June 15, 2010

 

Japan's corn imports may lose 2.1%

Japan's corn purchases may drop by 2.1% this year on FMD outbreak that has spurred a mass cull of pigs and cattle, predicts Unipac Grain Ltd.

 

Feed-corn demand may decline by about 250,000 tonnes from last year's 12 million tons, said Nobuyuki Chino, president of the Tokyo-based grain trader. The government is culling 2.1% of the country's swine herd and 1.5% of its cattle and cows to prevent the disease from spreading beyond Miyazaki prefecture in southern Japan.

 

The cull will cut feed demand, leading to lower production by feed makers such as Marubeni Nisshin Feed Co. Corn is the largest ingredient in Japanese animal feed, representing 48% of the total, according to data from the Ministry of Agriculture, Forestry and Fisheries. Reduced purchases by Japan may extend the grain's 10% decline this year in Chicago.

 

"Importers are going to decrease corn purchases gradually. If the disease spreads to other prefectures, demand may weaken further," said Chino, who has traded grains for three decades and worked for Continental Grain Co. of the US before establishing his company in 1999.

 

December-delivery corn on the CBOT declined 0.7% to US$3.7225 a bushel at 11:28 a.m. in Tokyo.

 

Japan's feed production grew 1.2% to 24.8 million tonnes in the year ended March 31, expanding for a fifth-straight year, ministry data show. Output may drop by 480,000 tonnes this year.