Animal Feed Ingredient Market Information In China On January 12, 2024

Feed Ingredient Price List On January 12, 2024

Market Comments and Concern

Corn/Maize

Corn prices adjusted within a narrow range on the 12th. This time, China Grain Reserves publicly released information on increasing reserves, which is a significant boost. It will play a role in stabilizing market sentiment in the short term. It may also drive midstream traders and downstream feed breeding companies to enter the market to replenish stocks, which will help resolve the pressure on surplus grain in production areas. However, follow-up policies The specific implementation situation determines the strength of its beneficial impact. It is predicted that in the second half of January, the probability of some markets abandoning weakness and turning strong will increase moderately. At the same time, due to the uncertainty of weather conditions in January, if extreme weather occurs in production areas during January, affecting corn sales and transportation, then There are opportunities for rising prices of corn in sales areas. Therefore, judging from the daily trading average price trend, the first half of the month was weak and there is an opportunity for a rebound in the second half of the month, while the chance of the monthly average price continuing to fall month-on-month is still very high.

DDGS

DDGS prices weakened partially on the 12th. The domestic terminal market demand is average, and the enthusiasm for downstream procurement is not good. Most of the products are purchased on demand, and there are few large orders. The transaction performance of some enterprises is not ideal. DDGS inventory has accumulated, and some traders have reduced prices for shipments. However, DDGS After the price reduction, the transaction situation improved and the inventory growth slowed down, which supported the price. In January, China's corn ethanol production industry continued to be in the peak production season. Theoretically, the production and supply of DDGS is still high, and the overall supply is still sufficient. On the demand side, aquaculture continues to be in the off-season, and the rigid demand for DDGS will continue to weaken. The price of corn, the superimposed raw material, continues to fall, and the prices of corn and soybean meal, the related raw materials that have a substitution relationship, are generally weak. Therefore, the price trends of both supply and demand as well as related products are negative for the price trend of DDGS. Therefore, we predict that the overall price of DDGS in January will be negative. The chance of still being weak is higher. In the second half of January, due to the impact of moderate stocking before the Spring Festival and the price of corn and protein meal raw materials, there is a possibility of a short-term rebound. Therefore, the average ex-factory transaction price of DDGS in the second half of January is expected to stop falling and there will be opportunities for short-term regional strengthening. However, in January The probability of the monthly average price continuing to fall is still higher.

Soybean Meal

The recent rainfall in Brazil means that the soybean harvest will be better than previously expected, and the good weather in the Argentinian production areas is also expected to have a high probability of a bumper harvest. In addition, after the cost-effective Brazilian soybeans have occupied the U.S. soybean market, the sales and export progress is far behind the same period last year. CBOT soybean futures still closed near their lowest levels since December 2021. Continuous declines in U.S. soybeans have severely dampened buying sentiment and driven down the cost of imported soybeans and consecutive soybean meals, weakening the support for soybean meal prices from the cost side. Domestic soybean meal supply is sufficient and demand is sluggish. In addition, factory transactions are light due to strong bearish sentiment in the market. , under the dual pressure of supply and demand, the spot price has continued to fall and the pattern of weak meal and strong oil remains. Even if the US Department of Agriculture lowers Brazilian soybean production, it will not change the pattern of increased production in South America, and soybean meal prices will continue to be weak and downward.