February 2, 2009

Japan is expected to import less US corn this year, as China is expected to resume exports after a record harvest and because buyers are seeking alternatives due to low freight costs.

Australian barley, for example, now costs US$150 per tonne compared with over US$200 per tonne for US corn, an industry source said.

A strong yen has boosted imports of broiler chicken and pork, lowering meat prices and affecting local farmers. As a result, domestic feed use is seen to fall in the next several months, which would curb corn imports, said traders.

Japan is the world's largest corn importer, as it grows hardly any corn. Last year, Japan imported 10.7 million tonnes of corn for feed use, down 9.8 percent on-year.

Corn imports from the US totalled 10.6 million tonnes in 2008, down 4 percent from a year ago and the lowest since 1998, according to preliminary government trade data.

Japan's feed corn imports peaked at 12.4 million tonnes in 2005, but have since been on the decline.

Japan imported 52,000 tonnes of Indian corn last year, but traders said it may be a temporary boom due to underlying fears of possible toxic contamination. Japan also imported corn from Argentina, Thailand, Vietnam, Brazil, Paraguay and the Black Sea region.

"We're interested in anything cheap," a senior manager at a Japanese feed maker said. "Brazil has been recommended as South Korea bought some recently."