Poor weather in the U.S. hampered exports, forcing Japanese feed makers to drain 340,000 tonnes from the country’s stockpile
TOKYO, Japan (Reuters) — Japan, the world’s top corn importer, has tapped at least 340,000 tonnes of the grain from emergency stockpiles after inventories fell to critically low levels because of a delay in shipments from the United States.
An official at the agriculture ministry said last week that it had received and approved applications from 11 feed makers by the end of February for the use of 340,000 tonnes of grain — including a small volume of wheat — from the 850,000 tonnes held in emergency stockpiles.
Blizzards, avalanches and heavy rain in the northwestern United States early this year have hurt the transportation of corn, soy and wheat to ports, causing lengthy delays to grain loadings in Japan’s main corn supplier.
Seventeen Japanese feed makers are required to hold the stocks of feed grains, mainly corn, and need to seek approval from the government to use it in an emergency.
The volume of 850,000 tonnes is equivalent to about a month of domestic demand, according to Takanari Ishibashi, deputy director of agriculture ministry’s feed department.
“Some mills are better stocked than others,” said Ishibashi.
“Some may need to be doing a balancing act in early March, but we think they all can get through as there are enough remaining emergency stockpiles and more shipments are expected this month.”
Most of the feed makers that tapped the stockpiles plan to refill inventories by around March 20. Others expect to do so by early April, he said.
The 340,000 tonne amount is the biggest monthly volume sought for use of emergency stockpiles of grains since the government adopted a new stockpiles system last April, Ishibashi said.
However, Japan tapped more than 750,000 tonnes of emergency stockpiles in 2011, when a massive earthquake and tsunami in northern Japan disrupted supply chains and caused the worst nuclear crisis since Chernobyl in 1986.
Amid the shortages, Japanese trading houses are scrambling to find immediate supplies from other countries, including China.
China’s COFCO Corp. is in talks to sell a small cargo of corn to Japanese trading house Mitsubishi Corp, two sources said last month, a rare foreign sale of grain from the world’s second largest producer.
The U.S. Department of Agriculture expects Japan to import 15 million tonnes in 2016-17.