November 19, 2009
China corn prices up as heavy snowfalls block transportation
Corn prices in major producing areas of China were higher in the week to Wednesday (November 18), as heavy snowfalls blocked transportation of the crop.
Corn prices in the northeastern Jilin province were RMB20 a tonne higher at RMB1,440 (US$210.88) to RMB1,520 (US$222.60)/tonne.
Corn prices in the eastern province of Shandong were between RMB1,790-RMB1,960/tonne, up RMB20-RMB40/tonne from a week ago.
Heavy snowfalls in the north of the country blocked sales of the crop or made local harvesting almost impossible.
Tightening supply helped to push up the prices, and local processors don't have much stock on hand.
Processors in the northeast raised bidding prices but farmers were reluctant to sell due to expectations that prices would rise more.
With the weather turning better, transportation bottlenecks will ease and corn supply will increase, putting pressure on prices, analysts said.
However, government buying will continue to support the prices, limiting any fall, they said.
The government sold 420,400 tonnes of corn from its reserves Tuesday, or 28 percent of the 1.52 million tonnes it offered to sell.
US$1 = RMB6.82 (Nov 19)
