Optimistic expectations for corn planting area this year
As of now, new-season spring corn planting in Northeast China is nearing completion, and as winter wheat in the interior enters its maturity period, the relay intercropping of new-season summer corn in wheat fields in the interior has also begun. Given the current huge domestic corn inventory and relatively sluggish prices, has the corn area already planted by farmers in Northeast China increased or decreased? And what are the corn planting intentions of farmers in the interior?
“For corn of relatively good quality that can be used as feed raw material, small traders are buying at 1.08—1.09 yuan/jin, while large grain depots are buying feed corn that has been winnowed and sieved at 1.13 yuan/jin.” Qi Kai, a corn trader in Hua County, Henan, told the Futures Daily reporter that compared with the same period in previous years, corn prices in Henan and neighboring provinces are low. Because farmers still hold a relatively large amount of surplus grain, state reserve corn inventories are huge, and the sale of state-reserved corn produced in Northeast China was advanced compared with last year, it is estimated that before the new-season corn comes onto the market, domestic corn market prices will find it hard to improve.
The reporter checked relevant information and learned that as of April 30, the temporary purchase and storage work for 2014-produced corn in Northeast China had ended. The three northeastern provinces and the Inner Mongolia Autonomous Region had accumulated nearly 84 million tons of 2014-produced corn in reserve purchases, and various grain enterprises in 11 major corn-producing regions including Heilongjiang and Jilin had purchased about 130 million tons of 2014-produced corn, an increase of nearly 15 million tons over the same period of the previous year. Based on a national total corn output of about 220 million tons, and taking into account that the government purchased and stored 70 million tons of corn in Northeast China in 2014, the current state reserve corn inventory is very large, and most of the corn market supply is also in the hands of the government. With the current sale time of state reserve corn fixed, the quantity sufficient, the floor price determined, and the intention of selling at a profit clearly evident, the market expects that domestic corn prices will neither rise nor fall by much. And price stability will mean that farmers' planting habits and intentions will not undergo large-scale adjustment, so the market expects that the possibility of farmers reducing corn planting area this year is not great.
Li Yanfei, a grain and oil trader in Dalian, told the reporter that recently the institution where he works organized personnel to conduct a survey of new-season corn planting in Liaoning, Jilin and other places. From the situation of their on-site survey, apart from a few areas where corn sowing was delayed due to drought, farmers in most parts of Northeast China had completed spring corn sowing according to the solar terms, and the sown area still showed a trend of steady growth, with very few farmers taking the initiative to adjust the planting structure.
“In the words of farmers in Northeast China, planting corn is simple and quick, and the income is relatively good. In addition, most young people in the village now go out to work to earn money, and the elderly who remain cannot manage growing other crops, so corn, which is highly mechanized and requires little labor input, is more welcomed by farmers.” Li Yanfei introduced that apart from places such as Fuyu in Northeast China where peanut planting returns are relatively high and part of the corn area was reduced, farmers in the vast majority of areas chose to plant corn. Farmers in the areas of Jilin, Panshi and Meihekou even switched to corn because rice planting is labor-intensive, and the situation of converting paddy fields to dry land has occurred locally for five or six consecutive years.
Qi Kai told the reporter that Henan, Shandong, Hebei, Hubei and other places have now entered the period of relay intercropping peanuts, corn and cotton in wheat fields. Because in recent years corn sowing and harvesting have largely been mechanized, requiring less labor, taking less time and costing less, unless the income from planting peanuts and cotton is far higher than that from planting corn, farmers almost all choose to plant corn during the wheat field relay intercropping period and after wheat harvest.
When the reporter conducted market surveys in Yanjin of Henan, Heze of Shandong, Hengshui of Hebei, and Gong'an of Hubei, it was found that farmers in the interior now mainly plant two crops throughout the year, namely wheat and corn, and the varieties planted are very limited, whereas in the past in summer, besides planting corn, farmers in various places also planted large amounts of mung beans, red beans, sesame, sorghum and other crops.
Multiple interviewed persons believed that due to the increase in new-season corn planting area, and in the absence of extreme weather, this year's corn planting area is fairly optimistic, but prices are not favored.