Foreign media news on February 28:As of the week of February 26, 2021, prices in the global food market continue to rise to adjust demand and attract farmers to increase the scale of corn planting for the next season. The slow progress of second-season corn planting in South America is also supportive to prices. However, US corn export sales were lower than expected, restricting price increases.
On Friday, the Chicago Board of Trade (CBOT) May 2021 corn futures rose approximately 5.75 cents from a week ago to close at 547.50 cents per bushel. Meiwan No. 2 yellow corn was quoted at 631 cents per po, up 12,075 cents from a week ago. The corn futures for delivery in June 2021 on the EURONEXT exchange reported about 220 euros/ton, an increase of 1.75 euros from a week ago. The spot price of Argentine corn in Shanghe was US$244/ton, down US$4 from a week ago, FOB price. The Dalian Commodity Exchange’s May corn futures closed at 2,800 yuan/ton, down 15 yuan from a week ago.
International crude oil futures rose this week. On Friday, the New York Mercantile Exchange (NYMEX) April 2021 WTI light crude oil contract was quoted at $61.50 per barrel, up 3.67%from a week ago. The global benchmark Brent May crude oil futures closed at $64.42 per barrel, up 3.78%from a week ago.
On Friday, the US dollar index closed at 90.93 points, up 0.7%from a week ago.
The feed market oscillated up this week and continued to be driven by the bullish fundamentals. The supply of corn in the United States is tightening, and with the recent extreme cold weather in many parts of the world, the demand for feed in the breeding industry has tended to increase, which means that the demand for corn, soybean meal, and wheat and other diets has increased, thereby exacerbating supply tensions. The corn market still needs to adjust demand through price increases, and at the same time attract farmers to increase the scale of corn planting for the next season.
High prices may start to curb export demand
Over the past week, Chicago corn futures have retreated from recent gains, and the bulls seem to be holding back because there are signs that high prices may begin to curb demand. Chicago corn futures fell back on Thursday and Friday because US weekly export sales were far below analyst expectations.
For the week ended February 18, the US 2020/21 net corn sales of corn was 453,300 tons, a new annual low, which was 55%lower than last week and 85%lower than the four-week average. So far this year, US corn export sales have reached 59 million tons, an increase of 128.1%year-on-year.
South American corn planting progress is slow, which may affect yield expectations
Brazil’s second-season corn planting progress is still slow. The rainy weather has slowed the soybean harvest and also affected the second season corn planting. As of February 18, Brazil’s 2020/21 second season corn planting progress was only 20%, 31%lower than the same period last year. Consider that the ideal planting window will end this weekend, which means that 60%or more of the second-season corn will be planted after the end of the window period, increasing the risk of damage to the yield potential of corn. According to IMEA, Mato Grosso State Agricultural Research Institute, the state’s corn planting progress is 79%behind the same period last year. However, considering the high price of corn, farmers will still find ways to sow all the second-season corn they want to sow, even after the optimal sowing period. The Brazilian National Commodity Supply Company (CONAB) also raised its corn planting area forecast, but lowered its corn yield forecast. Analysts expect Brazil’s corn production to be 108.2 million tons in 2021, up from 102.5 million tons the previous year. The U.S. Department of Agriculture estimates it is 109 million tons.
In Argentina, recent rains have helped reduce the yield loss of corn crops, but the moisture level at the end of crop growth is very critical. In addition, industry sources predict that Argentina will export 1.5 million tons of barley to China in 2021 because China imposes a high 80.5%anti-dumping and countervailing duty on Australian barley.
China’s corn planting area is expected to increase
The Ministry of Agriculture of China predicts that by the end of June, the number of pigs in China will return to a normal level, and by the end of 2021, the number of pigs slaughtered will return to normal. This means that the prospects for feed demand are strong. The Chinese government predicts that China’s corn planting area will increase by 667,000 hectares or 1.6%in 2021.
The forecast values of corn production in the EU and South Africa are raised
The European Commission on Thursday raised its forecast for corn production in the EU-27 by 2 million tons. The South African Production Estimation Committee (CEC) predicts that South Africa’s corn production in 2020/21 will increase by 10%year-on-year due to good weather. Corn production is expected to be 15.8 million tons, higher than 15.3 million tons in the previous year.
Ukraine corn exports accelerate, India exports corn to China
In January, Ukraine’s corn exports were 1.99 million tons, but traders expect that exports in February will return to 2.8 million tons and in March it will reach 2.85 million tons.
In India, with the recent decline in domestic corn prices, India has accelerated corn exports. There are reports that Indian traders have signed contracts to export about 50,000 tons of corn to China. The corn will be exported from Visakhapatnam, the capital of Andhra Pradesh, at a FOB price of US$200-210 per ton, down from US$240-250 in the same period last year. The Agriculture and Processed Food Export Development Authority of India said that from April to November, India exported 14,200 tons of corn, up from 221,675 tons in the same period last year.