used for animal feed purposes while around 15 percent is used for food and the remaining mainly destined for various types of industrial uses. The diversity in usage of maize stems from its multiple nutritional characteristics. Tables 1 and 2 indicate the quantities of products that can be produced from one tone of maize, and the quantities of several kinds of meat tat can be produced by one tone of maise respectively.
Table 1: What can One tone of Maize produce (Source: Iowa Corn)
Table 2: How much meat can One tone of maize produce
Depending on their colour and taste, maize grown around the world is generally categorized into two broad groups:
yellow : Yellow maize constitutes the bulk of total world maize production and international trade. It is grown mostly in northern hemisphere countries where it is traditionally used for animal feed.
White: White maize, which requires more favourable climatic conditions for growing, is produced in only a few countries, the United States, Mexico and in southern Africa. White maize is generally considered a food crop and has usually higher market prices. As with other cereals, for commercial and marketing purposes, maize is also assigned different types of grades and classes depending on a set of physical characteristics and qualities such as the minimum test-weight, feeding values and foreign material. In the United States, for example, maize classes are determined on the basis of colour and are graded from 1 to 5. 1.2...
Abdolreza A., 2006, Maize International Market Profile, Background paper for the
World Agricultural Supply and Demand Estimates, USDA, WASDE-522, Sept 12, 2013,
Available at: < http://usda01.library.cornell.edu/usda/current/wasde/wasde-09-122013.pdf>
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