June 14, 2006

 

China's corn prices mostly stable, feed demand recovering

 

 

China's corn prices were mostly stable in the week to Wednesday (Jun 14), although prices rose slightly in some areas on a recovery in feed demand.

 

In Jilin, China's largest corn-producing province, prices of average quality corn were around RMB1,220-RMB1,270 a tonne, little changed from the previous week.

 

Prices in Heilongjiang province, another major producing area in the north-east, were also little changed around RMB1,190-RMB1,220/tonne.

 

"Farmers in the north-eastern producing regions now only have 10 percent-20 percent (of their total stocks) left," said Wang Shiliang, an analyst with Jilin Grains Centre.

 

This has prompted more buying from processors, who fear a lack of supply in the future, he said.

 

Meanwhile, prices in Guangdong province, a major consumer in the south, were RMB10 higher at RMB1,450/tonne, underpinned by slowly rising feed demand, analysts said.

 

The Hong Kong government Tuesday said a man suspected of having bird flu was in critical condition in Shenzhen, Guangdong province.

 

"Individual cases would not have much impact on the general market atmosphere... as long as there are no more such reports," said a trader in Jilin province.

 

In April, industry players had talked about the possibility of the government releasing corn export quota, but "it has become less likely, given the high prices," said Wang.

 

"I see no reason for prices to drop much in the near future," he added.