Demand and supply prospects support, US corn rose slightly

The market of Chicago Futures Exchange (CBOT) corn futures market closed up on the 29th due to supportive supply and demand outlook and spillover from the wheat futures market. CBOT December corn futures closed up 3 cents to close at $5.82 per bushel, and speculative funds are expected to buy 6,000 lots.

Shawn McCambridge, senior grain analyst at Prudential Bache, said that corn futures ended higher on the 29th, but prices were still within the market's recent trading range, as the supply and demand of the corn futures market remained very balanced in the absence of new directional information. Traders began waiting for the next government crop report, which will be announced on November 9. The new report will provide a new round of market trends. There are views that the U.S. Department of Agriculture will further reduce U.S. corn production and production estimates.

However, U.S. corn export demand has been difficult because buyers have slowed corn purchases as prices have risen to a two-year high. Dealers said that the end of the month to help support prices, the wheat futures market for most of the time the strong support of the corn futures market, until the slightest hedging pressure before the US corn weekend limit price increases.

The International Grains Council (IGC) lowered its forecast for global 2010/11 corn production by 10 million tons on Thursday, with the largest reduction in US corn production forecast. In the monthly report, IGC estimates corn production in the world in 2010/11 to be 814 million tons, and that in the United States will be reduced by 11 million tons to 323 million tons, which is due to a decline in the yield forecast. China's 2010/11 safe maize production forecast is also lowered by 3 million tons to 162 million tons, but this will be offset by the improvement in Argentina’s corn production outlook. Global 2009/10 corn production is 811 million tons.

Dalian corn futures weakened on the 29th, with the main contract again dropping and holding positions shrinking. The main 1105 contract closed at 2,190 yuan/ton, down by 8 yuan. The 1109 contract fell 13 points to 2,289 yuan/ton. Dragged down by the surrounding commodities, the market sentiment, coupled with domestic expectations of high yield pressure, the price shocks lower. The technical uptrend of corn was hindered and the market sought support again. Currently, under the weakening of fundamental support, corn prices are still facing downward pressure.

Domestic spot corn prices are firm, purchase and sales activities in the production areas are normal, and there are no cities in some regions. The weather in Dezhou, Shandong Province continued to be fine, and new corn production was stable. At present, the price of trader-purchased net grain (moisture 15-16) is 1,960 yuan/ton, up by 20 yuan/ton, and the outbound cost is around 2010. It is reported that, due to the expected impact of rising market for new crops, Hebei purchase prices of corn deep processing companies also showed a rising trend. At present, Hebei Changli Starch Factory corn purchase price has risen to 1.00 yuan/kg.