What "bottom"?
First, there is little probability that corn will turn from weak to strong in the short term, which means that corn will still fluctuate weakly with a high probability.
Moreover, according to the domestic corn supply and demand report in August, there is little change. The sown area is estimated to be 42,524 thousand hectares, with a yield of 64 10 kg/hectare and a yield of 272.56 million tons.
Second, we have said many times before that although corn is falling, there is not much room for further plunge.
On the one hand, with the higher price of wheat, the withdrawal of substitution and the flow of rice, the demand for corn is returning; On the other hand, as the bottom support of corn, the planting cost also makes it difficult for corn prices to fall sharply.
The recent trend of corn does not seem to have changed much, but it does not mean that the market is static. Just when the corn was weak and volatile, there were "two gusts" in the market.
The first is the recent rebound in international corn prices.
On August 12, corn futures rose by more than 5%, the highest increase in four weeks, because both the United States and Europe lowered their corn production expectations.
In the August supply and demand report released by the US Department of Agriculture last week, the corn yield per unit area was lowered to 175.4 pu/ acre, which was lower than the previous market forecast of 177 pu/ acre, and the yield was slightly lower.
The main reason is that due to the influence of dry weather, the growth of corn in some States is less than expected, thus reducing the yield and yield of corn.
Europe also lowered its corn production forecast.
As we all know, the situation in Europe is more severe. On the one hand, there is an extreme shortage of energy and various costs soar. On the other hand, Europe is suffering from a once-in-a-century high temperature and drought, which is threatening its grain output. In particular, France, Romania and other major corn producing countries have lowered their production expectations, which has caused the corn production in Europe to fall again and again.
As we said before, the corn production in the northern hemisphere accounts for about 80% of the global corn production, so the fluctuation of corn in the northern hemisphere is very important to the global corn trend, and the two major producing areas in the United States and Europe have released the signal of corn production reduction, which makes the international corn nervous again.
The second gust is affected by the domestic weather, and the corn yield in Northeast China is full of uncertainty.
Since June, there has been rain in Northeast China, and it has been raining again and again in July and August, and farmland in some areas has been seriously waterlogged.
At present, it is known that the main affected areas are northern Liaoning and south-central Jilin, and the corn yield is reduced by about 10%~30%, which greatly delays the listing.
But at present, the low-lying areas are mainly affected, and the plain areas are not affected. In addition, there may be signs of bumper harvest in some areas, and whether the two can offset each other can only be verified by the market. This is unpredictable and unpredictable.
So, what impact will these "two gusts" have on the corn market?
Impact 1: Speculation in the international market has increased, which has promoted American corn exports.
There has always been a gap between supply and demand of corn in China, and imported corn is an important market supplement besides wheat and rice. But for a long time, the source of imported corn in China is relatively single, mainly from Ukraine and the United States.
Since the outbreak of the Russian-Ukrainian conflict, Ukrainian ports have been closed, leaving only the United States as the source.
In the first half of the year, due to the soaring international food prices, the price of imported corn was once upside down with that of domestic corn, so the import volume in the first half of the year decreased year-on-year.
In order to increase the source of imports, China has signed relevant agreements with Brazil to speed up the export of Brazilian corn to China, but it will be the end of the year at the earliest after completing various procedures and formalities, which means that the main source of corn imported by China in the second half of the year is still American corn.
In the face of Brazil's upcoming export of corn to China, the United States will naturally not sit idly by and watch the corn market share be seized by Brazil. Before this, it is bound to increase speculation and increase corn production reduction expectations to speed up corn exports, so I am afraid there will be some fluctuations in the international corn market.
Impact 2: The domestic corn production has a great disturbance to the mood.
Although the final yield of northeast corn is uncertain, one thing is certain, that is, although Liaoning corn accounts for a limited proportion in northeast corn, its influence is not small.
Usually, Liaoning corn is the first to be listed, and it is the "vanguard" of corn in Northeast China. However, the late arrival of this "Depth Charge" will inevitably affect the overall listing progress of corn, further aggravate the reluctance of grassroots entities to sell, and then disrupt the listing of corn in the new season.
As for whether it can reverse the decline of corn? It depends on the final harvest and the quality of corn.
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