October 27, 2004

 

 

Philippines May Buy Bulk of 2005 Wheat Imports From Ukraine

 

The Philippines is likely to source the bulk of its wheat import requirements next year from Ukraine, as wheat prices from traditional suppliers are much higher, a feedmilling industry official said Tuesday.

 

"If it maintains its present price level, then Ukraine can be a major competitor for wheat in the Philippines," Ric Pinca, vice president of the Philippine Association of Feed Millers Inc., stated.

 

This year, the Philippines imported around 17% or 100,000 metric tons of its year-to-date wheat imports from Ukraine.

 

Total imports so far have reached 567,000 tons, only half of the country's wheat imports of around 1 million tons in the previous year, Pinca said. The lower volume of imports has been attributed to high prices of wheat in the world market.

 

According to Pinca, local feedmillers have bought Ukrainian wheat at a price range of $130-$148 a ton, C&F basis, lower than wheat prices in India and China, two major sources of the country's feed import requirements in recent years.

 

At the current price level of Ukrainian wheat, the landed cost of about 9.60 pesos ($1=PHP56.25) a kilogram will be a little higher than prevailing local corn prices of PHP8.50-PHP8.80/kg, Pinca said.

 

"But the local corn situation is uncertain. We don't know whether there's enough corn to buy," he said.

 

Wheat is a corn substitute for the manufacture of animal feeds.

 

Pinca said imported wheat will continue to be a major raw material for feeds in the Philippines or corn prices will be at high levels.

 

In fact, softer prices of local corn beginning in August this year were brought about in part by wheat imports, he said. Local corn prices reached a high of PHP12/kg in June due to limited supply and high world market prices of corn and wheat.

 

"The availability of wheat has depressed the demand for local corn, so there was pressure on local corn prices," he added.