October 28, 2003

 

 

South Korea's Nonghyup Feed Inc Bought 45,000 Tons of Chinese Feed Wheat

 

South Korea's Nonghyup Feed Inc said on Tuesday it would receive 45,000 tons of Chinese feed wheat on November 20 after a 20-day delay but denied market talk that the deal had been cancelled.

 

There was a talk in the Chicago market that China had cancelled the sale of 45,000 tons of feed wheat to South Korea because it wanted to maintain its stocks.

 

"We expect Huaxing to deliver the grain by November 20, although they said the shipment had been delayed because of a problem in issuing an export licence in China," a Nonghyup Feed official told Reuters by telephone.

 

"We don't think they will fail to delivery it," he said.

 

In May, Nonghyup Feed bought 45,000 tons of feed wheat from Dalian Huaxing Enterprise Co Ltd in private talks, closing at $122.80 per ton C&F for arrival at the end of October at Inchon and Ulsan. The deal price excluded $0.75 per ton of port delivery charges.

 

Dalian Huaxing has paid around $555,975, which is 10% of the deal value, as a deposit to guarantee delivery.

 

Asked if there was a possibility of the shipment being cancelled, Dalian Huaxing's Seoul agent said: "We are in talks with Nonghyup to delay the shipment but we will deliver it."

 

Meanwhile, Nonghyup Feed has bought another 45,000 tons of Chinese feed wheat from Concordia in private talks early this month, the Nonghyup Feed official said.

 

The purchases are composed of 20,000 tons at $140.90 per ton C&F for arrival in late November at the ports of Inchon and Ulsan, and 25,000 tons at $142.50 per ton C&F for arrival on December 15 at Kunsan and Ulsan.

 

The deal prices excluded $1.50 per ton of delivery charges. "We bought it considering the price was competitive compared with rising corn and feed wheat prices," the Nonghyup Feed official said. Within a month, feed wheat price rose to over $150 per ton.

 

Last Wednesday, the Korea Feed Association bought 25,000 tons of optional-origin feed wheat from Concordia at $152.95 per ton C&F for February 10 arrival at Kunsan and Ulsan, including port delivery charges.