TRADE MISSIONS ARE VITAL TO ILLINOIS AGRICULTURE

As the Value Enhanced Projects Director for the Illinois Corn Growers Association/Illinois Corn Marketing Board, you might not think that I’ve traveled all over the world and visited with people from nearly every country as they traveled to IL. But I have. And this “exchange program” of visiting with other countries and having other countries visit us is a vital part of our programming to help corn farmers in IL.

Illinois is a massive exporter of corn. In fact, reports yesterday from the US Department of Agriculture (USDA) indicate that agriculture as a whole is in our second highest year on record for agricultural exports. Agriculture is one of the only major sectors of the American economy with a trade surplus, which is expected to be $30.5 billion this year.

One of the ways that we keep that export market vibrant and growing is to meet with buyers in other markets to tell them about our products. In much the same way that a printing company sales rep might knock on your door to market their printing services or the Schauwn man stops by every week, we simply make appointments to meet with buyers at their homes and businesses, even if those businesses are an ocean away. This is really the only way to truly understand what a buyer needs, the quality they are looking for, the price they expect, and how we can work together to deliver on that demand.

Buyers also want to come to Illinois to see how the products are grown or created. Company reps from China looking to buy dried distillers grains (DDGS) from our Illinois ethanol plants might schedule a trip to our state and I will set up visits to ethanol plants for them, both educating them about the industry and connecting them with potential Illinois suppliers. This is an important way that we can add value to Illinois corn – by creating new markets for Illinois corn by-products.

Representatives from other countries come to Illinois for other reasons too. Sometimes they simply want to learn about US agriculture and experience planting or harvest. Sometimes they want to discover our methods of livestock production and how corn and DDGS fit into our feed rations. They may want to see how Illinois farmers live. But even these discovery missions make important connections between Illinois farmers and overseas buyers that we simply can’t ignore.

In the past year, I have worked with potential buyers from Mexico, Vietnam, Korea, China, Japan, Panama, Brazil, Central America, Algeria, Libya, Egypt, and more.

Conversely, Illinois farmers need a knowledge of overseas markets to try to find ways to fulfill those market’s needs. Sometimes, experiencing a culture first hand helps Illinois farmers see markets that have never before existed. One good example is “chicken paws” that are coveted in the Chinese market. These delicacies are simply the feet of the chicken that US meat processors used to just throw away. Visiting and making connections with Chinese buyers helped us understand that there is a market for those extra parts of the chicken and now our US chickens have more value. And, of course, Illinois corn feeds those chickens so value in the poultry market is a good thing for both of us.

Illinois farmers have recently been to missions in Brazil, Mexico, Panama, and China just to name a few.

In Panama, IL Corn leadership met with the Panama Poultry Buyers Association who was considering switching their corn purchase from US Corn to Argentine Corn. After visiting with them twice in Panama City and once in Illinois, we have been able to maintain that market and address their concerns. They are still buying 95% of their corn from the US.

Also in Panama, we visited the Panama Canal. Current upgrades to the Panama Canal will double their capacity to ship grain, but the America’s failing infrastructure including our 80 year old locks and dams, leave us lagging behind in the global transportation system. It is very important for our Illinois corn farmers to understand Illinois’ precarious position in global infrastructure so that they can lobby their elected officials appropriately and hopefully resolve this issue.

Regarding upcoming trade missions, at the end of September, I will spend the week with a company from the Dominican Republic. Two years ago, SID Grupo was buying 100% hard endosperm corn from the US. Likely, because of our position on the Mississippi, Illinois, and Ohio Rivers, much of that purchase was Illinois corn, to the tune of about 3.2 million bushels per year. Last year, our hard endosperm corn quality was poor so they switched their purchases to Argentine corn. In September, I will hopefully help them re-establish relationships with sellers of hard endosperm corn here in Illinois and we have several meetings set up with specialty grains shippers to regain that market and renew those relationships. $13 million dollars in grain sales is at stake, but the economics becomes much larger when you consider the entire production chain.

Traveling may seem glamorous, but in the end, Illinois Corn’s trade missions are about education and markets. After all, the near record exports we’re experiencing this year are the economic engine helping to pull America out of the recession. Our “exchanges” are simply programs that are too important to ignore.

Phil Thornton
ICGA/ICMB Value Enhanced Project Director