Global feed market: feeds fluctuate differently, and China's corn imports are expected to be lowered

 

On Friday, the Chicago Board of Trade (CBOT) December 2021 corn futures fell by about 11 cents or 2% from a week ago, to close at 530.
50 cents/po
.
The spot price of Meiwan No.
2 yellow corn was 605.
5 cents per bus, down 19 cents or 3% from a week ago
.
The EURONEXT exchange's November 2021 corn futures closed at approximately 250 Euros/ton, up 13.
5 Euros or 5.
7% from a week ago
.
The FOB spot price of Argentine corn in Shanghe was US$247/ton, the same as a week ago
.
The January corn futures settlement price on the Dalian Commodity Exchange closed at 2,489 yuan/ton, down 8 yuan or 0.
3% from a week ago
.

 

International crude oil futures rose this week, as global energy supply and demand are tight, and high natural gas prices may prompt large power users to switch to crude oil, pushing U.
S.
crude oil prices to a seven-year high
.
On Friday, the New York Mercantile Exchange (NYMEX) West Texas Intermediate Crude Oil (WTI) November contract closed at 79.
35 yuan per barrel, the highest closing price since October 31, 2014, an increase of 4.
6 from a week ago %, also rose for seven consecutive weeks
.
The global benchmark December Brent crude oil futures closed at US$92.
39 per barrel, up 3.
9% from a week ago, and also rising for four consecutive weeks
.

 

On Friday, the US dollar index closed at 94.
10 points, up 0.
1% from a week ago
.

 

　　The corn harvest in the United States is progressing smoothly.
The weather will be favorable for the harvest next week, but the pace of farmers' sales is slow

 

　　The US Department of Agriculture's weekly crop progress report showed that as of Sunday, the US corn harvest was 29% complete, which was 22% higher than the five-year average, which was in line with market expectations
.
About 88% of corn crops are currently fully mature
.
The warm and dry weather in the U.
S.
corn belt over the past week has helped to mature corn and soybeans, and the temperature in eastern South Dakota and southwestern Minnesota reached 27 degrees Celsius on Friday
.
But there will be sporadic rainfall east of the Mississippi Valley, which may cause a slight delay in harvest
.

 

　　Despite the rapid progress in the harvest, American farmers currently sell fewer new corn
.
Farmers focus on farmland operations and are not in a hurry to sell corn
.
This helps the US Midwest’s corn spot basis to be higher than normal.
This week’s basis is an average of 12 cents lower than Chicago’s December corn futures, compared to an average of 19 cents lower than the average of 19 cents a week ago and the same period last year.
27 cents lower
.
It is not only American farmers who are reluctant to sell, but also Ukrainian corn growers, who would rather wait for corn prices to rebound before selling
.

 

　　The reopening of US Gulf export facilities will help speed up export sales and shipments

 

　　Since Hurricane Ida caused the suspension of U.
S.
Gulf export facilities at the end of August, most of the export facilities have resumed operations, which has helped boost the pace of U.
S.
export sales and shipments
.
The US Department of Agriculture’s weekly export sales report shows that in the week ending September 30, the US’s 2021/22 net corn sales reached 1.
265 million tons, far exceeding market expectations and higher than the 370,000 tons a week ago
.
In the first month of 2021/22, the total US corn export sales (including unshipped sales contracts) totaled 26.
58 million tons, an increase of 2.
8% year-on-year
.
The actual US corn export last week was 974,000 tons, 44% higher than a week ago, but the export volume in the first month of this year was 2.
496 million tons, a year-on-year decrease of 32%.
This was mainly related to the closure of US Gulf export facilities caused by Hurricane Ida
.

 

　　Brazil's corn production will increase by one-third year-on-year next year

 

　　According to the Brazilian National Commodity Supply Company (CONAB), Brazil’s total corn production in 2020/22 is expected to reach a record 1631.
3 million tons, an increase of 33.
7% from the 86.
998 million tons in 2020/21 that was drastically reduced due to drought
.
Yield per unit area is expected to increase by 27.
7% to 5.
575 tons per hectare, and corn planting area will increase by 4.
7% to 20.
865 million hectares
.
However, CONAB also warned that the outlook for corn production depends mainly on the weather
.
The recurrence of the La Niña phenomenon may lead to a decline in yield potential
.

 

　　Brazil sowns three seasons of corn a year.
The first season of corn is currently being sown.
As of October 2, the planting progress reached 24.
2%, which was higher than the 20.
6% in the same period last year
.
The first season of corn will be harvested from February to May next year
.
After the soybeans are harvested from February to March next year, the second-season corn will be sown, and the output will account for about three-quarters of the total corn output
.
The harvest will be on the market from June to July .
The third season of maize is sown from April to June in the northern and northeastern regions of Brazil, covering an area of ​​approximately 1.
4 million acres
.

 

　　Brazil’s corn export volume in September was 2.
855 million tons, a decrease of 55% year-on-year, mainly due to the reduction in the second-season corn production
.
Brazil's corn imports in September increased by 176.
5% year-on-year
.

 

　　Argentine corn export sales will hit a record high in September

 

　　The Argentine government has suspended the issuance of new corn export licenses, and the current corn sales volume has reached 38.
6 million tons, while the US Department of Agriculture forecasts that Argentina’s corn export volume in 2021/22 will be 37.
5 million tons
.
The Argentine Exporters Association stated that corn export earnings in September will hit a record high
.
The Buenos Aires Grain Exchange said that 16.
5% of the corn planting has been completed
.

 

　　U.
S.
Agricultural Counsellor lowers China's corn import forecast for next year

 

　　The U.
S.
Department of Agriculture's Agricultural Counselor in Beijing issued a report stating that the U.
S.
Agricultural Counselor expects that China's corn imports in 2021/22 will be 20 million tons, which is 6 million tons lower than the official estimate of the U.
S.
Department of Agriculture and 10 million tons less than the previous year
.
In the coming year, China's domestic corn prices are expected to fall, the replenishment scale will slow down, and demand will also weaken
.
Chinese buyers may not buy large amounts of US corn in the future, because domestic corn is about to be harvested, feed demand is weakening, local prices have fallen to the lowest point since the end of 2020, and ports are congested
.
Based on current US corn prices, China may switch to Ukrainian corn in the 2021/22 season
.
The price of Ukrainian corn for the new season is less than US$338.
5 (2200 yuan) per ton
.
The after-tax price of US corn shipped to Guangdong ports in September was US$385 (2,503 yuan) per ton, down by US$2.
2 from a week ago, and US$44.
1 (287 yuan) lower than the domestic price of corn
.
The U.
S.
Agricultural Counselor also predicts that China’s corn production in 2021/22 will be 272 million tons, which is 1 million tons lower than the official forecast by the U.
S.
Department of Agriculture
.

 

　　Rainy weather in China's corn-producing areas affects harvest and quality

 

　　This week, heavy rainfall occurred in the corn-producing areas in northern China, which delayed the corn harvest and caused concerns about the quality of the crop
.
Rain not only affects field operations, but also prevents farmers from drying the corn that has just been harvested
.
In production areas such as Shandong, Hebei, Shanxi, Henan and Liaoning, the corn harvest time has been delayed
.
In addition, the shortage of domestic coal supply has led to China's recent restrictions on industrial electricity use, which may affect the batch drying of newly harvested corn in the coming weeks
.

 

　　China’s corn planting area has increased this year because record prices will help increase planting profitability.
Analysts expect production to increase by at least 6 percentage points over 2020, and imports will also decrease accordingly
.
Since the harvest in Jilin and Heilongjiang, the two largest corn-producing regions, will not fully start until November, analysts still need time to assess whether crop yield prospects are severely affected by the rainfall
.

 

　　The U.
S.
Department of Agriculture will release a supply and demand report next Tuesday

 

　　Next Tuesday, the U.
S.
Department of Agriculture will release the October supply and demand report
.
On average, analysts expect US corn production to be 14.
973 billion bucks this year, which is lower than the government’s 14.
996 billion bucks
.
However, the forecast of IHS Markit is higher, reaching 15.
085 billion po
.