US regains top spot as corn export origin to North Asia for Q1 2021

New York — US corn has emerged as the key corn export origin for South Korean buyers for the first quarter of 2021 till now as per S&P Global Platts records, wrestling away the spot from the Black Sea exporters who dominated sales last year.

A reduced crop production in Ukraine this year due to poor weather has kept the prices of Black Sea origin corn high and thus uncompetitive against the other exporting nations.

Exports of corn from Ukraine during the 2020-21 marketing year so far are at 2.47 million mt, down 44% from the same period last year, according to data from Ukraine's agricultural ministry.

While historically Black Sea producers tend to be small players in the Asian import market, a bumper crop in Ukraine during 2019 catapulted Black Sea exporters to become the top exporting region to South Korean market for Q1 deliveries in 2020.

With less competition from the Black Sea or South America for shipment January and February, US exporters have secured a lion's share of the South Korean import demand. Based on Platts records, about 50% of the cargoes booked for Q1 delivery will be shipped from the US. This number could increase as some sellers have options to ship from worldwide origins.

Compared to last year, US sellers made up less than 10% of sales into South Korea.

KOREAN IMPORTS LOWER DUE TO HIGH PRICE

South Korean feedmillers have bought fewer cargoes for delivery in Q1 2021 compared to the same period in 2020 due to the current high corn prices.

Buyers paid around $200/mt CFR for cargoes in Q1 2020 whereas prices for corn for Q1 2021 have traded widely between mid $220s/mt to low $250s/mt CFR.

Currently corn prices are inverted and cargoes for April delivery are sold at as much $10/mt discount to March cargoes.

Buyers in Korea may be looking to ration their supplies in Q1 and buy more for Q2 to take advantage of the price discount, a market source said.