SunSirs: China Domestic Corn Prices fluctuated and rose in June

According to the Commodity Market Analysis System of SunSirs, domestic corn prices stabilized in June and fluctuated upwards. On June 1st, the average price of third class yellow corn was 2,694.29 RMB/ton, and on June 30th, it was 2,760.00 RMB/ton, an increase of 2.44% during the month.

After entering summer, the high temperature and rainy weather in China have increased, making it more difficult for grain transportation. Trade entities have turned their attention to the purchase of new wheat. The domestic corn market trade volume has continued to decline, and the arrival volume of corn from ports and downstream deep processing enterprises continues to be low. To ensure production, enterprises have raised prices and replenished inventory, driving the domestic corn market to operate at a stronger price. After effectively replenishing downstream inventory, corn purchase prices have been lowered again, In early June, the overall price of domestic corn market fluctuated and moved forward.

In late June, there is a strong expectation of a global corn production reduction, coupled with a decreasing number of high-quality grain sources available for circulation in China. As grain trading entities continue to be bullish, the market is reluctant to sell and increase prices. Downstream corn arrivals continue to be low, and ports and downstream deep processing manufacturers have successively raised corn purchase prices, driving the domestic corn market price to continue to rise.

The latest customs data shows that in May 2023, China imported 1.66 million tons of corn, a decrease of 20.1% compared to the same period in 2022. From January to May, China imported 10.19 million tons of corn, a decrease of 10.6% compared to the same period in 2022.

In June, domestic egg prices continued to decline, falling by 9.09% during the month. Pig prices fluctuated and declined by 3.50% during the month. The breeding industry continued to be weak, with domestic pig grain dropping to around 5:1 at the end of the month. The loss area of the breeding industry continued to increase, and farmers' enthusiasm for supplementing the livestock market continued to decline. In addition, a large amount of malt entered the feeding market to squeeze out corn feed demand, and the domestic corn feed demand will become even weaker in the future.

According to corn product analysts from Business Society, the import volume of corn and its substitutes has slightly decreased, and there is gradually a shortage of high-quality grain sources available for circulation in China. It will still take some time for the new season corn to go public. The overall inventory of downstream enterprises of corn is low, and the mentality of trading entities is becoming stronger. In the short term, with downstream price increases and replenishment support, it is expected that there will still be some room for a rebound in the domestic corn market price in July.

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