Sure enough, it fell again! Can there be a "turnaround" for corn in April? Everyone is looking forward to the answer
We have just said that this round of rising corn prices in Shandong and North China is not real, and the steps are not solid, so it is easy to turn around and fall at any time.
As expected, the price fell as soon as I finished speaking.
If the supply volume decreases and the price rises due to the weather, then as the weather improves, the supply volume increases and the price will naturally fall back.
The fall in Shandong corn has had two effects:
One is that it once again aggravated the bearish sentiment in the corn market.
After wheat fell, corn also weakened, and the market sentiment suddenly changed from bullish after the purchase and sale came to an end to bearish. Although wheat has stabilized and corrected recently, and the market sentiment has been slightly stable, the overall sentiment is still bearish. At this time, Shandong North China fell again, and some even fell several times a day, once again exacerbating the market's pessimism.
The other is that the price difference has narrowed, the Northeast corn has not been able to enter customs smoothly, and the supply pressure has increased.
Compared with Shandong and North China, the pressure on corn in Northeast China is relatively high. It is originally a major production area, but the local digestion capacity is insufficient. It usually relies on external transfer, flow into sales areas or purchasing and storage to relieve supply pressure.
However, demand in the current sales area is weak, purchasing intention is insufficient, and consumption is slow. Previously, the price of corn in North China rose in Shandong and fell in the Northeast. The price difference gradually widened, making it possible for Northeast corn to enter the customs. However, after the correction in Shandong this time, the price difference has narrowed, and it is expected that the entry of Northeastern corn will still be difficult.
Then, the market at this time can only wait for policy guidance.
However, this correction in Shandong is completely expected, and we also mentioned in yesterday’s article that the current corn market has both good and bad news. Under the mutual influence of these news, There is a high probability that corn will enter a "tug of war" again.
However, the market is more concerned about whether corn will have a chance to rise again in April?
From a supply and demand perspective, the demand gap for corn still exists, but with the sharp fall in wheat prices, the previous rhythm of corn has been disrupted, and it is faced with re-finding a balance. However, a relatively negative impact is that market pessimism increases, traders' willingness to build warehouses decreases, and their willingness to ship increases, which increases market supply.
On the other hand, the arrival period of imported corn at the port is about 40-50 days, which means that the impact on arrival in April is probably the import in February.
According to data from the General Administration of Customs, in February this year, the total corn import volume was 3.09 million tons, a year-on-year increase of 60.1%. This puts great pressure on the market.
On the demand side, the price of pigs is hardly positive in the first half of the month. The situation of strong supply and weak demand has even increased, and there is a risk of falling below the "7", but the chance of a sharp drop is not high.
As for deep processing, recovery is still slow. However, we have also noticed recently that corrugated paper prices have experienced continuous corrections or may see a slight recovery. The recent surge in white sugar prices has caused quite a stir in the market, and has also paved the way for the replacement of starch sugar.
So from the overall general trend, it is mixed, and corn is struggling to move forward. But we have also said before that in addition to the general trend, you can also pay attention to three small market changes in the short term:
The first is the inventory of downstream companies.
Deep processing generally suffers losses, the operating rate drops, and the inventory consumption is also slow. The inventory is mostly around 20-35 days, and the procurement is mostly maintained to replenish the inventory.
The inventory of feed companies is mostly around 30-35 days. Although it has exceeded the safety stock level, most people are waiting and watching after the early wheat crash, and the amount flowing into feed is not large, so it is expected to start replenishment by the end of the month. Library window.
The second is the mentality of the food holder.
The current corn market is intertwined with bulls and bears. After wheat stabilized, the market sentiment for corn has also recovered, but it is still in a state of consolidation. It is expected that as the market gradually returns to stability, supply and demand will compete again.
The third is policy guidance.
There has been constant news about increasing reserves in Northeast China recently. If it is indeed started, it will be a strong support for corn.
Looking at it this way, the trend in the first half of the month is mediocre, and it is difficult to have much benefit. However, if the replenishment window opens around the end of the month, coupled with the recovery of market mentality and favorable policies, corn is expected to stabilize slightly. callback.