October 2, 2012

 

 

For the first time, France will export corn to South Korea which is also its largest-ever corn shipment to any country.

 

According to shipping and trade sources, importers are varying sourcing in response to a drought-hit US harvest.

 

The vessel Christina IV is due to call at the Atlantic port of La Pallice this week to load 55,000 tonnes of corn for South Korea, port data showed on Monday (Oct 1). The exporter is international grain trader Bunge. The South Korean buyer was not disclosed.

 

"It's a first both in terms of the volume and the destination," one grain trade source said, adding he saw potential for another French corn cargo for South Korea next month, depending on market conditions.

 

South Korea is one of the world's largest importers of corn, a staple ingredient for livestock feed, and usually imports from the US or South America.

 

Like in other import-dependent countries, buyers in South Korea have been grappling with record prices in the US, the world's largest corn grower and exporter, as the worst drought in half a century has ravaged US crops.

 

Importers have been seeking alternative origins and the French cargo shows this sourcing has extended to the EU, a minor corn exporter whose shipments rarely extend beyond the Mediterranean region.

 

Corn futures in Chicago hit an all-time high of US$8.49 a bushel on August 10 and regularly traded above a previous record level of US$8 into early September, when grain markets saw a sharp pullback that lasted until a dramatic rebound on Friday (Sep 28). Last week, traders reported a massive 834,000 tonnes of corn had been snapped up by Korean buyers taking advantage the September pullback in prices.

 

France is the EU's top corn grower but ships most of its surplus to other EU countries rather than onto the world market.

 

The scheduled cargo for South Korea was the first of French grain corn to the Asian country, according to French customs records, and traders said it was largest single loading of French corn ever seen.

 

However, traders do not expect this to become a major trend this season as a drought-affected EU harvest should leave the 27-country bloc with little scope to export. Last season, the EU exported about three million tonnes of corn following a bumper crop in 2011.