(Posted Wed. Aug 24th, 2016)
Following a five-year hiatus from Malaysian shores, the U.S. Grains Council (USGC), of which the National Corn Growers Association (NCGA) is a founding member, was recently on hand to welcome back the first vessel of corn from the United States since the historic drought in 2012/2013. The vessel, which was loaded from the Pacific Northwest, was sold from one USGC member to another, destined for a consortium of several key USGC allies.
“This is an exciting opportunity,” said Kevin Roepke, USGC South and Southeast Asia regional director. “We're able to build partnerships that help this bit of trade happen, which is a big win for Malaysia and U.S. producers.”
The geared handimax, the Yasa Gulten, berthed over the weekend in Port Kelang after initially unloading in Southern Malaysia’s Pasir Gudang, immediately across from Singapore. It will ultimately venture east to Vietnam.
The vessel was seen by the industry as a “trial run” to retest U.S. quality following significant engagement from the Council to encourage readoption of U.S. grains. In particular, USGC's quality reports issued each year to offer in-depth information to customers about the current year’s crop helped alleviate objections and some nervousness about U.S. corn quality.
According to operations employees, the recently-arrived vessel came in around 1 percent higher in moisture and with similar rates of broken corn as South American origin corn. High moisture has always been a concern for U.S. origin corn in Southeast Asia because hot and humid weather conditions make even short-term storage challenging. The cargo was reportedly loaded at roughly 13.7 percent and arrived at approximately 14.7 percent, close to the threshold of 15 percent.
The Council will continue to work with Malaysian buyers to help answer additional questions as they use the corn and, in time, pave the way for future sales.
“Buyers want the best quality and we work hard to answer their questions and help them have confidence in buying from the United States,” Roepke said.
Should the market deem the quality comparable to South American-origin corn, it should signal a turning point for the Malaysian corn market, with the South American crop under pressure this year and the United States expecting an abundant harvest.
Particularly if U.S. corn comes in at the high-quality expected, the U.S. could be receiving more and more business from Malaysia and Southeast Asia in general.
More about work to increase U.S. corn imports in Malaysia and other countries in the region can be found here.