November 29, 2007

 

China corn prices escalate anew

 

 

China's corn prices continue its ascent this week as farmers hold their produce in anticipation of higher prices.

 

The rising planting costs and high corn prices last harvest season raised the farmers' projections for corn.

 

In Changsha city, corn prices were around US$256.77 a metric tonne, up from US$247.31 to US$250 per tonne from last week.

 

Corn prices in Ningbo city were between US$254.07 to US$259.47 per tonne, up from US$240.55 to US$241.90 a week ago.

 

Jinhua Grain Wholesale Market said farmers are waiting for higher corn prices as soy and soy products have risen sharply these past weeks.

 

China's industrial processing plants are left with no option but to increase offer prices to the highest they can withstand due to dwindling stocks.

 

However, the escalating prices capped the demand for corn.

 

Currently, three large-scale starch producers stopped production while others are seeking to relieve insufficient supply and rising cost through production cutbacks.

 

Corn prices are expected to rise further next week, plagued with high transportation fees and overall inflation.

 

At the Dalian corn futures market on Friday, the mainstream contract corn 0805 opened at US$239.47 and closed at US$242.58, with daily transaction reaching 1.04 million lots.