WASHINGTON, D.C., U.S. — Earlier in May, the U.S. Grains Council (USGC) travelled to Vietnam to meet with key corn and distiller's dried grains with solubles (DDGS) customers in north and south Vietnam. Feed demand is steadily growing in the country, despite slowdown of the Vietnamese economy and feed milling companies increasing capacity. While imports of U.S. DDGS as of March are down year-over-year by 3%, they are expected to grow.
When an insect infestation was found in some shipments of U.S. DDGS at the Port of Hai Phong last year, the council was quick to respond and help get DDGS removed from the quarantine list. During this visit, the council visited Vietnam's Plant Protection Department (PPD) headquarters to get the latest update on its import requirements for DDGS and suggest measures to improve trade in the region. The council also expressed concern with the practice of surveying 100% of containers in a consignment (as opposed to random selection of 3%-7% of the consignment) at the Port of Hai Phong. By surveying 100% of the containers, local importers are faced with high demurrage and handling fees from the port, which results in higher prices of DDGS. PPD reassured USGC that appropriate checks and measures would be implemented to ensure they are in line with international standards.
The council also hosted a corn and DDGS outlook seminar for about 80 importers from southern Vietnam. The seminar led by Kevin Roepke, USGC manager of global trade, gave attendees an update on the U.S. and global corn market situation, U.S. DDGS market and exports and bulk and container transportation market updates. In addition, USGC held an introduction to risk management following requests from the audience.
The seminar highlighted the high quality of 2012 U.S. corn crop and DDGS, the advantages of the U.S. supply chain, its reliability and consistency. While U.S. corn is still not competitively priced for delivery to Vietnam, U.S. DDGS have proven to be a competitively priced feed ingredient. After the council's seminar, several importers expressed their intent in booking new shipments for July and August deliveries.