On Tuesday, April 8, the USDA confirmed a sale of 240,000 tonnes of US corn into Spain for delivery in the 2024-25 marketing year. This left market participants puzzled as they did not expect this sort of trade, given the looming tariff on US corn exported into the EU that will be implemented from next week.
Earlier in March, the European Commission announced that it would restore its 2018 and 2020 rebalancing measures in response to recent US tariffs on aluminium and steel. The Commission’s countermeasure includes a 25% tariff on US corn imports. The tariff was scheduled to be imposed from April 1, but it was later delayed to be introduced in mid-April.
The import tariff is about to take place soon, so fresh trades could be risky, Fastmarkets heard. Market sources suggested that some trading, still being published now, may have happened just before the tariffs were confirmed, so it is still possible that it will be delivered before the tariff comes into force.
“If they impose the counter-tariffs in mid-April and allow for sales on the books to be executed in a given amount of time, maybe it makes sense and is worth the risk,” a US broker told Fastmarkets.
The response by the EU
Further details about the EU’s tariff implementation were not clear. The Commission did not specify whether volumes sent during a given period will avoid the import tariff or whether the tariff will be applied depending on the bill of lading or the actual discharge in EU ports, leaving trade sources guessing.
“The whole market is asking about that; for us, it does not make any sense — it seems like a done deal that tariffs are coming,” a trader said.
It also comes as US corn is currently the cheapest origin worldwide. The latest offers for CFR Spain corn stood around $245 per tonne, compared with $241 per tonne FOB from Ukraine for April loading dates.
No offers from Brazil for the same loading dates were heard amid limited offers until the new crop arrives, starting in August.
