twinspinmegawaysslot| The impact of U.S. corn production adjustment is limited: the domestic corn supply and demand gap still exists, and the future spot price is stable and strong

Newsletter summary

Global corn production has been reduced due to weather and pest problems in South America, and corn acreage in the United States has decreased, pushing up prices. The domestic supply pressure has been reduced, and the spot price during the corn period has risen steadily, but the terminal demand is relatively stable. USDA5 monthly report cut production and inventory, market expectations are slightly higher. In the medium to long term, corn prices may fluctuate upward.

Text of news flash

[due to multiple factors, the global corn market shows price fluctuations] production forecasts have been lowered due to weather and pest problems in major producing areas such as South America. At the same time, the reduction in corn acreage in the United States has also contributed toTwinspinmegawaysslotGlobal corn productionTwinspinmegawaysslotDowngrade. The USDA report in May reflects this trend. However, the recent dry weather in the United States is conducive to corn sowing, coupled with lower-than-expected export sales data, prices recovered after surging last week. [domestic corn market prices are strong] under the dual effects of reduced supply pressure and improved market sentiment, spot prices have shown a trend of stability and strength since May. Although there has been little change on the demand side, the expected decline in corn imports has brought positive results to the market. The data show that the progress of domestic grain sales is the same as that of the same period last year, the surplus grain at the grass-roots level is limited, and the supply pressure is reduced. Traders raised prices during spring ploughing in Northeast China, and the increase in policy collection and storage and the purchase of grain reserves further supported the price of corn. Traders in North China hold the mentality of being reluctant to sell because of their high costs. as the listing of new wheat is approaching, the purchasing and selling activities of corn are reduced and the price is supported. [Port grain stocks are on the high side, demand is at risk] according to the data, corn stocks in northern ports fell for the first time this year, but are still high compared with the same period last year. Guangdong Port corn stocks increased year-on-year, grain stocks also increased year-on-year. This inventory situation indicates that domestic corn demand may be at risk of being squeezed out by other grains. [domestic imports increased year-on-year, but month-on-month decline] China's corn imports increased in April from a year earlier, but continued to decline month-on-month. Month-on-month data so far this year show a downward trend in imports, and the market predicts that imports this year may be lower than last year. [the downstream demand boost is limited] the stock of live pigs continues to decline, which is not conducive to corn prices. Although feed demand may be supported in the short term, feed companies have a strong wait-and-see mood, the number of days of corn inventory remains stable, and the boost to the market is limited. [deep processing enterprises enter the de-inventory cycle] the product starch inventory has decreased for two consecutive weeks, but it is still at a high level compared with the same period last year. The lower operating rate of enterprises and the decline of raw material corn inventory indicate that deep processing enterprises may become more cautious. [USDA reports lower production and inventory estimates] the USDA report expects a decline in US and global corn production and final stocks, below market expectations, with a slightly higher report. The planting area of corn in China has declined slightly, and the cost of land rent in Northeast China has generally declined. [negative expansion of current basis in corn period] short-term spot prices rose, but futures prices rose even more, resulting in a negative expansion of the basis. The price gap between starch and corn is strong, but it is expected to converge as starch inventories remain high. [market outlook] under the background of the reduction of grass-roots surplus grain and the rising prices of traders, spot prices are expected to rise further. The demand side, affected by deep processing and feed demand, may remain stable in the short term, but in the long run, the gap between domestic supply and demand needs to be made up by imports. Considering that the current price is compared with the historical level, there is room for corn prices to rise in the medium to long term, and investors can consider the layout of bargain hunting. [

]