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New Crop Corn And Bean Prices Gain

China auctions rice for feed

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China Auctions Rice For Feed

  • China auctioned 2 million tonnes of rice from government reserves directly to feed makers last week.
  • 70% of the total volume was purchased with manufactures taking between 1.4 million and 1.5 million tonnes of rice.
  • Corn prices hit record highs in China in mid-January as decreasing stocks and reduced output raised concerns over supplies.
  • The base price for the rice auctioned was 1,500 yuan ($228.62) per tonne, lower than current corn prices between 2,700 and 3,200 yuan per tonne.
  • There will be more such auctions coming as the government plans to release rice and wheat until corn prices are subdued.
  • So far this year the government has been auctioning about 4 million tonnes of wheat and 1.6 million tonnes of rice a week from reserves.
  • China's rice, and wheat inventories are both at historically high levels and can meet more than one year's consumption.

FBN’s Take On What It Means For The Farmer: After hitting record highs in January China's corn futures prices have declined 11%, subdued by imports of feed grains and feed producers switching to wheat and rice. Feed makers bought large quantities of feed grains and built up high inventories as prices advanced. Recent African swine fever outbreaks have also kept demand in check. The current decline has brought domestic prices closer in line with import values, but China will continue to import corn if prices don’t remain stable.

FBN

Argentina Weekly Crop Progress Update as of March 30

  • Soybean conditions improved one point in the good to excellent rating, coming in at 8%; that still is well below the average at 29%.
  • The percent rated poor to very poor also gained a point, coming in at 33%.
  • The crop is 43% mature and running behind average progress; harvest has not yet started but on average, about 10% has been collected by late March.
  • Corn conditions improved for the week with the percent rated good to excellent at 27%, which is nearly in line with the average at 31%.
  • Like beans though, corn conditions have been well below the average for most of the growing season.
  • Corn progress is also behind average, as only 8% of the corn crop had been cut versus the average around 19%, as of late March.

FBN’s Take On What It Means For The Farmer: Weather has not cooperated for Argentina this growing season and the near term forecast will not provide relief, though there is rain slated for next week. However, crops are approaching the point of maturity where moisture may offer only marginal additional benefit.

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