China expects domestic corn prices to remain mostly stable as both the government and state-owned grain companies start to stockpile corn following a bumper harvest, the State Grain Administration said on Friday. The administration did not give any details about 0what prices or volume for the government purchases.
Such stockpiling is routine every year because the government sets aside part of its harvests to prevent big price swings for its farmers. Sinograin, which manages state reserves, failed to source enough from farmers last year, prompting the agency to force some processors to stop buying and later buy US corn to help refill state reserves.
The stockpiling from domestic farmers may briefly halt an overseas shopping spree for corn by Sinograin, although it still will need to import next year, traders said. "New corn prices would slightly fall when a large volumes reach the market, but prices would remain basically stable," the administration said in a report after a national corn conference. The administration said the country reaped a bumper corn harvest, but did not give any details. China's National Gain and oils Information estimated the country's harvest at a record 185 million tonnes, up 4 percent from last year.