Asia Grain, Indian corn Market Outlook
* Indian corn prices drop $15/T to $275 on supplies
* Buyers remain on sidelines, expect further decline
* Australia's wheat prices rise on dry weather
* Indonesia eyes corn shipments for June arrival
By Pankaj Katba Feed Grain Agri brokers
Indian corn prices eased this week due to stiff competition from South American suppliers in Asia, while buyers largely stayed on the sidelines as world grain markets slid on concerns over slowing global growth.
Traders, though, said Indonesian feed millers are likely to seek about 150,000 tonnes of corn for June shipment.
"Indonesians haven't covered anything much for June shipment," said one trader with an international grains trading company in Singapore. "We expect them to cover some supplies but no one is in any hurry as prices are coming down."
Malaysia, which largely buys South American corn, will be looking to cover around 120,000 tonnes for June arrival, while the Philippines has yet to source about 50,000 tonnes of feed wheat for July shipment, traders said.
U.S. corn futures have lost 2 percent this week as the market gave up some of last week's strong gains in sympathy with a broad-based selloff incommodity markets. Wheat has fallen about 2 percent this week, losing ground after two consecutive weeks of gains.
As a result, Indian and Argentine corn prices fell in Asia.
Indian corn is being offered around $275 a tonne, including cost and freight (C&F), in Indonesia, down from $290 quoted last week. Argentine corn has slid to $285 a tonne from $295 a tonne offered earlier this month.
In the wheat market, there was some demand for Indian wheat this week after a lull, with buyers quoting above $300 a tonne.
India's State Trading Corp has received the highest bid at $304 per tonne from a global trader in its latest wheat export tender.
But traders said the demand for Indian wheat was mainly driven by buyers covering shorts.
"I don't think anyone will buy Indian wheat today at a price above $300 a tonne for new sales," said another grains trader. "Once traders have covered shorts the demand will decline as Black Sea is offering wheat at much cheaper prices."
International trading companies have been sourcing new-crop wheat directly from the local market in western Rajasthan and Gujarat states for shipment through Kandla port, dealers said.
Black Sea-origin wheat with 11.5 percent protein content was offered around $260 a tonne, C&F, for August shipment and feed quality wheat at $245 a tonne.
DRYNESS IN AUSTRALIA
Still, wheat prices rose in Australia this week, supported by dryness which is threatening to curb supplies.
A lack of soil moisture in Australia's eastern grain belt is forcing farmers to plant grain in dry soil in New South Wales and Victoria, parts of which have seen little rainfall over the past months.
As a result, the price of new-crop prime wheat for January shipment rose $15 a tonne to around $320 a tonne, free on board, this week.
Old-crop Australian prime wheat was quoted at $318-$320 a tonne, FOB, while standard wheat was being offered close to $312-$315 a tonne.
The wheat market could rise next week as adverse weather is damaging the U.S. winter crop, traders said.
Another round of freezing temperatures in the U.S. Plains at midweek probably harmed more of the winter wheat crop, while heavy rainfall in the Midwest again helped ease drought stress but also stalled corn plantings.
Best regards
Pankaj katba Email: Pankaj@feedgrainagri.com
