August 14, 2008

Japan's demand for barley up, wheat down, in latest SBS tender

Japan's Ministry of Agriculture aims to buy 100,000 tonnes of feed barley via a tender under the the simultaneous buy and sell (SBS) system for delivery by Nov. 30, a ministry official said on Wednesday (August 13, 2008).

The country is does not buying feed wheat this time due to a lack of demand from local feed suppliers, the official said.

The ministry said last month it would conduct import tenders for wheat and barley for animal feed use about twice a month, instead of once every two months as previously due to rising volatility in the markets.

The SBS scheme allows greater flexibility than ordinary tenders, as users and trading firms can negotiate the grain's origin, price and quantity in advance before together placing a bid to the government.

Japan controls imports of key grains, such as wheat and barley, so as to stabilise prices.

In the previous tender held on Aug. 6, Japan bought 16,400 tonnes of feed wheat and 88,420 tonnes of feed barley.

That was short of the ministry's initial plan to buy 57,000 tonnes of wheat and 335,000 tonnes of barley.

However, traders say the shortfall was more likely due to increased frequency of bidding which gave buyers more flexibility to choose their time of purchase.