SunSirs: New Season's Bumper Crops Expected; Soybean and Corn Markets Lack Highlights

The market has mixed views on the future prices of new-season soybeans and corn. The opening price of soybeans is expected to be around 2 RMB per 500g, while there is some controversy over the opening price of corn (0.8 to 0.85 RMB per 500g). Currently, it is likely to be slightly higher than last year's level.

In the third quarter of 2025, corn prices fell, mainly due to the policy auction and the increasingly strong expectation of a bumper U.S. corn harvest. August is a time node for the "new and old" market exchange, with Northeast soybeans and corn in the growth stage, and corn in Hubei, Xinjiang and other producing areas has already been sporadically launched, and the price performance is not optimistic. Recently, the author went to the soybean and corn producing areas of Heilongjiang and Inner Mongolia for field research. Overall, the estimated starting price of soybeans is 2 RMB / 500g, and the estimated starting price of corn is 0.8~0.85 RMB / 500g. Enterprises that have competed in bidding for soybeans and corn will face the pressure of returning grain, and will actively enter the market to purchase after the new crop is launched, which is expected to support the market price to a certain extent.

The 2023/2024 marketing year could be described as a "freezing" period for grain traders, but the situation improved slightly in the 2024/2025 marketing year. However, grain prices have been fluctuating, especially in the third quarter when the harvest is not yet available. The main reasons include the policy auction which has alleviated the tight supply in the market, and the strong expectation of a bumper harvest in the United States, which has led to a downward trend in domestic and foreign grain prices. Domestically, August is a time node for the "new and old" alternation in the market. Soybeans and corn in Northeast China are still in the growth stage, but corn in Hubei and Xinjiang has already started to be sporadically available in the market, and the price performance is not optimistic. Feed and processing enterprises have already started to get ready, waiting for the price to fall to their psychological level and to build up their inventory when the price is low.

Crops are growing well

Growth of new crops: This summer, Heilongjiang has received sufficient rainfall and accumulated higher temperatures, which is beneficial for the growth of soybeans and corn. However, there are local cases of low temperatures and lack of sunlight or pests and diseases, but the impact is not significant. As of mid to late August, the overall growth of soybeans and corn in Heilongjiang and the northeast of Inner Mongolia is good. Only individual areas have experienced drought (which has little impact on yield). If there is no early frost in the later stage, a good harvest of new soybeans and corn is expected.

Trade situation of old grain: At present, the market price of old corn and soybeans is low, and traders who still have surplus grain are not optimistic about the future market. Moreover, as the new grain is about to be listed, the mentality of traders to hold grain and not sell it is weakening.

New grain starting price estimate: Traders and processing enterprises generally believe that the starting price of soybeans and corn autumn grain this year will be higher than last year at the same period, but there is no high expectation. The starting price of soybeans is expected to be around 2 RMB / 500g (last year was 2~2.1 RMB / 500g), and the starting price of corn 14 dry grain at 0.8 RMB / 500g (last year was 0.75 RMB / 500g).

Establishing a warehouse and grain return: Trade houses are still willing to establish warehouses, and it is a good time for them to do so when the purchase price falls to the right level (e.g., soybean price around 1.7 RMB per 500g) and before the State Grain Reserve makes a large purchase. In terms of grain return in the later period (when enterprises return grain to the State Grain Reserve after purchasing it at auction), if enterprises actively purchase, it will support the market price to some extent, but it will also depend on the farmers' willingness to sell grain at that time.

In terms of planting area, the trend of increasing soybean planting area in Heilongjiang this year is more obvious. The main reasons are: one is that the corn price has been continuously falling last year, and the planting benefit gap between soybeans and corn has narrowed again; the other is that the subsidies for soybean producers, crop rotation subsidies, close planting subsidies and other subsidies have increased year by year in recent years, stimulating farmers' enthusiasm for planting.

In terms of the growth of new-season crops, the soybean and corn growth in Northeast China is good this year. The autumn grain sowing stage in Northeast China was rainy, resulting in a delay of one to ten days in the spring sowing time of crops in most parts of Heilongjiang Province compared to last year. However, due to the resumption of the Sino-US trade friction and the rebound of soybean prices after the New Year, farmers' enthusiasm for planting soybeans is significantly higher than in previous years. It is well known that the protein content of Northeast China soybeans is closely related to the weather. Although the duration of sunshine this year is slightly less than in previous years, the accumulated temperature has reached the growth standard of soybeans and corn, so the overall growth of crops is good. Moreover, the temperature this year is higher than the normal period, with sufficient light and heat and suitable moisture, which is conducive to the growth of spring corn, soybeans, and one-season rice. At present, the crop development period in most production areas is normal or ahead of schedule.

As of the late part of August, most of the northern spring corn was in the silking stage, some of the corn in the northern part of Xinjiang had entered the milk stage, most of the corn in the southwestern region was in the silking to milk stage and the maturity stage, and the overall development period of spring corn was normal or 3 to 7 days earlier than normal. Most of the summer corn in North China, the Huanghuai region, and the northwest region was in the jointing stage, some parts of Henan had entered the milk stage, and most of the southwestern region was in the silking to milk stage, with the overall development period being normal or slightly earlier, although the development period of summer corn in southern Hebei, northern Henan, and the northwest of Yunnan was slightly later.

From the survey of regions and plots, in terms of soybeans, the plant height of crops in the Jiamusi area of eastern Heilongjiang is lower than that in the Yichun area, but the condition of soybean grains is better, and overall, the protein content will not be lower than the average level of last year. Moreover, from the number of bean nodes and bean pods, the overall situation is better than last year.

Regarding Corn, the soil around Hailar in Inner Mongolia was relatively dry before, and the corn plants occasionally curled their leaves. However, the subsequent rainfall alleviated the drought.
Corn in Inner Mongolia and Qiqihar is growing well, with the overall plant height higher than that of the same period last year.

By the end of the research, no large-scale pest or disease infestations had been observed.From the perspective of traders and farmers' psychology, in the past two years, the most concerned issue in the soybean trade is the auction of grain. Due to the regulations of the State Grain Reserve, the price of auctioned grain is market-oriented, but the price of soybean grain is fixed at 4200 RMB/ton, i.e. 2.1 RMB/500g, so most related enterprises want to purchase new grain when the price of the new soybean is below 2 RMB/500g. However, since some farmers sold grain at the wrong time last year and did not benefit from the later rebound of soybean prices, there may be a mentality of holding back sales among farmers this year.

The overall cost of land leasing has decreased this year, so the expected selling price of grain by farmers is generally not as high as last year. For example, the cost of land leasing in the Qitaihe area has dropped from 12,000 RMB/ha to 10,000~11,000 RMB/ha, while the cost of land leasing in the Jiaxin Farm of Yichun, Heilongjiang, is basically the same as last year, at 11,500~12,000 RMB/ha. The overall planting cost for land-leasing farmers is 16,000~17,000 RMB/ha, and the planting cost of the farm is about 1,000 RMB/ha higher than that of the farmers.

After the autumn harvest last year, the domestic soybean price has been falling, so some enterprises that hedge on the futures market did not benefit from the "price difference" between the low grain purchasing price and the high grain repayment price. Moreover, the market generally expects a bumper harvest of autumn grain this year, so traders are relatively cautious about futures market hedging and " washing basis" operations.

Overall, at present, the surplus grain in the main production areas of Northeast China is high-quality and high-priced, but the grain source is scarce. Since August, the price of soybeans in the main production areas of Northeast China has been stable and weak, the surplus grain at the grassroots level has bottomed out, and the inventory in the hands of traders has also gradually decreased. The continuous auction of stored soybeans has brought a certain supplement to the spot market. From the start of the auction to the end of August, the transaction rate of the grain auctioned by the State Grain Reserve was high, and it was all sold at a premium. This shows that the market share of the grassroots grain market is constantly decreasing, and some traders need to purchase a certain amount of old grain to maintain customer relationships. However, recently, the State Grain Reserve has reduced the auction base price, which has weakened the support for the spot market price of soybeans, and at the same time, the general grain quality of the mainstream market has been under pressure from the auction grain, most traders are not very willing to pick up goods, and mainly consume inventory, waiting to see the new grain.

The opening price is likely to be slightly higher.

The market has mixed views on the future prices of new-season soybeans and corn. The opening price of soybeans is expected to be around 2 RMB per 500g, while the opening price of corn is slightly controversial (0.8~0.85 RMB per 500g), and it is likely to be slightly higher than last year's level. However, new-season soybeans and corn in Northeast China have not yet been launched, and downstream enterprises still need to purchase old grain for processing and production. The overall price decline is controllable, and the current old corn for 2024 is already not much, and the cost of old grain is high, so traders have a certain tendency to support prices. There is still about one month before the new grain is initially produced and priced, and it is recommended that traders lock in profits in time. Enterprises that have bid for soybeans and corn and are facing the pressure of returning grain will definitely actively enter the market to purchase after the new crop is launched, and it is expected that they will support the market price to some extent.

In terms of arbitrage in the inter-month price spread, the current price spread between the January and May corn contracts is around -68 RMB/ton, which is at a relatively low level for the same period in the past ten years. The main reason is the expectation of a bumper harvest for the new crop, so the price trend of the nearby contract is weaker than that of the distant contract, and January is the small peak of grain sales every year, which weakens the support of the futures market. From the historical trend, the price spread between the January and May contracts is likely to fluctuate and narrow, so investors can take advantage of the narrowing of the price spread between the January and May contracts. At present, the price spread between the January and May soybean contracts has not shown a clear trend, and investors can continue to observe. In addition, it is worth considering the arbitrage operation of buying the November contract and selling the January contract.

As an integrated internet platform providing benchmark prices; On September 4th, the benchmark price of soybeans by SunSirs was 4,312.00 RMB per ton, remaining the same as at the beginning of this month.

On September 4th, the benchmark price of corn on SunSirs was 2,302.86 RMB per ton, an increase of 0.06% compared with the beginning of this month (2,301.43 RMB per ton).

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