It's graphite...intended to help the seed flow more smoothly through the planter and into the ground. As soon as he told me what it was, I remembered way back when our kids made Pine Wood Derby cars, and we put graphite on the wheels/axles to make them run faster. It's the same concept.
The seed corn is red because it's been treated with a fungicide and with other things that vary, depending on the variety of corn.
Just in case you ever wondered. :)