At the beginning of the year, both corn and pigs made a "good start" and both rose to new highs. In March, with the tide grain coming on the market, corn prices began to fall. Since then, it has been slowly falling. Although it has experienced several rises in the middle, most of them are staged, and the overall trend is still downward.
At present, new corn is on the market, but the market is uncertain. On the one hand, the price of corn was high at the beginning of the year, on the other hand, the price of corn fell continuously during the year. How will the new corn market go? No one can say for sure. Moreover, not only the domestic changes, but also the turmoil in the international corn market.
First, the price differentiation of corn has further widened.
As we said before, some corn in Huanghuai area of North China was damaged, resulting in a double decline in quality and yield. Coupled with the high planting cost this year, farmers are reluctant to sell, resulting in less food sources on the market, and even less high-quality food sources. Enterprises have to raise prices to buy. On the other hand, corn in Northeast China is still in a downward trend. On the one hand, the output of corn in Northeast China has increased, and the market is not short of grain. On the other hand, the high freight price leads to poor circulation, so there is no state of "grabbing food". But if the price of corn in North China continues to rise, it will be transmitted to Northeast China sooner or later. At that time, northeast enterprises will have to raise prices in order to lock in grain.
But as I said before, it is still too early to judge, because the concentration of corn will not arrive in the future, and the market is still likely to change. The current market is mainly caused by farmers' reluctance to sell and traders' wait-and-see mood, so the domestic market is still an "equal" word, but on the other hand, the changes in international corn are worthy of attention.
Second, US corn revenue may plummet by 40%.
The high global coal and natural gas prices this year have also led to the soaring global fertilizer prices. At the beginning of the month, the price of urea futures in the United States rose by 200% compared with last year, which also made the cost of corn planting in the United States high. In particular, the price of anhydrous ammonia required for corn planting in the United States soared, which directly raised the planting cost. According to the prediction of American experts, according to this trend, the income of American corn producers will drop to $430/mu next year, while this year's income is about $600/mu, which means that the high cost of chemical fertilizer will make the income of planting corn plummet by 40%.
Therefore, in this case, farmers' willingness to plant corn is greatly reduced, and they are likely to turn to planting soybeans and wheat. Therefore, the corn supply will face a sharp decline next year, while the soybean supply may increase substantially, which will have an important impact on the corn and soybean market next year.
Third, the long-term trend of corn.
At this time, let's look at the long-term trend of corn. Although the current domestic trend is still unclear, in the long run, the author believes that the trend of corn will not be too bad.
The first reason is that although the rising price of corn will lead to the pressure of feed enterprises, aquaculture and deep processing, the root cause is not corn itself, because corn is also very difficult. With the skyrocketing prices of chemical fertilizers and agricultural materials, the planting cost of corn has also risen, so how far can corn fall sharply?
On the other hand, food security is the most important. Although grain is also an important raw material for processing, rising food prices will affect processing profits, but the income of processing enterprises is income, isn't the income of farmers income? Therefore, the policy has repeatedly clearly emphasized the need to protect the reasonable income of grain farmers, whose income is the bottom line.
The third reason is that the corn gap still exists. Although the substitution of corn will still exist in order to stabilize the soaring cost caused by the rising corn price, with the decline of global corn planting willingness (not only in the United States, Canada, Europe and other countries), the supply of corn will be greatly reduced next year. Therefore, in the case of tight international corn supply, it is difficult for corn to plummet, which has also become an important support for corn prices.