July 10, 2008

 

China's corn prices up on dwindling supply

Corn prices in China's major producing regions were higher in the week to Wednesday on dwindling local supplies.

 

Corn prices in Changchun city in Jilin, China's largest corn producing province, were quoted around RMB1,620 a tonne, up from RMB1,600/tonne a week earlier.

 

Corn prices in Zhaodong in another major producing Heilongjiang province were at 1,550/tonne, up RMB30/tonne.

 

Farmers were reluctant to sell corn on reduced stocks, and the trading was tight, according to Dragon Grain Network.

 

Rising new wheat prices and increasing input costs reinforced traders' expectations of a further increase in corn prices.

 

Corn prices in consumption areas were also mostly higher on reduced stocks.

 

Corn prices in Dalian port were between RMB1,690-RMB1,740/tonne, up RMB10/tonne from a week before.

 

The hike of domestic oil products' prices in late June will further add to costs, and the impact could be seen in a month, some analysts said.

 

The pickup in demand for feedmeal amid tightening supply will push corn prices higher ahead of the harvest in October, said Jilin Province Grain Administration in a note published on its Web site.

 

The government sold 116,898 tonnes of corn from its central reserves on Tuesday, or 31 percent of the 379,596 tonnes it planned to sell.