August 7, 2008
 

China corn prices down on weak demand, continued state sales

Corn prices in China's major producing areas were lower in the week to Wednesday (August 6) on low demand and continued state sales.

The recent tumble in corn futures prices at Dalian Commodity Exchange also helped to pressure the cash prices.

Corn prices in Yushu area in Jilin, a major producing province, were between RMB1,620-CNY1,650 a tonne, down RMB10 from a week before.

Corn prices in Qingdao in Shandong province were at RMB1,800/tonne, down RMB20.

Analysts said feedmeal demand in Shandong was weak and the feedmeal plants lowered their bids for the corn.

Traders were willing to sell their corn while feedmeal plants stayed on sidelines, Jilin Corn Centre Wholesale Market said in a note published on its Web site.

Tighter controls to ease air pollution and clear the air around Beijing during the Olympics is also curbing demand from industries that use corn to make products such as ethanol and starch, said analysts.

Tuesday, the government sold 240,845 tonnes of corn, or 69 percent of the 349,407 tonnes it planned to sell from its reserves. The corn was sold at an average price of RMB1,547/tonne, lower than RMB1,586/tonne last week.

Corn prices in Chinese ports were also lower, with prices at Guangdong port at RMB1,840-CNY1,910/tonne, down RMB10 from a week ago.

The China National Grain and Oils Information Centre, a government think-tank, on Wednesday hiked its 2008 corn output estimate by 2 million tonnes to 156 million tonnes.