Corn is still plummeting, but it is actually waiting for "take-off"!

It's a sunny day, and the corn has been falling endlessly.

However, the new agricultural concept holds that the current decline of corn is more affected by emotions than weak demand.

Because the weak demand for corn is not a day or two, there is no reason to react suddenly now.

With the continuous decline and continuous rainfall, it is more difficult to preserve some dry food, and traders are eager to sell it, while enterprises take the opportunity to lower prices, causing a temporary panic.

But if you calm down and think about it carefully, corn is actually waiting for "take off".

Why do you say that?

We have mentioned the planting cost of corn more than once, but many people think that the fluctuation of grain price changes with the change of market supply and demand, and the planting cost is not considered at all when the market supply and demand changes.

This is true, but it is only half right, because the second half of this sentence is "the market is the mainstay, supplemented by policies". The market can ignore it, but the policy will not ignore it.

However, in some cases, this policy will not be considered.

What happened?

It is when the gap between supply and demand is large.

For example, the price of pigs hovered below the cost line most of the time last year. Even after falling below the cost of farming, there is not much policy intervention. Why? Because of the overcapacity of pigs, the supply exceeds demand. In this case, we can only rely on the spontaneous capacity reduction of the market to restore balance.

Then let's look at corn again. Obviously, the supply and demand of corn is not like this, and even the price-performance ratio of corn demand is returning.

Whether corn can "take off" depends on demand.

Needless to say, the demand for deep processing has not changed much, and most of them are repeated between replenishment and elimination, so the impact on corn is relatively limited.

The bulk of feed demand is corn, which has a vital impact on corn, but several "competitors" of corn are weak this year.

First, let's look at wheat. On the one hand, the price of wheat has gone up, which greatly reduces the possibility of replacing corn. In addition, the policy intention is clear-rations are not needed, so the threat of wheat is basically lifted.

Followed by directional rice, directional rice was once considered as the "strong enemy" of corn by the market, but its momentum is also declining recently.

As of August 1 1, directional rice has been auctioned 18 times this year, with a cumulative investment of 30.57 million tons and a turnover of 23.27 million tons, with a turnover rate of 76. 1%.

In mid-June this year, rice was auctioned for the first time, and then the transaction volume gradually declined.

On August 4, there was another auction, and on August 1 1, all the auctions were auctioned.

Before, we also analyzed the reasons for the flow shooting, mainly the cost performance problem.

Theoretically, there is a certain price difference between rice and corn, but the enterprise considers the comprehensive cost of rice price plus transportation cost plus transportation time. When the price of corn rises, the advantage of this comprehensive cost still exists, but when the price of corn falls, this advantage is greatly reduced, and the price-performance ratio of corn is returning.

Thirdly, with regard to imported corn, although the international food price has been falling across the board since June, which has basically retreated all the increase since the conflict between Russia and Ukraine, the recent heat wave and weather speculation in the northern hemisphere have once again pushed corn to the forefront, at least supporting the price of imported corn.

The difficult price reduction means that the advantages of imported corn will not be too obvious.

At this time, domestic corn is secretly accumulating strength, waiting for "two opportunities."

The first is demand pull.

The arrival of the peak season of pork consumption in the second half of the year has driven up the price of pigs, thus driving up the demand for feed.

Although the probability of consumption in the second half of the year will be less than expected, the trend of rising pig prices still exists, which means that the growth of feed demand still exists, so corn is waiting for demand.

The second is the harvest situation.

There are many droughts in the south and heavy rains in the north this year, which adds a lot of uncertainty to the growth of corn.

No matter the quality or yield, any change may affect the trend of corn.

Therefore, although the current corn continues to plummet, it has basically reached the point of falling. Under the premise of "ensuring the reasonable income of grain farmers", the bottom support of corn is still obvious.

But when we say "take off", we don't mean that corn will soar, but that it will rebound from the bottom. As for how high you can bounce and how far you can fly, it depends on the subsequent changes in corn harvest and aquaculture demand.

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