June 6, 2011

USDA to deliver corn to China by September

The USDA acknowledged on May 26 that China had purchased 116,000 tonnes of corn from the US in the early spring of 2011, which it will deliver by August 31.

It is believed that China will purchase more quantities of corn before that, given the current low prices of US corn.

Based upon the large amount of trade volume, market traders reckoned that China purchased corn from international market in early May in 2011, when the price had dropped to the lowest point during the recent six months. If drought remains in China, and market price of corn goes on slipping in the US, China will purchase more corn from the international market.

It was the first time that the USDA affirmed China's purchase in 2011. In order to make up the coming insufficient supply of corn, caused by the rainy weather, prices of corn in the CBOT market was rising to the point in early spring on May 26.