Corn Further Processing Companies’ Operating Rate Would Show the Decreasing Trend

By CnAgri2017-04-20 09:32:31 Print

Since 2017, the operating rate of corn further processing companies has maintained at a high level. In April, the operating rate of corn starch and alcohol companies still reached up to 75% and 78%, 18 percentage points and 17 percentage points higher than that of the same period of last year. But, it was predicted the operating rate would show the decreasing trend. The main reasons are as the followings:

(1) Further processed products especially alcohol enter off season of demand, however further processing companies ran full production in previous stages, and have high stocks, so it needs certain time to run down stocks.

(2) Along with further processing margins dropping, the companies in Huang-Huai Region of north China have fully fallen into loss and have weak willingness to run full production.

(3) Further processing companies are entering the period of a routine overhaul and some companies have planned an overhaul.

Further processing companies in the northeast still can enjoy the subsidies before June, and it is predicted that the operating rate would slow down; the decline in Huang-Huai Region of north China would be obvious.