November 18, 2011
Thailand purchases 150,000 tonnes Australian wheat
This week, feed millers in Thailand bought 150,000 tonnes of Australian feed wheat for January-February delivery whereas Malaysian grain processors plan to buy a 60,000-tonne corn cargo for shipment early next year.
Taiwan has bought 55,000 tonnes of Brazilian-origin soy and Indonesia is looking to cover February shipment wheat from Australia, traders said.
"Feed manufacturers are very active, it makes sense to take feed wheat which is much cheaper than corn," said one Singapore-based trader.
"Thailand, Vietnam and South Korea are locking in supplies."
Australian feed wheat was traded into Thailand at US$265 a tonne, including cost and freight (C&F), compared with South American corn which was being offered close to US$320 a tonne.
Two South Korean feed makers purchased 55,000 tonnes each of feed wheat at US$259.89 per tonne cost and freight.
The first cargo is for shipment between December 28 and January 16 and the second cargo is for shipment between December 28 and January 24, they added.
Vietnam bought 60,000 tonnes of feed wheat last week between US$265 and US$270 a tonne, C&F for January delivery, traders said, adding that the country is expected to seek soymeal for January shipment in the coming weeks.
"They are covered for meal requirement up to December," said one soymeal trader. "They are now looking at January shipment and I think they will be interested in Indian meal because of it is quoted much lower than South American."
Indian meal is being offered into Southeast Asia US$375 to US$380 a tonne, C&F, compared with US$410 to US$415 quoted for Argentinean cargoes.
Even though feed wheat is being favoured by animal feed manufacturers, Malaysians are looking for one panamax vessel or 60,000 tonnes of South American corn for shipment in January or February.
South Korea's Major Feedmill Group bought 70,000 tonnes of US corn and two 55,000-tonne cargoes of optional-origin corn earlier this week for arrival from late February to early March.
MFG bought the US corn from Mitsui at about US$324 per tonne, C&F, and the optional-origin corn from Concordia at US$303.88 per tonne, C&F, traders said.
In the milling wheat market, most Southeast Asian buyers, including Malaysia, Thailand and Indonesia, have booked cargoes up to January.
"They still have time as buyers are done for January, now we expect them to be in market for February," said a trading manager with a Singapore-based commodities trading company. "Indonesia will be looking for at least 100,000 tonnes for February and it will be most likely Australian wheat."
The Taichung division of Taiwan's Breakfast Soybean Procurement Association (BSPA-T) has purchased 55,000 tonnes of Brazilian-origin soy in a tender which closed on Thursday (Nov 17), European traders said.
And Japan's farm ministry has issued a tender to buy 93,276 tonnes of milling wheat from the US, Canada and Australia.
Asian grain buyers will be closely watching the European debt crisis which has dragged down global markets, including the agricultural commodities.
US grains and oilseeds export sales reports due on Thursday will also provide price direction.