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The Demand is Soaring while the Supply is Limited, Driving the Corn Price Climbing in the Production and Sales Area in January

By CnAgri 2021-02-07 11:03:39 Print Tel:861064402118-822 Email: chen.wang@boabc.com

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As the Spring Festival is approaching, grain-consuming companies have concentrated on stocking in January, but after the temporary storage of corn stocks has emptied, farmers and traders are all optimistic about the price trend in the later period and are reluctant to sell. Coupled with the increasing international market prices, the domestic corn market price is constantly going up.  The average corn price in the production and sales areas in January was 2,867 yuan/ton, an increase of 270 yuan/ton or 10.4% from the previous month.
Recently, the stocking cycle of corn stocks within deep-processing enterprises has been prolonged, and the corn demand has surged. Meanwhile, the rebound of the epidemic in Hebei and Northeast China in January, which has hindered logistics in some areas, has caused poor corn supply, further pushing up local market prices.  In January, the average monthly price of corn in Northeast China was 2,805 yuan/ton, an increase of 271 yuan/ton or 10.7% from the previous month.
Driven by the Northeast region, deep processing companies in the Huanghuai region and North China have also continued to increase their purchase prices.  However, the purchase of wheat and other substitutes by feed companies has lowered down the competition for corn. In January, the price increase of corn in the Huanghuai region and North China remained at the bottom level. The local average corn price was 2,802 yuan/ton, a 9.8% increase of 249 yuan/ton from the previous month.
Although the southern port imports and domestic grain stocks are at a high level, the prices in the sales areas have been adjusted upwards following the rising corn prices in the production areas. The corn price in the sales area rose to 2,983 yuan/ton in January, a 10.5% growth of 283 yuan/ton from the previous month.
After February, most of the market entities in the production and sales areas have completed stocking up before the Spring Festival, corn purchases and sales will gradually stabilize, and corn prices will remain relatively stable. However, it is expected that corn prices will continue to show an upward trend after the production and processing gradually resumes after the Spring Festival.

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