Importers in Japan will be busy this week seeking corn and soyabean cargoes ahead of the summer holiday period, while traders in Taiwan will be buying after running down high domestic stocks, traders said on Monday.
Japanese corn buyers, who have just started to look for October-December cargoes, are expected to step up purchases this week ahead of the mid-August Japanese "boon" summer holidays, industry officials said.
One trader said US corn c&f premiums for October-December shipments had been offered to Japanese buyers at 162-163 cents per bushel, down sharply from 172-173 cents for July-September, reflecting falls in Panama freight rates.
He said Japanese feed makers were striving for more cuts in US corn premiums, aiming for a level below 160 cents. A second trader said Japanese buyers had been slow to begin purchases for October, due to a bearish shipping market.
He said, however, there was signs that the market may have hit bottom, and was steadying. Panama rates for the benchmark US Gulf to Japan route were estimated at $35 per tonne, up from $30-$31 around the middle of last week.
He added, however, that it was say whether this was a brief respite, or whether it signalled the start of a real recovery in freight rates. "It's not quite clear if the market has actually hit bottom," he said.
Japan's Agriculture Ministry said last week that it had discovered a seventh US feed grain cargo tainted with Bt-10, a genetically modified (GMO) corn strain made by Swiss agrochemical group Syngenta AG.
The biotech corn has not been approved for distribution, and Japanese importers must either destroy or ship any cargo found with Bt-10 back to the United States. Traders said the issue was no longer slowing the market as some cargoes were being checked before loading, decreasing the chances of a tainted cargo arriving in Japan.
In the oilseed market, Japanese soyabean buyers were believed to be looking for September cargoes. In Taiwan, grain and oilseed importers will be busy over the next two weeks seeking September shipments of corn and soyabeans, traders said.
"Domestic prices have already rebounded with few arrivals due in the next two weeks, and stocks are likely to cover demand only until around the end of September," an international manager at Great Wall Feed Group said by phone.
Great Wall and rival Members Feed Industry Group are expected to seek corn for shipment in the second half of September, the official said.
Taiwan imported 2.14 million tonnes of corn in the first five months of the year, down 5.7 percent over the same period in 2004, the latest government customs data showed, with the United States supplying over 90 percent.
The Kaohsiung division of the Breakfast Soyabean Procurement Association is also meeting later on Monday to decide the timing for a 60,000 tonne tender that is likely to include beans from the United States and South America, a group official said.
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