March 5, 2011

Vietnam seeks South American corn

Following a disruption in cargoes from India, Vietnam is in the market to buy South American corn for prompt shipment to replenish domestic inventories.

Feed millers from Vietnam were in talks this week to buy some 60,000 tonnes of corn from Argentina but the deal could not be concluded as buyers cited higher prices, regional traders said.

"There was US$10-15 (a tonne) difference between bid and ask, so there was no business done," said one feed grains trader with an international trading company in Singapore. "We expect that it will be done next week as supplies are getting tight and they need prompt shipment to be done in March."

Corn prices in Vietnam have risen 11% after the country's plant protection authorities rejected 50,000 tonnes of Indian corn and soymeal because of an infestation of Khapra beetles, an industry official said on Thursday (Mar 3).

Corn prices have jumped to VND7.4-7.5 million (US$379-384) a tonne on domestic markets from VND6.7 million (US$343) in January before the cargoes from India were detained.

Still, traders said Vietnam is expected to buy soymeal from India because of competitive offers. "Corn might be difficult, but for soymeal, Vietnamese buyers will still prefer Indian origin," said another trader who sells Indian and South American meal into Asia.

Indian soymeal is quoted around US$430-445 a tonne, including cost and freight to Southeast Asia, while new-crop Argentine meal is being offered at US$455-460 for April shipment.

Old-crop Argentine soymeal for March is being quoted between US$460 and US$465 a tonne, traders said.