Corn supply increment and policy game price fluctuation at low levels

The Buenos Aires Grain Exchange reported that as of October 30th, the planting progress of corn in Argentina for 2024/25 reached 34.5%, higher than 28.9% a week ago and an increase of 11.1% compared to the same period last year. The European Commission expects the grain production of the 27 EU countries in 2024/25 to be 255.62 million tons, a year-on-year decrease of 12.6 million tons or 4.7%; The estimated final inventory is 35.15 million tons, a year-on-year decrease of 9.36 million tons or 21%.

The domestic corn market situation is complex. With the advancement of corn harvesting in the United States, production will reach a historic high, and temporary supply pressure will put pressure on the corn market. But the improvement in export demand provides support for prices. The harvest of new season corn in Northeast China has entered the mid to late stage, and the policy based storage scope has expanded, boosting market confidence. Grassroots growers' reluctance to sell at low prices has strengthened, drying towers and traders continue to build warehouses, and the activity of new grain purchase and sales has increased. Deep processing enterprises adjust prices according to demand. However, the harvesting range of corn in the new season has expanded, and the supply is in an incremental state. The demand for feed is limited, and the digestion pace of processing enterprises is slow. The increase in supply limits the upward space of corn prices. Looking at the market, under the game of favorable policies and supply pressure, corn maintains a low volatility.

The market situation of corn starch: In the new season of corn listing, the supply of raw materials is loose, industry profits have improved, the operating rate of the corn starch industry has increased seasonally, output pressure has increased, and inventory has slightly rebounded. As of October 30th, the total starch inventory of corn starch enterprises in China was 824000 tons, an increase of 29000 tons from last week, a weekly increase of 3.65%, and a monthly decrease of 10.07%; The year-on-year growth rate is 34.20%. However, there is currently no significant supply pressure in the market, and the supply and demand fundamentals are good. Looking at the market, due to the decline in corn prices, starch futures prices closed lower today. Focus on the weekly consumption of Mysteel corn on Thursday and Friday, as well as the start-up and inventory situation of starch enterprises, and the collection and storage policies.