Weekly Stock Analysis on Corn Starch in China (Week 43, 2018)
Bullish sentiment is still strong on current corn market, where farmers and traders are reluctant to sell, but subordinated warehouses and processing enterprises are striving to purchase. This boosts corn price to run high gradually so that corn cost is lifted. Besides, subject to the production limitation for environmental protection in Hebei, the overall operation rate remains low, with only 4 oil mills in production and some large mills operating unsteadily. In view of this, market participants still wait for a rosy starch market, driving starch price to go up by 20-70 yuan/tonne within this week. In the context of price hikes, mid-and- downstream enterprises also quicken to take delivery, and some companies even need to wait in line, creating a better shipping state. According to Cofeed, some starch companies have even signed supply contracts for November and December, so short-term starch stock will be still hard to be built and may still keep declining. Operation rate, corn price trend and downstream procurement mentality are worthy of attention for later market.
According to Cofeed, corn starch stock in 81 processing factories surveyed totaled 450,500 tonnes as of 24th Oct (Week 43), down 49,800 tonnes by 9.95% from 500,300 tonnes last week.
Fig.: China’s Corn Starch Stocks Weekly Based on 81 Businesses
