China corn prices rise slightly on limited northern supplies

 

 

Corn prices in China's major producing areas rose slightly in the week to Wednesday (June 17), with supply in northern areas tightening as most stocks remain in government reserves.

 

Corn prices in Jilin province were around RMB1,520 a tonne, up from RMB1,470-RMB1,490/tonne a week ago.

 

Corn prices in Heilongjiang province were RMB1,580/tonne, up about RMB10 from a week ago.

 

Corn prices in Shandong province were RMB1,600-RMB1,660/tonne, slightly higher than a week ago but up about RMB40 from two weeks ago.

 

Government sales of stockpiled crop, as expected by the market, haven't happened yet, said Wang Cheng of Nanhua Futures.

 

However, Wang added, market participants believe the government is mulling a RMB100/tonne subsidy for eventual corn sales to processing plants, in addition to a RMB1,550/tonne sale price.

 

The speculation put some pressure on corn cash prices in some producing areas last week, Wang said.

 

But prices have since recovered on the calculation that including processing and transport fees, the final price would be slightly in excess of RMB1,600/tonne, around the same level as corn futures on the Dalian Commodity Exchange. Dalian's benchmark January corn contract stood at RMB1,617/tonne as of Tuesday's settlement.

 

 

Overseas demand is still unstable, despite signs of growth in May. Corn exports in the January-May period were down 74 percent on year at 28,313 tonnes.