May 15, 2008

South Korean buyers may withhold corn purchasesuntil mid-June 

South Korean corn buyers may not resume large-scale corn imports until mid-June, a buyer in a Seoul-based broking firm said Thursday (May 15, 2008).

"Korean feed mills are well-stocked up to October and November, so they are in no hurry to buy," said the buyer.

South Korean feed companies usually buy corn from the US and China, but as China is clamping down on corn exports to contain domestic inflation, South Korean buyers now rely on the US.

However, high ocean freight cost and the high prices of US corn are deterring Korean buyers.

Shipping corn from US to South Korea costs around US$124 a tonne. The buyers also find the FOB price of US corn, at around US$375/tonne, on the higher side.

However, traders realize corn prices are likely to remain bullish through the year, as corn is losing acreage to soy and wheat in the US this year.

South Korea, which is one of the world's biggest corn importers, is likely to import 8.8 million tonnes corn in the 2007-08 (October-September) marketing year.