Dominance of U.S. corn in Asia shaken by drought, price

Wed Oct 24, 2012 8:57pm GMT

* US prices are high as drought devastates crops

* Asian buyers of US corn forge ties with competitors

* Prices would be key in keeping US dominance in exports

* Brazil, Argentina grab US market share

By Karl Plume

MINNEAPOLIS, Oct 24 (Reuters) - The worst drought in half a century has led long-time importers of U.S. corn to forge ties with alternative suppliers, casting a shadow over the United States' continued dominance in the export markets, said foreign grain buyers at a conference here.

Major importers in Asia, including South Korea, Taiwan and top buyer Japan, have turned away from the United States as U.S. corn prices soared to record highs this summer, buying feed from South America and producers in the Black Sea region.

China has not bought any U.S. corn since mid-summer and may not make additional purchases before the spring of 2013, and even then only if prices drop to more competitive levels closer to $6 per bushel, said the grain buyers who attended the Export Exchange industry conference on Wednesday.

Corn futures at the Chicago Board of Trade closed at $7.54-1/2 a bushel on Wednesday, off the record high $8.43-3/4 set on Aug. 10 at the height of the drought rally.   Continued...

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