July 16, 2008

Japan increases feed wheat tenders in response to market volatility

Japan's Ministry of Agriculture is starting to conduct import tenders for animal-feed wheat twice a month, instead of once every two months as previously, a ministry official said on Tuesday (July 15, 2008).

The change, effective from this week, comes as users have said they want to buy wheat, an alternative feedstock to corn, in a more volatile market.

The change also applies to imports of barley for feed use, he said.

Japan buys wheat and barley under its simultaneous buy and sell (SBS) system, which allows users to negotiate directly with trading firms and decide the grain's origin, price and quantity before together placing bids to the government.

The ministry has said it will buy 200,000 tonnes of feed wheat and 1.41 million tonnes of feed barley in the fiscal year to next March, unchanged from the previous year.

The ministry has not considered revising import quotas for feed wheat and feed barley as cumulative imports so far have not reached the planned volumes, Takahashi said.

In the last SBS tender in June, the ministry bought 82,000 tonnes of feed barley and 9,000 tonnes of feed wheat, both falling well short of the amounts it wanted to buy. It had planned to buy up to 301,000 tonnes of feed barley and 63,000 tonnes of feed wheat.