China's corn prices stable to higher on limited supplies

Corn prices in China's major producing areas were stable to higher in the week to Wednesday (May 12) as tight supply conditions still dominated the market.

Limited local supply was still keeping an upward pressure on prices, trimmed somewhat by the expectation of imminent corn imports from the US. "There are estimates of lower supply because of recent snow and rain in the northeast, and that's supporting prices," said Xu Wenjie, an analyst with Tianma Futures Co.

Government sales from corn stockpiles have seen healthy buying, with all offered volumes sold so far, amid recovering demand in the feedmeal and industrial processing sectors.

China purchased two cargoes of corn totalling around 100,000 tonnes from the US last month, traders said.

More corn imports may be on the way, Xu said, citing market speculation on purchased cargoes in the US that did not specify a destination but which participants widely suspect are bound for China. Analysts expect corn prices to rise further in the near term as the current crop is dwindling.