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A Comprehensive Insight into the Chinese Corn Starch Market in November

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Publish time: 22nd November, 2024      Source: CCM
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Summary：In November, the Chinese corn starch market saw diverse changes. Spot prices in North China were weak, Northeast stable; futures fluctuated and inventories rose. Upstream, with sufficient corn production, enterprise procurement was affected by narrowed profits and price swings. Downstream, food demand dropped after Double Eleven, paper had early growth and late dip, textile and pharma were stable, chemical had potential but not in November. News showed the Dalian Exchange adjusted futures rules and there's talk of a 4-million-ton export. If true, the international supply-demand will change, enhancing China's product influence and the market linkage.

CCM Market Dynamics

In November, the spot market prices of corn starch in China showed a divergent trend. The prices in North China were on the weak side, while those in Northeast China remained stable for the time being.

For example, it was reported on November 8th that due to the weakening trend of raw material corn and the intensification of the contradiction between supply and demand in North China, some enterprises continued to slightly reduce their prices to stimulate downstream customers to take delivery, causing the center of market transactions to gradually shift downward.

According to the data from iFinD ofFlush, on November 21st, the price of the main corn starch futures contract was 2,580.00 yuan per ton. It dropped by 0.15% on that day, and the price change within five days was -0.35%.

As of November 13th, the total starch inventory of corn starch enterprises across the country reached 888,000 tons, an increase of 34,000 tons compared with the previous week. The weekly increase rate was 3.98%, the monthly increase rate was 11.70%, and the year-on-year increase rate was 44.86%.

Upstream and Downstream Demands

Upstream: Corn is the main raw material for corn starch. According to the observations of the CCM market intelligence platform, China corn Production was relatively sufficient in November. However, due to factors such as the narrowing of profits in the corn starch industry and China corn price fluctuations, the purchasing enthusiasm and quantity of some enterprises for corn were affected to a certain extent.

Downstream:Food Industry: As a food raw material, it is used in the production of candies, pastries and other foods. Driven by the consumption during the Double Eleven in November, there was a certain demand for corn starch. But as the e-commerce battle ended, the demand declined to some extent.

Paper Industry: It is used as a binder and surface treatment agent for paper and has essential applications in the production of corrugated paper and linerboard. According to the survey data of Mysteel Agricultural Products, in the first to third weeks of November 2023, the domestic production of corrugated paper was 1.317 million tons, an increase of 160,800 tons compared with the first to third weeks of November 2022, with an increase rate of 13.91%; the production of linerboard was 1.8612 million tons, an increase of 151,500 tons compared with the same period of 2022, with an increase rate of 8.86%. However, after the late November, the operation rate of paper-making enterprises showed a slight decline from a high level.

Textile Industry: The demand for it in terms of textile sizing and finishing agents is relatively stable, without any obvious upward or downward trend.

Pharmaceutical Industry: It is commonly used as a filler for tablets and capsules. The demand is relatively stable and is not significantly affected by the overall development of the pharmaceutical industry.

Chemical Industry: It is an important raw material for the production of biodegradable plastics and cleaners. With the improvement of environmental protection requirements, there is certain growth potential for the demand, but it was not prominent in November.

Latest News

According to the CCM industry research report:

On November 11th, the Dalian Commodity Exchange announced that starting from December 2nd, it would handle the registration of corn starch futures standard warehouse receipts in accordance with the revised rules. On November 12th, the Dalian Commodity Exchange adjusted the maximum limit of the entry and exit fees for corn starch futures delivery.

There is news that China will open up the export of corn starch. If the export can be carried out smoothly, the total volume is expected to be around 4 million tons. This may have a significant impact on the domestic corn starch market, increasing market demand and the production motivation of enterprises.

International Market

There are differences in the prices of corn starch in the international market. For example, on November 12th, the price of tapioca starch in Thailand was between $420 and $460 per ton, while the price of corn starch in Shandong region of China was between 2,830 and 2,880 yuan per ton, between 2,630 and 2,680 yuan per ton in Hebei region, and between 3,200 and 3,300 yuan per ton in Heilongjiang region.

According to the information from Business News Agency, the corn production in Brazil in the 2024/25 season is expected to reach 128.5 million tons. The increase in corn production may have an impact on the production of corn starch and the supply pattern in the international market, and further affect the international corn starch prices.

If the news that China's corn starch export will be opened up to around 4 million tons is true, it will, to a certain extent, change the supply and demand pattern of international corn starch, increase the supply in the international market, and may also enhance the influence and competitiveness of Chinese corn starch in the international market.


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