South Korean corn buyers returned to the market following holidays in the week started Oct. 9, buying up first-half February delivery positions, including from the Black Sea at discounted levels because of quality concerns, traders said.
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Register NowThe buyers snapped up a total of six cargos over Oct. 10-11, with half of them to be shipped out of Romanian or Bulgarian ports of Constanta, Varna or Burgas. The purchases came ahead of the October release of World Agricultural Supply and Demand Estimates from the US Department of Agriculture on Oct. 12.
The buyers also bought South American or South African corn for similar delivery periods at a premium, traders said.
South Korean buyers were initially hesitant to purchase Eastern European corn despite discounts by suppliers after encountering some issues with the level of vomitoxins, broken corn and foreign matter in the previous batch for June delivery. But they gave in to the discounts in the current round of purchases, while spreading out quality risks by paying a premium for South American corn.
"So, Korea will pay up $3.50-$4/mt for South American corn," said a trader. Another trader said that it made sense for them to buy South American corn as well, despite wider availability of Eastern European offers in the market.
Nonghyup Feed Inc. started buying Oct. 10 through a tender and booked two cargos from Olam. The first corn cargo of Eastern European origin was sold at 137 cents/bu over March (H) futures, or at $252.25/mt CFR based on settled futures, while the second cargo of South American or South African origin was sold at $264.15/mt CFR, according to traders.
Major Feedmill Group on Oct. 11 purchased corn via a tender and subsequent private deal. In the tender, South American corn was sold by Sierentz at $255.90/mt CFR, while corn of worldwide origin, including Eastern Europe, was sold by Pan Ocean at $252.30/mt CFR. Viterra sold the third cargo of worldwide origin at $251.30/mt CFR in a late private deal.
Some deals that included Eastern European origin were sold without a guarantee for vomitoxin levels.
KFA Busan only sought South American corn in a tender Oct. 11 and bought a cargo from ADM at $257.85/mt CFR Busan.
Platts, part of S&P Global Commodity Insights, assessed corn CFR Northeast Asia at $253.25/mt on Oct. 11, up $1/mt on the day.