【Main viewpoint】Corn supply pressure is gradually easing, the follow-up corn price is expected to run strongly in the range shock, the U.S. corn has also entered the weather trading stage, and the U.S. agricultural report is bullish again, under the resonance of the internal and external disks, corn prices are still expected to rise in the medium term, the market bullish sentiment is heating up, and the bottom of the annual corn price is relatively solid.
After the May Day holiday, the domestic corn spot price continued to be weak, after the May Day holiday, the domestic fundamentals basically did not change, but the price of corn in the international market rose, South America due to floods and pests and diseases reduced production, and the US corn sowing period was delayed due to rainy weather have boosted international corn and soybean prices, which in turn drove the domestic corn market sentiment.
Prices remained weak during the May Day period, and the mood heated up after the May Day
Entering May, the domestic corn spot price trend is still weak, and the Northeast deep processing enterprises fell 10~20 yuan/ton during the May Day period; The mainstream price of Jinzhou Port in Liaoning was 2330 yuan/ton, down 10 yuan/ton; The purchase price of some large-scale acquisition enterprises in Jinzhou Port was lowered from 2,380 yuan/ton to 2,350 yuan/ton, a decrease of 30 yuan/ton; The price of corn in North China fell by 10~20 yuan/ton compared with before the holiday, and the unloaded vehicles of Shandong deep processing enterprises exceeded 1,000 in a single morning; The price of corn in Guangdong port fell by 20~30 yuan/ton, and the spot shipment of corn in the north and south ports was still upside down at about 35 yuan/ton.
However, after the May Day holiday, the domestic corn futures rebound momentum is strong, driving the rebound of spot prices, and some deep processing enterprises in Northeast China began to raise their quotations after the holiday, with an increase of 10~30 yuan/ton; Liaoning Jinzhou port corn prices also rose day after day, as of May 13, the cumulative increase after the holiday was 40 yuan / ton, the mainstream price of 2370 yuan / ton, but the inventory of the northern port continued to accumulate, has exceeded the inventory level of the same period last year, all grain inventory in Guangdong port hit a new high, corn shipments are still difficult, the phased supply is still loose, the market hopes that the futures disk will rise to attract downstream replenishment procurement intentions, thereby driving the spot end of the goods.
Bearish factors have been traded for a long time, boosted by rumors of wheat bullishness
At present, the negative factors in the market are mainly concentrated in the phased supply easing, the expectation of corn in import reserves and the pressure on the market of wheat in the new season, but for these negative factors, the market has been trading for a long time, it is difficult to form a deep fall, and with the consumption of corn surplus grain in the current season, it is expected that the spot price trend of corn in the medium term will fluctuate strongly.
Wheat prices have fallen for a long time due to high expectations of a bumper wheat crop this year, but the suspension of wheat auctions by China Grain Reserves has been positive for the market as the new wheat season approaches. Recently, market rumors said that the storage of wheat will be increased, and the quantity is larger, estimated at the level of tens of millions of tons, according to the previous year's wheat to corn substitution level estimates, after the increase in the new season wheat may be difficult to enter the feed field to replace corn, unless the harvest season again similar to last year's sprout wheat event. Therefore, in the stage of wheat harvest and listing, the policy is expected to be bullish on wheat gradually appearing, which in turn will boost corn price expectations and further support the subsequent strong trend of corn prices.
The cost of corn in the new season has moved down, and the focus is on weather-themed transactions
Spring sowing in Northeast China is underway, and the cost of land rent has dropped significantly this year, which is also within market expectations. This year, the average decline in land rent in Northeast China is about 20%, the price of other seeds, fertilizers and other agricultural materials has changed little and declined slightly, the cost of corn planting in the new year has generally moved downward, and the current market estimates that the cost of the collection port is around 2200 yuan/ton, and the planting cost has moved significantly lower than last year, and the support of the new season corn cost has weakened.
This year, grassroots farmers are not very willing to change corn planting, and the replanting is still dominated by soybean-corn rotation, and the overall planting area in Northeast China has only been slightly reduced, with a reduction of about 3%. Therefore, from the point of view of planting area, it is also relatively unfavorable to the price of corn in the new season, the pressure on the supply side of the output is still there, but the cost and area of the negative has basically become an established fact, the later market focus will be shifted to the sowing of the new season corn and the weather drive of the production period, the current grassroots reflect that the sowing progress is slower than in previous years, but the temporary impact is not large, pay attention to the weather trading theme, easy to appear bullish.
From a fundamental point of view, the pressure on corn supply has gradually eased, the negative theme has been trading for a long time, and the follow-up corn price is expected to run strongly in the range shock, and the uncertainty of policy and weather is more likely to appear, and the US corn has also entered the weather trading stage. And the 2024/2025 annual supply and demand report of U.S. farmers corn ending stocks are less than expected, and they are bullish again, so under the resonance of the internal and external disks, corn prices are still expected to rise in the medium term, but because the import reserve corn has not yet been realized, to the cashing stage, corn prices may still have a pullback trend, but the downward drive has been limited, and the bottom of the annual corn price is relatively solid. (Author: Special Analyst Sun Zhaojun)