Ample corn supplies push prices down

Ample corn supplies push prices down

KUALA LUMPUR (Reuter): Abundant supplies of imported corn in Thailand and Malaysia have pushed domestic prices lower and they will probably ease further into next week, traders said yesterday.

But Indonesian corn prices climbed on the back of a poor harvest in the key growing region of Lampung in South Sumatra, Jakarta grain traders said.

Corn bulk prices in Malaysia fell an average 10 ringgit to between 570 and 580 ringgit ex-factory/godown in the central region this week, industry sources said.

"Traders have been trying to test the 590 ringgit level, but I don't think the market will rise to that in the near-term," a flour mill official in Kuala Lumpur said.

"The current corn price is a bit too high and nobody is in a rush to buy, so the market will remain a bit sluggish," he added.

Most consumers were well-covered on corn and some had just taken delivery of earlier purchases bought at 490 and 500 ringgit a ton. Traders said prices could dip further if pressure for storage space in warehouses mounted.

Thai domestic maize prices paid by feed producers fell this week to an average 327 baht/60 kg, compared with 330 baht/kg last week, on high supplies, especially after the arrival of two shipments of corn from the United States, traders said.

"Feedmills don't want to buy. They have a lot of stocks after the imports," one Thai trader said.

Two shipments of 130,000 tons of U.S. corn arrived earlier this month and a third shipment of 30,000 tons of Argentinian corn was due to arrive by the end of June, the traders said.

Maize prices were expected to continue easing this month because of the imports and in the run-up to the harvest of the new crop next month.

"I think we'll be looking at around 305 (baht/60 kg) next week," the trader said. "Next month, we'll have a lot of supplies."

In Indonesia, corn was quoted at Rp 620-630/kg in Jakarta, compared with Rp 600 last week. One trader said he estimated the Lampung crop to be some 15 percent smaller than the average 300,000 tons.

Soymeal prices in Thailand also fell on weak local demand and the presence of abundant supplies to an average of 9.55 baht/kg against 9.60 baht/kg last week.

"There are a lot of supplies around at the moment and demand is weak, but I think we'll see prices stabilize at the around this level," a Thai trader said.

Animal livestock associations have been importing cheap Indian soymeal in recent weeks, putting pressure on prices, traders said.

In Malaysia, imported soymeal in bags fetched around 770 ringgit while the local material in bags was around 785 ringgit per metric ton ex factory/godown central region.

"A" grade wheat in bags were priced at around 970 ringgit while low grade wheat in bags at around 650-700 ringgit per metric ton ex factory/godown central region, industry sources said.

United Malayan Flour Mills and Seberang Flour Mill in the northern Penang state were expecting a delivery 11,000 tons of wheat each from the Australian Wheat Board in the first week of July, officials said.

The consignment was being brought in at $270 per metric ton FOB and $290 C and F, officials said.

In Jakarta, soymeal rose to around Rp 800 from Rp 77-780 on good demand.