Demand for corn continues to rise

Recently, even with the overall corn posture of sideways consolidation, both long and short-term operations tend to be cautious, but they are still confronting Masukura, and the trend of the market is facing direction. The author believes that even after the sharp gap in late mid-February and late fall, even corn has been effectively technically supported. After a slight rebound, the market will return to a strong position. The reason is that the international market is still strong and domestic demand has entered the peak season.

The international market supply is tight for a long time. The uptrend is still expected. The CBOT corn week K line shows that it rebounded again last week to a high of 742 cents per bushel, although it fell slightly by 6.25 cents per bushel last Friday. It closed at 728.75 cents per bushel, but its long-term uptrend remains intact.

Although the U.S. Department of Agriculture’s Outlook Forum at the end of February predicted that US corn planting area for 2011/2012 will reach the second highest level in history at 92 million acres and production is expected to reach a record high of 13.73 billion bushels, it will be difficult to ease the current market supply and demand tension. pattern. In addition, due to the increase in demand, the ending inventory for the new year is expected to be only 865 million bushels, slightly higher than the previous year, which is only half of the 2009/2010 ending stocks. It is worth noting that international oil prices have effectively broken through and stabilized at US$100/bbl, and the upside space is fully open, and a substantial increase in the demand for corn energy conversion can be expected. Under the condition that the quantitative easing monetary policy is being implemented, the excess liquidity has intensified, and the dollar index has reached a new low, which is self-evident for the promotion of commodity prices. Therefore, it is only a matter of time before CBOT corn breaks the historical high. Before the new corn harvest in the third quarter, the strong corn will not change. Calculated at the current prices, the duty-paid price of imports of US corn to the mainland has reached 2,850 yuan/ton or more. Even if all taxes for the import link are exempted in the later period, the international corn price is still strong on the domestic market.

The full start of domestic demand, prices, and the overall start-up of space demand are mainly reflected in the sharp increase in spot purchase prices. For example, the purchase price of corn in northeastern production areas has risen by RMB 40/t before the Spring Festival and rose to RMB 1,900/t; Shandong Liaocheng The purchase price of corn rose by 70 yuan/ton to reach 1990-2000 yuan/ton. In addition to the seasonal increase in maize demand driven by a large amount of restocking in the aquaculture industry, the strong demand from state-owned grain warehouses and deep-processing companies has also provided support for corn prices.

It is understood that from 2007 to 2009, the State Grain Stores temporarily stored and stored approximately 40 million tons of corn, but as of March 1, has accumulated auctioned central reserves and temporary reserves of 46.52 million tons of corn, plus previously targeted sales of 5.8 million Tons, the central reserve and temporary reserves of corn have sold more than 50 million tons. Although the author has no way of knowing the amount of central reserve corn that was later auctioned, it is difficult to judge the central reserve corn surplus stocks. However, the above data shows that the State Reserve corn stocks have been significantly reduced and the demand for supplementary stocks is strong. In the market situation where import costs remain high, the State Reserve Bank of Corn can only be resolved through the acquisition of the domestic market, and the demand is huge. Although the deep processing enterprises in the previous production areas have stopped, the acquisition of the State Reserve corn is not satisfactory. With the recovery of the acquisitions by various parties in the market in recent days, the price of corn under intense competition still has room to rise.

From the perspective of actual market demand, the seasonal recovery of feed demand is inevitable. It is worth noting that deep-processing companies are now rejuvenated after a short period of downturn. Taking the author's follow-up investigation of Shandong Hongxing Corn Development Company as an example, the ex-factory price of starch has risen from 2,900-2,950 yuan/ton before the Spring Festival to the current highest level of 3,300 yuan/ton, which is not difficult to extrapolate, according to the current level of approximately 2100. Yuan/ton corn enters the factory price, its theoretical processing profit is about 300 yuan/ton. The good processing efficiency will surely drive the increase in demand and will drive prices further.

To sum up, even after the corn is shaking up, it will continue its rising trend. The target of the main 1109 contract in the second and third quarters can be seen at 2,600 yuan/ton.