TOKYO. March 12. KAZINFORM Toyota Tsusho Corp. plans to import milling wheat from Kazakhstan to Japan for the first time to diversify its supply sources as food demand increases in Asia. The trading company affiliated with Toyota Motor Corp., Japan’s largest carmaker, is studying routes from Kazakhstan after a trial delivery of 3,600 metric tons of feed barley from the central Asian nation in October, said Shigemasa Miki, wheat and rice group leader at Toyota Tsusho. Japan, the world’s largest grain importer, buys almost 90 percent of its wheat overseas and sources almost all the supplies from the U.S., Canada and Australia under a state trading system. The government is considering deregulating imports as it moves to promote domestic output and cut costs after prices surged to a record last year on reduced global production. “After two straight years of drought in Australia caused a drop in exportable wheat and a rally in international prices, we think it’s necessary to find alternative suppliers to fulfill demand from Asian buyers,” Miki said in an interview in Tokyo yesterday. “We see Kazakhstan as an eligible exporter.” Kazakhstan wheat contains higher protein than crops in Russia and Ukraine and may meet the quality requirements of Japanese millers, Miki said. The country harvested 16.6 million tons last year, the fifth-largest exporter of the grain. Russia and Ukraine are forecast by the U.S. Department of Agriculture as the third and fifth-largest exporters, with Kazakhstan ranked sixth, this year. “Kazakhstan may be able to raise sales to Asian buyers such as Japan and South Korea when adverse weather cuts American or Australian supply,” said Nobuyuki Chino, president of Tokyo- based Unipac Grain Ltd. Siberian Railway Wheat for May delivery rose 0.3 percent to $5.095 a bushel on the Chicago Board of Trade at 9:39 a.m. in Tokyo. Prices have fallen 62 percent from a record $13.495 on Feb. 27, 2008. Toyota Tsusho is considering importing wheat from Kazakhstan on the Siberian railway and by ship from the Pacific port city of Vladivostok in Russia, Miki said. Another option is to ship the cargo through the Caspian Sea. “I don’t expect wheat shipments from Kazakhstan to Asia will expand rapidly as shipping costs are much lower from exporting countries such as the U.S. and Canada,” Chino said. It takes about two weeks to ship from the Pacific coast of North America to Japan, half the time from Kazakhstan, he said. Toyota Tsusho supplied 600,000 tons of milling wheat from the U.S., Canada and Australia to Japan last year through tenders held by the Ministry of Agriculture, Forestry and Fisheries. The company also sells the grain to Southeast Asian buyers. Wheat Imports Japan’s agriculture ministry imported 4.89 million tons of food wheat in the year ended March 31, 2008. About 60 percent was from the U.S., the world’s largest exporter, and 22 percent was from Canada, the second-biggest. Supplies from Australia represented 17 percent. The ministry is considering importing all milling wheat through the so-called simultaneous buy and sell system, which allows flour millers and trading companies to bid for supplies from any country. Purchases under the SBS system were 312,000 tons last fiscal year, or 6.4 percent of Japan’s total imports, Kazinform refers to Bloomberg.