East Asian importers will slow grain purchases this week in anticipation of further falls in prices and freight rates, regional traders said on Monday.
The importers would not hurry to buy shipments for the last quarter of the year, since they stocked up a few months ago when prices were high and looked like going higher, the traders said.
Only South Korea's Agricultural and Fishery Marketing Corporation (AFMC) was expected to issue a tender this week, to buy 25,000 tonnes of soyabeans for August shipment.
"The great majority of buyers have already fulfilled their requirements until September and activity is not expected to pick up until July for purchase for the October-December period," a Tokyo grains trader said.
"Many buyers have been badly affected by recent steep falls in freight costs and rapid falls in futures prices on CBOT, since they bought both soyabeans and corns at high prices."
Asian traders said the benchmark Panama dry bulk rates of the US Gulf to Japan routes dropped to around $50 per tonne, down more than $20 from about a month ago. The rates hit record highs of above US $80 this year.
Prices have tended to fall because of healthy forecasts for crop conditions, Tokyo traders said.
"Buyers are not eager to increase their forward positions as they did in late March and April. In the current weak price outlook, there is no reason to start buying quickly," a corn buyer in Tokyo said.
Korean feed makers, who increased US corn imports in response to tight Chinese supply this year, will probably buy more US corn later this year, thanks to the softer freight rates and lower US prices.
"Prices of US grains have fallen to the levels similar to those of corn from Southeast Asia," a senior trader at a major feed maker in Seoul said, referring corn offers at slightly over $160 per tonne C&F for third-quarter shipments.
By comparison, US corn for June shipments was offered at almost $190 per tonne C&F in early March. "We are expecting more price falls as the harvest season gets closer. Imports of US grains are projected to rise rapidly," he said.
Of South Korea's January-April feed-corn imports of 2.2 million tonnes, US supplies accounted for more than 1.1 million tonnes, surging from 58,367 tonnes a year, industry data showed.
Without much Chinese supply, South Korean feed millers imported about 250,000 tonnes of south-east Asian corn in the period.
Taiwan buying of grains and oilseeds will probably be quiet again this week as the summer slack season for feed demand weighs and as high stocks keep buyers sidelined, prompting some to consider delaying shipments for July.
The Great Wall Feed Group delayed its June shipment by 15 days and says it is also considering pushing back delivery for its July shipment if demand stays weak and international prices for corn, which hit three-month lows last week, continue to fall.
Traders said corn and soyabean for use in animal feed had been overbought in the year.
Domestic corn prices have fallen by around 10 percent in the past month as the onset of summer's warmer weather and the outbreak of bird flu earlier this year has cut into meat consumption and consequently the demand for feed.
An official with Taiwan's wheat buying association said lower freight rates could affect their buying intentions as freight rates fell on slowing China demand for raw materials.
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