June 25, 2007

 

Asia Grain Outlook on Monday: Premiums may fall on weather, harvest

 

 

Premiums for grains delivered to Asia may fall in the week ahead on better weather for corn and soybean planting, and the approaching wheat harvest in the U.S. will pressure prices.

 

In the Chicago Board of Trade Friday, corn and soybean futures were lower as rains fell in U.S. planting areas, while the harvest weighed on wheat.

 

In Asia, corn buying for future months this year may start gathering pace in the coming weeks as traders want to lock in prices for the new U.S. corn crop, which will likely be harvested from September.

 

Chinese soybean crushers are also expected to increase their imports this week, as premiums for soybean delivered to China have come down over the past several days.

 

According to commodities analysis form JCI Shanghai, Chinese crushers booked seven to nine soybean cargoes in international market last week, after an almost negligible purchase in the preceding week.

 

Most of the newly-booked soybean shipments this week are from Argentina, with small amounts from the U.S., all for shipment during July and August, JCI said.

 

In the past week, the Korea Corn Processing Association bought 55,000 metric tonnes of optional-origin corn from trading house Toepfer in a tender for September delivery.

 

The entire shipment will be supplied at US$242.84/tonne for South American corn, or US$232.84/tonne for Chinese corn.

 

Last week, Taiwan's Breakfast Soybean Procurement Association, or BSPA, bought 60,000 tonnes of Brazilian soybean for delivery between July 22 and Aug. 8.

 

BSPA will pay a premium of 161 U.S. cents a bushel to the Chicago Board of Trade September contract for the shipment.

 

In deals expected over the next few weeks, Japan's Ministry of Agriculture is seeking a total of 127,000 tonnes of wheat from the U.S., Australia and Canada in a tender to be concluded Wednesday.

 

Meantime, the government of Bangladesh is seeking to import 200,000 tonnes of optional-origin non-basmati parboiled rice, in a tender to be concluded on July 17.

 

It also seeks 212,000 tonnes of optional-origin wheat, in a tender to be concluded July 17.