28 Apr 2021

High prices nibble at corn’s sway as Asian feed buyers switch to wheat

SINGAPORE, April 27 (Reuters)- Asian feed manufacturers are switching to wheat in animal rations as multi-year high corn prices constrict demand for the yellow grain widely used to fatten hogs and chickens. Some of the world’s top corn buyers such as China, South Korea, and Vietnam are buying more wheat from Australia and the Black Sea region in the months ahead as the landed cost of corn has climbed to a rare premium to wheat, said two Singapore-based grains traders.

Combined, those three countries are forecast to buy 26.4% of global corn imports this year, according to the U.S. Department of Agriculture, so any substitution for wheat could have a large impact on global grain trade flows.

 

“It is more attractive to use wheat, we have seen demand for Australian wheat coming from feed makers although our crop quality is pretty good and there is not much lower quality wheat which can be termed as feed wheat,” said Ole Houe, a director at brokerage IKON Commodities in Sydney.

“But even milling wheat (from the Black Sea region) is cheaper than corn, so the switch is happening.”



 
 


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