As U.S. corn prices fall in anticipation of a big harvest, imports are becoming attractive to Chinese buyers. According to the cngrain.com weekly report on port corn prices, the price of U.S. corn reaching ports in southern China (the blue line in the chart below) is now 489 yuan/mt less than the domestic corn price in Guangdong Province.
The calculation is based on August 2 quotes of $224/metric ton of U.S. no. 2 corn at Gulf ports for September delivery. That's RMB 1385/mt in Chinese currency, and RMB 1991/mt on arrival in China plus taxes. The price was RMB 919/mt lower than a year ago when U.S. prices were at very high levels.
Blue line: price of corn originating in U.S. gulf ports for September delivery, reaching China ports.
Red line: price of Chinese corn at Guangdong Province.
Green bar: price advantage of imported U.S. corn over domestic corn.
There is downward pressure on Chinese corn prices. According to an August 7 Yumi.com.cn report, corn at Guangdong ports was trading at RMB 2450-2470 /mt. Supplies of domestic corn arriving at the ports are plentiful, but there are quality problems due to "high temperature and abundant rain." Traders are eager to sell.
In Hunan Province, the new corn crop is coming on the market. Traders there tell yumi.com.cn the amount of newly harvested corn is small and there are some mold problems. Buyers are reportedly cautious in their purchases.
The price is RMB 2460-2500 /mt in Zaozhuang, Shandong Province, and is weakening. In Shandong's Shouguang market, the corn price is RMB 2430 /mt, down RMB 14 from the previous week. Traders there are expecting price declines and are eager to sell. Plus downstream demand from processors is said to be poor. In Handan, Hebei Province, hot weather is causing corn with high moisture to mold and traders there are also eager to sell. Prices there are also under downward pressure.
No comments:
Post a Comment