Miller Magazine Issue: 141 September 2021

26 MILLER / september 2021 NEWS Two commodity trading houses have signed a contract with the Egyptian government to build a bulk grain terminal in East Port Said. The Chair- man of the Suez Canal Economic Zone (SCZone), Yehia Zaki, and the Representative of Roots Com- modities and Rosa Grains, Haytham Nouh, signed a contract for the establishment of a bulk grain ter- minal at East Port Said. At an estimated investment cost of EGP 2.2 billion ($140mln), the terminal is forecast to handle from 1.5 million to 7.2 million tonnes of grains per year at East Port Said, Zaki said in a statement. The project, ex- pected to create about 400 direct and indirect jobs, will be established over an area of 267,000 square metres and at a length of 500 metres, he added. East Port Said Port has a distinguished location east of the northern entrance of the Suez Canal, at the confluence of three continents, and at the crossroad of the most important world sea trade route between the east and the west.  Egypt to build $140mln bulk grain terminal at East Port Said As China continues its grain buying spree, Argenti- na sorghum exports have been a beneficiary of this in- creased demand. Just in the last few months, Argentina has exported nearly 500,000 tons of sorghum to Chi- na. As a point of comparison, Argentina exported about 90,000 tons to China in total over the prior years of the decade. Current Argentina sorghum exports for 2020/21 (Oct-Sep) are forecast at 1.2 million tons, more than twice the volume of the previous year. The United States is, as the world’s largest sorghum producer and exporter, the primary supplier of this grain to China. However, the level of China’s demand relative to production has left the U.S. sorghum balance sheet very tight for 2020/21; ending stocks are currently fore- cast to be the lowest in USDA’s database. Beyond the tight U.S. balance sheet, Argentine sorghum is also sub- stantially cheaper than U.S. sorghum, potentially reflect- ing lower palatability for animals due to higher tannin levels, and has benefited from the steady depreciation of the Argentine peso against the U.S. dollar. These fac- tors make Argentine sorghum a very price-competitive grain on the world market. In the last decade, Argentina exported most of its sor- ghum to Japan. As Japan’s incorporation of sorghum into its feed rations has fallen in favor of corn, import de- mand has been declining over the period. Though Chile and Colombia were also once major export markets for Argentine sorghum, these markets have seen import demand shrivel as well. The resurgence of China sor- ghum imports will buoy Argentina’s sorghum growers, at least until the new-crop supplies become available in the United States. Argentina sorghum has eyes on China