New Articles

Global Corn Market Maintains Steady Growth Despite Lower Bioethanol Demand


Global Corn Market Maintains Steady Growth Despite Lower Bioethanol Demand

Driven by rising demand from the food industry and favorable weather, global corn production increased significantly in 2020. The rise in prices made the raw corn-based production of bioethanol unprofitable amid the low cost of traditional fuels due to the pandemic, resulting in the closure of some distilleries. In the future, the growing demand for alternative fuels is expected to offset this shift and promote the corn market.

IndexBox has just published a new report: ‘World – Maize – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

Key Trends and Insights

Driven by rising demand from the food industry and favorable weather, global corn production grew by 2% to 1,435М tonnes in 2020 (IndexBox estimates). Brazil (+7M tonnes), South Africa (+1.2M tonnes) and India (+1.2M) tonnes indicated the most substantial increase in output.

Global corn exports saw a 6% rise, to 168.2Ðœ tonnes. In 2020, global corn prices increased substantially, from $170 per tonne in March 2020 to $240-280 per tonne in March 2021. Argentina retained the lowest competitive export prices in 2020 ($239 per tonne, FOB).

High corn prices resulted in lower competitiveness of corn bioethanol, which aggravated the pandemic-related drop in demand for biofuels. This led to bioethanol plants being forced out of production: according to the Renewable Fuels Association (RFA), approx. 20 out of the 200 ethanol production facilities in the U.S. remain idle; a further 20 have cut production. The volumes of corn intended for biofuel production were redirected to growing exports.

In the period to 2030, the global corn market is set to expand to 1.978M tonnes. Increasing corn consumption in the food sector driven by steady population growth remains the key development factor in terms of market expansion. The market for alternative fuels may yet see significant development, thereby increasing the demand for corn, should environmental standards become more stringent and a carbon tax on greenhouse emissions be imposed.

China, the U.S. and Brazil Consume more than Half of Global Corn Production

The countries with the highest volumes of maize consumption in 2019 were China (523M tonnes), the U.S. (322M tonnes) and Brazil (60M tonnes), with a combined 64% share of global consumption. Mexico, Indonesia, Argentina and India lagged somewhat behind, together accounting for a further 9.2%.

In value terms, the largest maize markets worldwide were China ($170.8B), the U.S. ($106B) and Mexico ($22.5B), with a combined 60% share of the global market. Indonesia, Brazil, India and Argentina lagged somewhat behind, together comprising a further 8.2%.

The countries with the highest levels of maize per capita consumption in 2019 were the U.S. (978 kg per person), Argentina (619 kg per person) and China (359 kg per person).

Brazil Leads in Exports

Brazil (43M tonnes), Argentina (29M tonnes), Ukraine (27M tonnes) and the U.S. (26M tonnes) represented roughly 79% of total exports of maize in 2019. The following exporters – Romania (4.6M tonnes), France (3.7M tonnes), Russia (3.1M tonnes), Hungary (3M tonnes), Paraguay (2.7M tonnes) and Bulgaria (2.6M tonnes) – together made up 12% of total exports.

In value terms, the U.S. ($8.9B), Brazil ($7.3B) and Argentina ($6B) were the countries with the highest levels of exports in 2019, together comprising 62% of global exports. These countries were followed by Ukraine, France, Romania, Hungary, Russia, Bulgaria and Paraguay, which together accounted for a further 28%.

In 2019, the average maize export price amounted to $229 per tonne, approximately reflecting the previous year. Overall, the export price, however, showed a pronounced contraction. The pace of growth was the most pronounced in 2017 an increase of 13% year-to-year. The global export price peaked at $301 per tonne in 2013; however, from 2014 to 2019, export prices stood at a somewhat lower figure.

Source: IndexBox AI Platform


Will Usage of Abaca Fiber Face Masks During COVID-19 Help to Reduce Wastes During the Pandemic?

With the demand for face masks and other PPE equipment soaring high worldwide due to the dreaded COVID-19 pandemic spread, it is quite impossible to not ignore the burgeoning plastic wastes created by their disposal. According to estimates by Greenpeace Taiwan, the country produced and used about 1.3 billion surgical masks during the apex of the pandemic- from early February to mid-May. This number generates over 5,500 metric tons of general waste within a span of 3 months.

Such numbers signify that although face masks add to the general protection during the pandemic situation, they also contribute massively towards environmental degradation and landfill pollution, demanding a bio-degradable solution and substitute. This has gradually led to the emergence and usage of abaca fiber-based surgical and sustainable masks.

Recently, a Philippines-based firm- Salay Handmade Products Industries, Inc. had come forward to commercialize and supply masks made from raw abaca fibers, which boast of the property to decompose in just two months. Abaca fibers are generally rooted from banana leaf and are considered to be strong as polyester but high on the sustainability front. A proper validation on the use of abaca fibers for the production of face masks is offered by the country’s Department of Science and Technology. The researchers found that abaca mask is potent of absorbing nearly 3% to 5% of total water applied, while N95 and surgical masks absorbed 46% and 0.17% respectively.

Essentially, the abaca masks repel water far better than an N95 mask and is considered to be extremely safe for use. Although these abaca masks are eco-friendly, they are also quite highly-priced. That said, environmentalists concerned with the plastic crisis plaguing the entire planet will hopefully witness the benefit of investing in biodegradable masks providing an impetus to the global abaca fiber market.

Abaca fibers, also known as ‘Queen of natural fibers’ offer a huge potential to be used as a renewable bio-resource and are claimed to have a high content of lignin (about 9%) and cellulose (roughly 77%) that provide significant resistance to abrasion, traction, UV rays, and saltwater. These properties allow the fibers to be abundantly used for various industrial or extra-industrial applications across automotive, shipping, construction, pulp and paper, furniture, and textile industries.

Why are abaca fibers gaining massive momentum across the automotive industry?

It was in late 2004 that a major automotive giant, Chrysler-Damlier had explored the possibility of incorporating abaca or banana fiber in polypropylene thermoplastic as a substitute to glass fiber used in the exterior of most of the cars. In fact, it was reported that the company was able to demonstrate that PP composites reinforced with abaca fibers showed high structural as well as tensile strength similar to that of glass fiber. Additionally, abaca reinforced PP composites are relatively lighter compared to glass fiber, which could lead to enhanced fuel and energy saving for vehicles while also reducing their weight by up to 60%.

Elaborating further, the DOST Industrial Technology Development Institute sees abaca’s potential as a roofing material for various public utility vehicles. The polymer’s low heat conductivity could help prevent most of the sun’s heat from entering the automobile’s cab, which is especially helpful during the long summer months.

Speaking of the importance of abaca fibers in the automotive industry, the Philippines, which currently produces about 85% of the world’s abaca firmly states that the use of these fibers could potentially augment the country’s local automotive industry in the years to come.

Abaca fiber market trends across the Philippines

The Philippines has over the years remained a dominant region for the abaca fiber market as it stands to be the largest global producer of abaca fiber, ever since its introduction. Reports state that the region produces about 80% of these fibers in about 130 thousand hectares of land. The market is witnessing a massive boost owing to the mounting demand for toys, gifts, and houseware products. Not only this, rising customer inclination for lifestyle products is also stimulating the industry progression.

What has been fueling the industry growth in the Philippines is the introduction of several initiatives that look toward the promotion and production of high-quality abaca fiber in the region. The federal government is responsible for mandating and creating initiatives and measures which strengthen the hold of the country in the overall abaca fiber market while also creating additional growth opportunities for new market players to foray into the regional market.

Although the market has been expanding prolifically over the past few years, it is currently facing some challenges which might hinder its growth in the near future. A major disadvantage being the application of these fibers as reinforcement. Since abaca fibers cannot blend uniformly with polymer composites owing to their natural properties, this complicates the composite fabrication process in the textile industry, limiting its use in the overall textile business space.

Nevertheless, abaca fibers’ eco-friendly and bio-degradable properties have enabled the global abaca market to grow profusely over the span of 2020 to 2026.