Pre-auction of stored corn

On April 9, the bidding sales of imported corn and national temporary storage corn began again. This is the re-launch after the temporary storage corn auction ended in early January this year, more than a month earlier than the launch time of the national policy corn auction last year.

According to the reporter's understanding, the amount of corn planned to be auctioned this time is about 320000 tons, including 43000 tons in Anhui, 144800 tons in Jiangxi, 123900 tons in Hubei and 5800 tons in Hunan. The early auction of stored corn can be said to stir up thousands of waves with one stone.

"up to now, the state has temporarily acquired about 80 million tons of corn produced in 2014 in Northeast China, an increase of about 15 million tons over the same period last year, which has led to a tightening of market supply and a marked rise in corn prices in some areas." Cui Bing, a corn trader in Henan, told Futures Daily that if the temporary corn is not released from the warehouse in time, then the market is likely to see a sharp rise in prices in the short term as in the same period last year, which will put greater cost pressure on downstream demand enterprises. The purpose of temporary storage corn entering the market in advance is to alleviate the tight supply in the market, and also to make the market price run smoothly.

Market participants believe that at present, the temporary storage of corn inventory has been very large, at the same time in the collection and storage policy dominated the market, domestic corn purchase and sales activities have been greatly affected. The early entry of temporary corn into the market will stabilize the market price, and there will be less room for individual purchasers, intermediate traders and demand enterprises to take advantage of price fluctuations for business operations. Under the condition that the supply is fully guaranteed, the main bodies of the market will revolve around the auction of temporary stored corn.

Hebei corn trader Liu Shuwei told reporters that he stopped buying corn after learning that the temporary storage corn had entered the market, mainly because he was worried that the acquired corn would not be sold. It is understood that the temporary corn storage sites are scattered all over the country. In addition to the northeast region, there are also a large number of northeast production and temporary storage corn in other parts of the country, some of which were produced in 2013. Considering that the quality may decline after a long storage time, these corn may be released from the warehouse in large quantities at any time. Once out of the warehouse, the market price will certainly be under pressure and decline.

According to Cui Bing, as the temporary storage of corn regular auction to ensure the supply, many demand enterprises do not store a large number of corn. "some feed enterprises, corn processing enterprises have very little production turnover inventory, the production of raw materials to purchase temporary storage of corn, which makes corn traders dare not act rashly."