October 10, 2008

China's corn prices to linger at low levels on new crop arrival


China's corn price is predicted to linger at low levels in the near-term, mainly due to the excessive corn supply.


China's corn supply in 2008 will still exceed domestic demand but a glut of corn would bring prices down, according to the USDA.


China's corn acreage  is expected to hit 28.8 million hectares in 2008, down 680,000 hectares, or 2.3 percent, over a year earlier, according to a forecast by the China National Grain and Oils Information Centre.


The centre said the nation's corn production is expected to hit 156 million tonnes, 3.7 million tonnes or 2.43 percent more than the previous year.


The report also expected yields to rise.


The arrival of the new corn crop is expected to exert much downward pressure on local corn prices, the report said.


Wheat acreage, expected at 23.9 million hectares, is up 0.76 percent from a year earlier whereas output is expected to rise nearly 3 percent  to 112.5 million tonnes.


Soy acreage is expected to reach 9.65 million hectares, up a more significant 10.24 percent, over a year earlier. Output is expected to rise sharply to 37.5 percent  over a year earlier.

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