April 26, 2007

China corn prices up; farmers not selling amid tight supply

China's corn prices in major producing regions were slightly higher in the week ended Wednesday (Apr 25), with farmers reluctant to sell stocks on hopes of further rises and analysts saying cash prices have hit bottom.

In Jilin, China's largest corn-producing province, prices of average-quality corn were quoted at RMB1,070-1,160 a tonne, slightly higher than RMB1,050-1,150 a week earlier.

Prices in Heilongjiang province, another major corn-producing region in the northeast, were at RMB1,020-1,040/tonne, compared with RMB980-1,020/tonne the previous week.

Average prices in Shandong province were at RMB1,530-1,580/tonne, largely unchanged from RMB1,540-1,580/tonne a week ago.

With the start of the planting season, farmers are too busy to sell corn and are taking advantage of the dry weather to preserve stocks, said Shen Wei, an analyst at Cofco Maize Company in Beijing.

Stocks are not sufficient and demand is likely to pick up only after the week-long Labour Day holiday in early May, he added.

Corn prices were lower after the Lunar New Year holiday in February due to sufficient supply and sluggish demand.