August 20, 2008
South Korean feedmakers are gearing up for active grain buying to make up for a subdued trading during the past few months when prices were high.
South Korea, the world's third-largest corn importer, last week ended months of staying on the sidelines by purchasing its first overseas corn and soymeal for months.
Last week, two South Korean feedmill groups -- Major Feedmill Group (MFG) and the Korea Feed Association's (KFA) regional members in Busan -- purchased a total of 100,000 tonnes of US corn at prices of about US$326 per tonne including cost and freight.
In a separate deal, MFG agreed last week to purchase 55,000 tonnes of South American soymeal US$450 per tonne or optional Indian soymeal at US$440 per tonne from Cargill in a private negotiation, traders said.
Meanwhile, KFA is considering buying up to 110,000 tonnes of US corn after passing on a tender last week.
A private deal on Monday also saw purchase of 45,000 tonnes of soymeal at US$460 per tonne with origin options of South America or India.
Korean feedmakers have stayed away from corn and soymeal purchases this summer in favour of cheaper alternatives like wheat. It has also tried to diversify its grain sources away from the US to other countries like Indonesia.
However, corn prices, which have fallen 30 percent from their record highs in late June, have brought Korean buyers back into the market.