In May 2015, China's market price of corn declines
from the high and the market prices of corn products also record declines in
general. In detail, the soaring import volume of DDGS pulls down the market
price; corn starch price slightly drops in May after three months' rises; the
price of corn gluten meal decreases by 6.4% month on month. Additionally, some
products achieve rises in prices, such as furfural and MSG. The market price of
furfural is pulled up by the increasing operating rates of downstream furfuryl
alcohol enterprises; and the MSG price soars to USD65.4/t-USD98.1 /t. Although
corn price declines in May, it still remains at high level.
For the company dynamics, cooperation and merger
among large enterprises increase. Meihua Bio develops bacteriophage project,
which will become the new profit growth point of the company; Bright Food
acquires Liangyou Group to become the largest grain & oil supplier in East
China; COFCO joins hands with CIC to establish COFCO International Holdings,
planning to make its assets of grain, oil and sugar listed within five years.
In Q1 2015, China imported 2.27 million tonnes of
sorghum, soaring by 352% year on year. Along with the significantly increasing
import volume of sorghum (substitute for corn) and the temporarily-stored wheat
being put onto the market, the cost performance of corn is reducing. However,
supported by the temporary storage policy for corn, CCM believes that con price
is unlikely to drop in ashort term.
The USDC canceled the anti-dumping duty levied on
xanthan gum which Meihua Bio exported to the US, widening the difference of
anti-dumping duties between China's xanthan gum enterprises. CCM believes that
this may boost the internal cooperation of enterprises.
Affected by the reducing operating rate,
supply-demand balance in China's corn starch industry was improved. In terms of
continues rising corn starch price, corn starch enterprises may achieve
turn-around in performance.
The import volume of corn will increase in China, due
to the lower price of imported corn and the poor quality of domestic corn.
China's price of DDGS slumped in April 2015, affected
by the shrinking demand from livestock industry and the increasing import
volume of DDGS. Besides, the high corn price led to serious losses of DDGS
manufacturers, and part of them even suspended production.
Meihua Bio takes advantage of its existing resources
to develop the bacteriophage formulation project, which not only enriches the
production line of the company, but also becomes a new profit growth point in
its bio-pharmaceutical business.
COFCO joined hands with CIC to establish COFCO
International Holdings, planning to make its assets of grain, oil and sugar
listed within 5 years. At that time, the pattern of global grain & oil
market will change. Nevertheless, COFCO has a complex internal asset structure,
and heavy workload of asset adjustment will be involved before the listing,
which increase the difficulty of listing.
Due to the weakening demand from the downstream livestock
industry, the demand for wheat is suppressed. At the same time, the auction of
temporarily-stored corn will increase the market turnover of corn. Also,
deep-processing enterprises in some regions are taking advantage of subsidies
to boost their purchases of temporarily-stored corn. These factors will
suppress the corn price. Therefore, even the temporarily-stored wheat is put on
the market, wheat will not be a viable substitute for corn because it will
remain more expensive than corn.
Stimulated by the rising demand for MSG in Southeast
Asia, China's export volume of MSG recorded rise in March 201 5. As the China's
exported MSG is mainly produced by Meihua Bio and Fufeng Group, the dynamics of
these two companies exert a great influence on MSG price.
In Q1 201 5, sorghum recorded large rise in import
volume in China, mainly due to the increasing price of China's
temporarily-stored corn.
In May 201 5, China's market price of furfural
rebounds, because the increasing operating rates form downstream furfuryl
alcohol enterprises stimulate the demand. Nevertheless, affected by the rising
price of corn cob and the environmental protection problems, the development of
furfural enterprises is still restricted.
Report
Covered:
- USDC cancels anti-dumping duty on Meihua Bio’s xanthan gum
- China’s corn starch enterprises expected to turn loss into gain in 2015
- Low price of imported corn may boost import volume in China
- China’s DDGS price hits record low in April since 2014
- Meihua Bio utilizes existing resources to develop bio-pharmaceutical business
- COFCO: assets of grain, oil and sugar to go listed within 5 years
- Wheat: unattractive as feed substitute for corn
- Chinese corn products Imp. & Exp., March 2015
- China’s export volume of MSG records increase in Q1 2015
- Import volume of sorghum soars in China, Q1 2015
- Price update of corn products, May 2015
- Furfural: price rebounds due to increasing operating rates of downstream enterprises
- COFCO Biochemical plans to establish 1 million t/a corn ethanol project
- CNGOIC: corn output expected to reach 232 million tonnes in China in 2015
- Bright Food acquires Liangyou Group to grasp grain & oil market
- Fuel ethanol gets benefit from Work Plan on Accelerating Quality Upgrading of Refined Oil
- Guangzhou Shuangqiao: first-phase project of 500,000 t/a starch sugar successfully put into trail production
- EPPEN Biotech: 80,000 t/a lysine technical reformation demonstration project under EIA publicity
- India to officially levy anti-dumping duty on China’s sodium citrate
- Sun Paper to put xylitol project into large-scale production in Q3 2015
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