Corn prices continue to rise, rain and snow weather affects buying and selling

In mid-November, supported by the national temporary reserve purchase policy and affected by widespread rain and snow weather in production areas, domestic corn prices continued to maintain an upward trend, especially in North China where the rate of increase in corn prices remained at a relatively high level.

Monitoring by the China Grain Network Data Center shows that as of November 19, the 2015 44th period Sinograin national corn purchase price index was 144.16, up 0.26% week-on-week.

According to data monitoring system of relevant institutions, in the week ending November 20, the average price of grade 3 yellow corn at the beginning of the week was 1950.00 yuan/ton, and the average price at the weekend was 1966.67 yuan/ton, up 0.85%.

Data from relevant national departments show that as of November 15, various grain enterprises in 11 main production areas including Heilongjiang and Shandong had cumulatively purchased 13.99 million tons of newly produced corn. From the 10th to the 15th, a total of 4.75 million tons were purchased. Among these, the total temporary reserve purchase volume in Northeast China was 6.11 million tons,

and from the 10th to the 15th, a total of 3.69 million tons were purchased.

Corn prices in Northeast China generally rise

As temporary reserve purchases gradually unfold in Northeast production areas, purchase volumes in various places have gradually increased, and grassroots corn prices have also been relatively firm, mostly rising compared with the earlier period. It is understood that snowfall weather recently appeared in central and eastern Inner Mongolia, southwestern Heilongjiang, Jilin, and western Liaoning, affecting corn purchasing and logistics transportation.

On November 19, the purchase price of deep-processing enterprises in Zhaodong, Heilongjiang was 1710-1730 yuan/ton, with the low point up 20 yuan/ton from last week; the deep-processing purchase price in Tongliao, Inner Mongolia was 1820-1860 yuan/ton, with the mainstream price up 20 yuan/ton from last week; the purchase price of deep-processing enterprises in Songyuan, Jilin was 1840-1880 yuan/ton, and the purchase price of feed enterprises in Shenyang, Liaoning was 1940-1960 yuan/ton, both up 30-40 yuan/ton from last week.

From the current market perspective, social purchasing progress in the Northeast corn market is slower year-on-year, but policy-based purchasing progress is noticeably faster. The main reason is that this year intermediate traders have almost no self-operated inventory, and trade is mostly based on temporary reserve transactions.

According to statistics, as of November 15, the total temporary reserve purchase volume in Northeast China was 6.11 million tons, higher than the same period last year. Among these, Heilongjiang was 4.4896 million tons, Jilin was 871,300 tons, Liaoning was 53,400 tons, and Inner Mongolia was 695,700 tons.

Corn price rise in North China remains relatively fast

Recently, due to relatively frequent rain and snow weather in North China, grassroots market buying and selling continued to be affected, and the rate of corn price increase remained at a relatively high level. Driven by the mentality of selling on declines rather than on rises, farmers' enthusiasm for selling grain is not strong, and most are watching and holding back sales. Because grain supply is relatively tight and grassroots dry grain supply is insufficient, current enterprise purchases have mostly begun to relax moisture standards.

On November 19, the purchase price of medium-grade corn by feed enterprises in Beijing was 1950 yuan/ton, up 70 yuan/ton week-on-week; the purchase price of medium-grade corn by feed enterprises in Shijiazhuang, Hebei was 1960 yuan/ton, up 100 yuan/ton week-on-week; the purchase price of medium-grade corn by deep-processing enterprises in Shandong was 2020 yuan/ton, up 120 yuan/ton week-on-week; the purchase price of medium-grade corn by feed enterprises in Anyang, Hebei was 1820 yuan/ton, up 40 yuan/ton week-on-week.

Up to now, continuous rain, snow, and haze weather in North China has lasted for more than half a month, which has led to poor logistics and corn threshing, and grain sources appear slightly tight. Weather forecasts show that North China will still have continuous rainy weather in the next two weeks, and it is estimated that in the short term weather factors will still support corn prices in North China.

Corn prices at northern and southern ports fluctuate upward

Recently, affected by rising grain source prices in production areas and reduced arrivals caused by snowfall, corn prices at northern and southern ports fluctuated upward. A relatively large proportion of arrivals at northern ports entered temporary reserves, and temporary reserve purchase prices were higher than commercial grain, mostly priced according to quality. Because corn prices in production areas have risen relatively quickly recently, feed enterprises at southern ports have somewhat strengthened their willingness to restock, and corn inventory at ports has declined relatively quickly.

It is understood that on November 18, domestic trade corn inventory at Guangdong ports was 206,000 tons, down 51,000 tons from the same period last week; foreign trade inventory was already 0.

On November 19, at Bayuquan and Jinzhou Port in the north, for Liaoning corn with moisture within 15%, test weight above 700g/L, and mildew rate within 3%, the mainstream purchase price was 1980-2000 yuan/ton, and the theoretical flat warehouse price was 2030-2050 yuan/ton, both up 10-20 yuan/ton from last week. The transaction price of high-quality Liaoning and Jilin corn with 14.5% moisture at Shenzhen Port in Guangdong was 2130-2150 yuan/ton, up 10-20 yuan/ton from last week; the price of Hebei corn was 2020-2060 yuan/ton, up 40 yuan/ton from last week.

At present, the price difference between Northeast corn and North China corn at Guangdong ports is 90-110 yuan/ton, narrowed by 20 yuan/ton from last week and narrowed by 130 yuan/ton from the beginning of the month.

Corn prices in sales areas continue to rise slightly in tandem

Dragged down by rainy weather in North China, grain source purchasing in southern sales area markets was hindered, and arrivals at grain-using enterprises declined. Because most grain sources in the southern market come from North China, the continuous rise in North China corn prices continued to drive prices in southern sales areas upward in tandem, by 30—60 yuan/ton. Because demand in sales areas is still recovering slowly, enterprise procurement is still only maintaining normal production, and the willingness to increase inventory is not strong, so the price increase is noticeably smaller than in production areas.

On November 19, the arrival price of grade 2 corn in Xuzhou, Jiangsu was 1880-1980 yuan/ton, the arrival price of grade 2 corn in Wuhan, Hubei was 2180-2200 yuan/ton, the arrival price of grade 2 corn in Changsha, Hunan was 2200-2230 yuan/ton, the arrival price of grade 2 corn in Nanchang, Jiangxi was 2220-2260 yuan/ton, and the arrival price of grade 2 corn in Chengdu, Sichuan was 2090-2160 yuan/ton.

Exports better than expected, US corn futures rebound

Recently, the International Grains Council lowered its 2015-16 corn production estimate, forecasting global corn production at 967 million tons, a downward revision of 3 million tons. Internet + agricultural products Internet + agriculture Internet + industry small-leaf red sandalwood landscaping seedlings rosin aquatic product processing stone papermaking modern agriculture ecological agriculture papermaking industry energy conservation and emission reduction feed industry Last week, supported by a better-than-expected weekly export sales report, US corn futures prices rebounded on short covering. On November 20, the CBOT December corn contract reported 3.63-1/4 dollars per bushel, up 1.5% during the week, the largest weekly gain since the end of September.

The USDA weekly export sales report shows that in the week ending November 12, US corn export sales for the 2015-16 marketing year were 779,800 tons, higher than the market estimate range of 500,000-700,000 tons.

On November 19, the FOB price of US No. 2 yellow corn delivered in December from the US Gulf was 170.2 dollars/ton, equivalent to 1086 yuan/ton; the total cost after tax upon arrival at Chinese ports was about 1558 yuan/ton, down 163 yuan/ton from the same period last year.