Maize (Corn) Prices Drop Amidst High Inventories and Lackluster Demand

Singapore: Amidst the decline in demand from the end-use sectors, maize (corn) prices are falling everywhere. The prices of the goods have also decreased due to large stockpiles in domestic markets worldwide.

An overall reduction in corn demand on the domestic market helped to lower the price of maize (corn) in China during the first week of August. The price of raw materials kept declining, most downstream trades maintained a cautious wait-and-see stance, and the weather was typically hot and rainy, which supported agriculture. The domestic starch industry was also experiencing excess demand and continued to be busy during the year's busiest season, but there was an excess of starch in storage. Businesses that process maize (corn) starch have reduced ex-factory prices to ensure delivery. The steady downturn in corn demand impacted the domestic corn starch market prices, and overall pressure decreased. Additionally, the corn season's downstream demand is unsuccessful, raw material costs are still cheap, and inventory is expanding. The weak maize (corn) price in August is expected to continue to affect the price of corn starch in China's domestic market.

The price of maize (corn) has recently decreased in Ukraine due to weekend rainfall that aided crop development in the Upper Midwest and moderate temperatures during the first week of August. Furthermore, considering that longer estimates still call for hot, dry weather through mid-August, it helped allay fears about market yield. Corn and wheat prices are also negatively impacted by growing Black Sea transportation costs. As more ships depart Ukraine, corn prices are currently falling.

ChemAnalyst predicts that maize prices will likely continue to fall in the upcoming month due to increased global output and decreased demand.