Corn Products China News 1602 (12 issues per year)

Mar 09, 2016, 16:37 ET from ReportBuyer

LONDON, March 9, 2016 /PRNewswire/ -- In Feb. 201 6, the compelling No.1 Central Document is issued, pointing out that China would regard the corn planting area reduction and the principle on separating subsidies from the market price as the major development direction of China's corn farming. This indicates that the purchase and storage policy on corn which China implemented for 8 years may come to an end.
After that, the Chinese government is expected to reduce the intervention in corn price. So corn price is very likely to reduce continuously in the future.

At the same time, China's pig farming attracts a lot of investors affected by the high live pig price and the reducing live pigs in farms. New Hope and Beijing Dabeinong announced to invest in building pig farming projects in Feb. after COFCO, Chia Tai Group and Wens, which may speed up the recovery of pig farming, so as to pull up the consumption of corn products for feed processing.
The State Administration of Grain disclosed that China's accumulative purchase volume of 201 5/1 6 temporarily-stored corn reached 83.82 million tonnes, as of 20 Feb., 201 6. Although there are more than two months left before the end of the temporary and purchase period (30 April), the purchase volume of corn has exceeded the total in 201 4/1 5, hitting a record high. Now, the large amount of inventory is still the important factor that reduces the corn price.

After the Spring Festival, the prices of downstream corn products still remain low due to the falling price of corn. The prices of corn starch, HFCS and lysine all reduce to the lowest of recent two years. The low prices enable corn products to find back market advantages - export volume of corn starch rebounds, HFCS replaces cane sugar, corn starch replaces cassava starch and potato starch, China's corn deep-processing industry is embracing a bright future.

The USD/RMB exchange rate in this report is USD1 .00=RMB6.5539 on 1 Feb., 201 6, sourced from the People's Bank of China. All the prices mentioned in this report will include the VAT, unless otherwise specified.
If you would like to cover any specific topics or investigate any covered subjects in more details, please contact us on +86-20- 3761 6606, or econtact@cnchemicals.com.On 27 Jan., 201 6, the Chinese government issued the No.1 Central Document (201 6), clearly showing its determination to reform the temporary storage policy on corn. CCM believed that this reform is possibly oriented towards the practice of continually
reducing the purchase price of the temporarily-stored corn and properly subsidizing the farmers.

On 29 Jan., 201 6, the Chinese government decided to add 1 29 storage facilities for temporarily-stored corn in four northeast provinces. As the purchase volume of temporarily-stored corn goes up, this will support the continually falling market price of corn to some extent.

Recently, Chinese feed enterprises have been entering into pig farming, encouraged by environmental policies and the huge profit margins in selling pigs and pork. Meantime, this may change the market risk and the client area of the corn deep-processing industry in China.

EPPEN Biotech is going to construct the 200,000 t/a MSG project. After the construction, EPPEN Biotech is expected to become the third largest MSG producer in China. Meantime, it is facing huge risks of large fluctuations in MSG price and overcapacity in the industry.

On 6 Feb., 201 6, Ingredion acquired Shandong Huanong. There are two factors contributing to this acquisition - Shandong Huanong's technical expertise & market experience in producing waxy corn starch and China's unclear standpoint on GM crops.

Cassava starch price still remains at the lowest level of resent two years affected by the increasing import volume and the lowpriced substitutes. However, the price is expected to rebound slightly under the influences of weather of producing areas in later period.
Snapped by the extreme cold, China saw reduction in potato output in spring. The short supply of potato is expected to spur up the price of potato starch.
In 201 5, the export volume of MSG reported a large YoY rise in China. Meanwhile, the export shares of the traditional exporters Fufeng Group and Meihua Bio are shrinking. Also, Southeast Asia has become the main export market, and Africa is an emerging market for China's MSG exports.

China's export volume of corn starch made a turn-around in year 201 5 affected by the declined price, inventory pressure and the policy change of export tax rebate.
In year 201 5, the market price of HFCS continued falling due to the declined raw material price and the overcapacity despite the rising demand and high-priced competing product.
Download the full report: https://www.reportbuyer.com/product/3681932/

About Reportbuyer
Reportbuyer is a leading industry intelligence solution that provides all market research reports from top publishers
http://www.reportbuyer.com

For more information:
Sarah Smith
Research Advisor at Reportbuyer.com
Email: query@reportbuyer.com  
Tel: +44 208 816 85 48
Website: www.reportbuyer.com

SOURCE ReportBuyer



RELATED LINKS

http://www.reportbuyer.com