NOFI buys more corn as Korea looks to wrap up October imports

South Korea’s feed sector has capitalised on last week’s huge falls in corn prices in a spate of fresh buying, led by the country’s biggest manufacturer returning to secure more corn via tender.

Glencore was said to have sold to NOFI at $189.82/mt for 69,000 mt, with the cargo to arrive by October 25, according to market sources.

The move comes on the back of NOFI picking up 140,000 mt of corn on Friday and MFG buying privately from Cargill, before a bearish data release saw corn prices shed close to $0.20/bu.

Market sources anticipate a burst of private buying following this tender, with the country poised to wrap up its October import needs perhaps by the middle of the week, as Monday’s tender took buying to 398,000 mt in a matter of days.

Two additional deals were said to have followed the Friday NOFI tender, with negotiations continuing long into the night as corn prices collapsed after the USDA revealed a big switch towards corn in its planting update and the third largest corn stock levels ever.

FLC and KFA picked up cargoes privately, according to market sources, with FLC buying from Cofco at $191.49/mt for October 20 arrival, and KFA buying 65,000 mt corn for delivery into Incheon at $188.50/mt for October 30 arrival.

“All buyers will cover the balance of their October arrival feed corn within the next three days,” one market source told Agricensus on Monday.

South Korea needs to import around 10.2 million mt of corn according to the USDA’s 2018/19 estimate – with feed corn accounting for around 8 million mt.

Major price falls through February and March drove the country’s four main manufacturers – NOFI, MFG, KFA, and FLC – to pick up 2.4 million mt in six weeks, through a combination of tenders and private deals.

Corn processing association KOCOPIA also picked up a further 130,000 mt at tender, taking the buying to a quarter of the country’s total import needs in a concentrated buying burst.

“This price fall will definitely attract other buying groups to consider buying and fix cheaper corn... to fill up October arrival,” a second market source said.

“Since the speed of corn purchasing is already faster than normal years, I don’t see that they will buy as they did in February and early March,” the source warned.

For more information on South Korea’s corn tenders, see our Tender Dashboard.