According
to forecasts from the National Grain & Oils Information Center and the
China Food Industry Association, China's corn output may reach 215 million
tonnes in 2013/2014, 7 million tonnes more than in 2012/2013. The increase in
corn output may result in a decrease in the price of corn. According to CCM's data, the output
and the annual market price of corn in China maintained an uptrend during
2009/2010-2012/2013.
Affected
by the corn harvest in Oct. 2013, the pressure from imported corn and the
depressed corn deep-processing industry, the domestic market is facing an
oversupply of corn.
According
to China Customs' data, the average corn import price was USD306.3/t in the
first eight months of 2013 in China. It was much lower than China's average
market price of corn which was USD380.5/t. During this period, China imported
more than 1.6 million tonnes of corn, which was already a relatively large
number.
As
for the corn deep-processing industry, it saw a downtrend. Xu Jiawan, the manager
of the corn purchasing department of Cargill Biochemical (Songyuan) Co., Ltd.
(Songyuan Cargill), said that the overall operating rate of the corn
deep-processing industry was less than 50%. For instance, the average operating
rate of domestic corn starch enterprises was presently as low as about 46%,
owing to the oversupply and the weak demand for corn starch from downstream
industries. Similarly, the average operating rate of alcohol enterprises is
also relatively low.
Liu
Xiaoran, deputy Secretary-General of the corn branch of the China Food Industry
Association, estimates that domestic corn consumption will be just 197.5
million tonnes in 2013/2014, which is much less than the output of corn.
Due
to the oversupply of corn, the market price of corn harvested in autumn may
decrease and it may be even lower than the government's corn purchasing price
for temporary reserves. Moreover, the overall quality of corn is not as high as
before, due to the severe weather this year, which may also suppress the market
price of corn.
Recently,
the purchasing prices of corn set by some leading corn deep-processing
enterprises in Northeast China have decreased compared with those in 2012. For
instance, on Sept. 25, 2013, Changchun Jincheng Corn Development Co., Ltd.
(Changchun Jincheng), a subsidiary of Changchun Dacheng Industrial Group Co.,
Ltd., set its corn purchasing price at USD341.5/t (RMB2,100/t), USD9.8/t
(RMB60/t) less than that in 2012. On Sept. 28, Songyuan Cargill set its corn
purchasing price as the same as that of Changchun Jincheng, but the price was
USD16.3/t (RMB100/t) less than that of last year. These companies' purchasing
prices are all below the corn purchasing price for the temporary corn reserves
set by the National Development and Reform Commission of China (NDRC).
As
early as July 3, 2013, the NDRC announced that China would increase the
purchasing price for temporary corn reserves in 2013/2014. The purchasing
prices of corn (third-grade of the national standards) will be USD366.3/t (RMB2,260/t),
USD366.3/t (RMB2,260/t), USD363.0/t (RMB2,240/t) and USD359.8/t (RMB2,220/t) in
Inner Mongolia, Liaoning, Jilin and Heilongjiang (the main corn planting areas
in China) respectively, which are all USD19.4/t (RMB120/t) higher than the
prices of 2012. (For more details, please refer to Corn Products China News
1307: China increases temporary reserve price of corn in 2013/2014).
Table of Contents of
Corn Products China News 1310:
China's
corn output to reach 215 million tonnes in 2013/2014
Global
Sweeteners'net loss increases to USD14.2 million, H1 2013
China's
market price of VD3 rebounds sharply, Sept. 2013
China's
lowest purchasing price of wheat to rise by RMB120/t in 2014
Low
operating rate of soybean crushers relates to tight supply of soybean
Price
update of corn products, Oct. 2013
China
Agri-Industries' performance of biochemical and bio-fuels segment maintains
stable, H1 2013
China's
xylitol export value up but price down, Jan.-Aug. 2013
Xiwang
Foodstuffs performs well in H1 2013
International
and domestic factors together impact China's sucrose price in Q4 2013
Chinese
corn products Imp. & Exp., Aug. 2013
Sixth
International Corn Industry Conference holds in Nanchang on Sept.
COFCO
Corporation to build Guangdong Grain & Oil Industrial Park in Dongguan
Zhaoqing
Coruscate's 600,000t/a starch syrup project launches in Chuzhou
Sales
revenue from Star Lake Bioscience's feed additives declines by 32.62% YoY, H1
2013
Global
Bio-chem suffers gross loss of USD27.63 million, H1 2013
Corn
Products China News, a monthly publication
issued by CCM on 20th, features “Supply and Demand”, “Import and
Export Analysis”, “Price Update”, “Market & Company Dynamics”, “Policy”, “Corn
Supply” and other more information researched and reported by CCM’s professional
journalists. It is a reliable intermediate for you to know more about the corn
industry in China
CCM is dedicated to market research in China
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