November 10, 2006

USDA: South Korea feed wheat import to fall, feed corn to rise
 

South Korea's feed wheat import forecast is lowered to 1 million tonnes, about 35 percent lower than last year, due to the expected fall in feed wheat availability from traditional suppliers, reports the US Department of Agriculture in its November 3 report.

Majority of feed wheat imports will be from China. Milling wheat imports are forecast to increase minimally to 2.3 million tonnes, according to the report. Despite the trade implications of the Australian drought, South Korea will continue to place a high priority on purchasing Australian milling wheat.

Meanwhile, corn import is expected to grow as livestock producers will switch to corn due to the tight availability of feed wheat imports, predicts the USDA report. Corn estimate is forecast at 9 million tonnes, up 3 million tonnes from the previous forecast. 

Reported corn contract data indicates that Korean feed millers have made contracts on an optional origin basis, designating China as the supplier. The delivery could be between November 2006 and February 2007. Optional origin contracts with delivery on and after March 2007 are expected to favour US corn. However, strong competition from China will prevent significant growth in imports of US corn, which are forecast to reach 6 million tonnes in 2006/07.

Korea's imports fell about 1.8 percent in 2005/06 compared to 2004/05. Feed corn imports dropped by 3.4 percent from last marketing year while food corn imports increased by 4.2 percent.

Total corn consumption is forecast at 9.1 million tonnes for 2006/07, of which 2.1 million tonnes is used for food and 7 million tonnes for feed, according to report.

For the full USDA report, please click here