China corn prices rise as spring consumption reduces supply

 

 

Corn prices in major producing regions of China rose in the week to Wednesday (March 25), as supply tightened with a seasonal hike in consumption.

 

"After March, corn prices usually increase as old stocks are depleted with the onset of warmer weather," said Knag Zhichao of Nashua Futures.

 

In the Harbin area of Heliographing province, a major production base in the northeast, corn prices were around RMB1,180 a tonne, RMB20/tonne higher than a week earlier.

 

Prices in Chang in Jilting province, another producing region in the northeast, were up around RMB10/tonne at RMB1,520/tonne compared to a week ago.

 

Corn prices at Guangdong port were around RMB1,710 up about RMB40/tonne from a week ago.

 

Buyers are competing for dwindling physical stocks, which have also been pinched by government stockpiling.

 

The government is reserving 40 million tonnes of corn to protect farmers' incomes and weather severe fluctuations in prices.

 

Most of its purchases have been completed, analysts said.

 

 

China's February corn imports rose 92 percent on year to 279 tonnes, while exports fell 91 percent on year in the same month.

 

Amid tightening supply, industrial processing plants in Jilting province are trying to buy more corn to process, and feed meal companies are moving to replenish stocks.

 

The combination of factors is expected to push corn prices higher in coming weeks, analysts said.