Japan Cutting Corn Imports on Higher Prices

The Japanese continue to keep its corn imports at its lowest levels in 26 years, as high corn prices has resulted in feed producers boosting acquisitions of alternative feeds.

According to Mitsuyoshi Haruno, executive director at the Japan Feed Trade Association, he told Bloomberg that Japan will increase "consumption of wheat, wheat bran and dried distillers’ grains with solubles, or DDGS."

Haruno added that corn imports will be close to the 15.3 million metric tons of 2011.

The Japanese finance ministry said feed wheat imports have surged this year from 62,415 tons last year in the same season to 334,349 tons this year. Of that, the U.S. supplied 198,699 tons, equal to 59 percent of the overall Japanese imports. Australia was the next largest feed wheat exporter to Japan, accounting for 127,807 tons.

Feed wheat imports for Japan this year were set at 764,000 tons, but that could be upwardly revised for the fiscal year.

So far for the year Japan has imported 4.36 million tons of grain for feed, down 3.1 percent from the same period last year. But for corn for all purposes, Japan has imported 6.51 million ton in the first five months of the year ended May 31, or an increase of 0.8 percent over last year.

During the same period the U.S. accounted for 85 percent of Japanese corn imports, which could drop to 80 percent for the year as Japan looks for less expensive options.

Corn Futures Fall on Japan Concerns

Corn futures dropped on concerns Japan would cut U.S. corn purchases.

Light, sweet crude for April delivery fell as low as $99.01 a barrel early in the session Friday before recovering to settle down $1.54, or 1.5%, at $101.16 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures fell $1.59, or 1.4%, to settle at $113.84 a barrel.

Corn and lean hog futures saw some of the sharpest declines on fears the disaster would slow demand from a key buyer. Further selling came from traders looking to just exit commodities markets because of the overall uncertainty that follows a natural disaster.

"The immediate impact of the earthquake was extreme uncertainty—the condition most hated by investors," said Bryce Knorr, analyst for Farm Futures, an agricultural publication.




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