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Daily Review on Grain Market in China--1/8/2021

2021-01-08 www.cofeed.com

Today (Jan 8), the market for grains in China is shown as follows:

 

Corn:

 

Corn prices continue rising in China today. And the average price is 2,707 CNY/tonne nationwide, up 16 CNY/tonne from yesterday. Deep-processing enterprises in Shandong offer at 2,770-2,920 CNY/tonne, an increase of 20-50 CNY/tonne from yesterday. At Jinzhou port, Liaoning, new corn (volume weight with 720 g/L, moisture content within 15%, impurity with 1%, mildew with 2%) is priced at 2,780 CNY/tonne, a further rise of 40 CNY/tonne at the high level. At Bayuquan port, Liaoning, Grade-II new corn of 2020 (volume weight with 720 g/L, moisture content within 15%, impurity with 1%, mildew with 2%) is priced at 2,780 CNY/tonne, flat from yesterday. Tiancheng Group in Siping, Jilin offers the price of Grade-III new corn steadily at 2,400 CNY/tonne. The purchasing price of Grade-III corn by Longfeng company in Suihua Qinggang, Heilongjiang is 2,560 CNY/tonne, up 20 CNY/tonne from yesterday.

 

Market has it rumored that logistics will be suspended in advance, so deep-processing enterprises have started stocking up after New Year’s Day. Due to the resurgence of COVID-19 in North China and lockdowns in portions of this region, the buying and selling of corn have bogged down. There are over 200 trucks waiting to get unloaded in Shandong earlier this morning. Most of deep-processing enterprises raise the purchasing price by 10-50 CNY/tonne, and the price offered by Ensign Co. ltd has recorded a high of 2,900 CNY/tonne. Besides, due to a reduction in production in main producing regions, corn market is heading for a foreseeable tight supply, offering support to market. Plus, corn sales are in faster progress compared to previous years due to high prices, so corn stocks are not many left in some farmers’ hand. With the price increasing, farmers who have sufficient inventories in hand become more reluctant to sell their corn. In addition to this, corn futures uninterruptedly go up on Dalian Commodity Exchange. Plus, the price inversion between South China and North China offers a support to price at Southern and Northern ports, with a rise of 20-40 CNY/tonne. Hence, short-term corn market still carries the upside potential based on bullish fundamentals. Market participants should pay attention to sales mentality and policy guidelines.

 

Sorghum:

 

New sorghum prices remain stable in China today. New sorghum planted area and production suffer a reduction under the influence of typhoons this year and an expansion in other crops, so farmers show strong sentiment in propping up prices. Moreover, large-scale well-known wineries gradually start their stocking up for the Chinese Lunar New Year. Growing downstream demand is thus support domestic sorghum prices to keep firm. But imported sorghum is in huge supply and of low prices, so some small distilleries are purchasing imported sorghum to save cost. This is weighing down domestic sorghum market.

 

Imported sorghum prices are stable in China today, with the average price at 2,898 CNY/tonne. Imported sorghum is in huge arrivals and adequate stocks at domestic port now. As of Dec 31, imported sorghum stocks total 196,000 tonnes at Guangdong ports. And an expected rise in sorghum arrivals will probably weigh down sorghum prices in China. But a sustain recovery in hog stocks and in feed demand will lend support to imported sorghum prices.

 

Barley:

 

Imported barley prices steady in China today, with the overall price at 2,197 CNY/tonne. As of Dec 31, imported barley stocks total 521,000 tonnes at Guangdong ports. While more cargoes are expected to arrive at ports, the overall demand remains weak, which will be negative to the market. In addition, barley shipments from Argentina, Canada and France have been flowing toward China as a conflict between China and Australia reshapes global trade pattern, which is also undermining domestic barley market. However, China has halted barley imports from Australia’s largest grain exporter whose shipments were found with pests on multiple occasions, further disrupting barley trade between these two nations. Moreover, some domestic feed manufacturers also start using barley as corn prices remain high, which also bolsters barley prices. Overall, imported barley prices are predicted to stay stable in China.

 

(USD $1=CNY ¥6.47)