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Daily Review on Grain Market in China

2018-10-15 www.cofeed.com
      Today ( Oct. 15th), the market for grains in China is shown as follows:

      Corn: Today domestic corn price sees rises in fluctuations. The procurement price in Shandong further processing companies prevails at 1,830-1,970 yuan/tonne, some gaining another 10-56 yuan/tonne from last Friday. In Jinzhou port, Liaoning, the prevailing purchasing price for 2017 dried corn is 1,760-1,770 yuan/tonne (volume weight 700 g/L), with those at high price gaining 10 yuan/tonne from last Friday; and 2018 new corn is priced at 1,450-1,460 yuan/tonne for 30% moisture, with those at highs gaining 10 yuan/tonne from last Friday, and 1,770-1,790 yuan/tonne (volume weight over 700g/L) for 15% moisture, up 10-15 yuan/tonne from last Friday. In Bayuquan port, Liaoning, 2018 new corn is priced steadily at 1,770-1,780 yuan/tonne and old corn at 1,730-1,750 yuan/tonne. In Shekou port, Guandong, price for second-class old corn is 1,890-1,910 yuan/tonne, with those at low losing 10 yuan from last Friday. Corn prices in North China keep going up recently, and some even nearly hit the top of 2 yuan/kg. This can be contributed to the periodic supply tensions where farmers are unwilling to sell and traders are keen on hoarding, while collection & storage and processing enterprises are active in purchasing and even create a buying spree. However, due to imminent sales of new corn in Northeast China and the stimulation of rising price, market participants shift their attitude toward hoarding in North China, and some branches may start to sell intensively. In addition, hog breeding is now subject to the damaging ASF, so corn feed consumption is slow in recovery. In general, corn price may steadily go strong in fluctuation in near term, but once corn stock reaches its saturation, corn price may fall back under the pressure of intensive sales. And later focus shall be on weather in main planted area, new corn harvests and sales, as well as downstream demands.


      Sorghum: Imported sorghum prices see some declines in a stable state today. (US sorghum: raw sorghum remains stable at 2,100 yuan/tonne and 2,130-2,150 yuan/tonne, in Nantong and Shanghai respectively, and is not offered in Guangdong. Australian sorghum: raw sorghum and dried sorghum remains stable at 2,250 and 2,350 respectively in Qingdao, and raw sorghum alone falls 50 yuan/tonnes to 2,330-2,350 in Shanghai. Domestic sorghum price drops: Purchasing prices for raw sorghum and dried sorghum with freight fall 40 and 140 respectively to 1,700 and 1,800 yuan/tonne in Hinggan League, Inner Mongolia, and it is stable for both new & raw and dried sorghum at 1,800 and 2,080 yuan/tonne separately in Chifeng, Inner Mongolia. 


      Barley: Price for barley at port remains stable today (Australian barley: 2,060 yuan/tonne in Shandong, up 10; 2,050 in Nantong, unchanged; 2,000 in Guangdong. French barley: 1,970-1,980 in Nantong, unchanged; 1,880 in Guangdong, up 10. Ukrainian barley: 1,950-1,960 in Nantong, unchanged).


      Currently, both sorghum and barley, as energy feed substitute of corn, post no price advantage, especially Australian sorghum, which is set aside for its higher price than domestic one. So today Australian sorghum price at port falls back due to the crackdown from weak fundamentals. However, amid the ongoing trade tensions, import cost of US sorghum stays at a high level, thus pushing back the importers and dragging down the stock at main ports. Weighing the current market, traders still remain firm in propping up prices. On the other side, barley at port is also under tight supply and at high costs. Such bullish factors together support the grain market at port, hence, the overall market will run stable even if short adjustment occurs, and it will be guided by latest news. 


(USD $1=CNY 6.92)