Suppression of agricultural product rally

Northeast corn auction statistics

Dalian corn corn transaction

Brazil's sugar cane and pre-loaded cargoes have now shown a declining trend (10,000 tons, vessels)

The recent surge in the prices of agricultural products throughout the country, especially basic foods, has broken through the high prices in recent years. Agricultural products account for a large proportion in the CPI composition. Their price increases have a large amplification effect on CPI. If agricultural product prices continue to rise, inflationary pressures in the country will increase significantly in the second half of the year.

Some experts pointed out that to effectively curb the irrational rise in the prices of agricultural products at this stage, it is necessary to take decisive measures to strengthen the government's management and control over the supply of agricultural products. Including increasing the throwing power of corn, sugar and edible oil and other varieties to cope with the sharp increase in agricultural product prices.

The effect of regulation and control is remarkable

This year, the state has thrown up reserves with both economic and supply backgrounds: On the one hand, China's money supply in 2009 was too large, and the market was in excess of liquidity. Under the background of market regulation and stock market weakness, funds were concentrated in agricultural products, pushing the CPI higher; on the other hand, Since last year, China’s weather conditions have been poor, and some agricultural products have reduced production. This year, the weather is unstable, droughts and floods linger, and the market expects stronger agricultural output reduction. In this context, it is necessary for the country to sell out reserves to ensure market supply and stabilize prices.

Sun Xiaofei, an analyst at CSC Futures, said that the country's stockpiling has indeed affected the market, eased the price increase and limited the rate of increase. "For example, the national central reserve of corn was adjusted and controlled in June to form a significant effect on the market, and timely revision of the auction rules also led to the direct flow of corn into demand enterprises, reducing the intermediate circulation, lowering the cost of corporate procurement, and also reducing the market's stocking behavior. It has a good effect on keeping food prices down."

“In fact, the country started to dump corn in April. Its fashion is in the peak season for farmers to sell grain, which also reflects the country’s determination to stabilize prices.” Sun Xiaofei said that because the regulation effect was not ideal at that time, the country started the central government in June. Reserves, and amend the auction details, guide the sale of food can mainly flow to the production company, "it is expected that the deposit will be carried out in the later period, but by the sharp decline in stocks, the intensity will be increasingly weak."

“For the corn market trend, in fact, the final decision is the weather, for example, corn, because last year's inventory has been basically exhausted, if there is a problem with corn growth, then the country will be unable to regulate and control; Fortunately, currently, corn production is expected to yield Although strong is inevitable, it will leave a better supply background for the country to stabilize prices." Sun Xiaofei said.

The consumer season will end

Sugar prices are difficult to rise

"For the country to take measures such as throwing storage or receiving storage, we must first clarify its purpose. For the 7th sugar market in this crop season, the main purpose is to ease the short-term supply tight pattern." Shanghai Intermediate Futures Analysts said that, on the one hand, domestic sugar production has been cut for two successive crop seasons. The 2008/09 crop season was reduced by 2.219 million tons, and the 2009/10 crop season was reduced by 1.6929 million tons, which resulted in supply in the market. Declining trend, while the domestic sugar itself is a rigid demand; the other hand, the domestic sugar is a quarterly annual sales, so during the peak season, the country will take measures to throw out reserves in order to stabilize excessive price increases.

Judging from the fundamentals of sugar, it is a fact that the supply of sugar is tight in the global cropping season. The main reason is that the sugar production in the next crop season will be a key factor in whether sugar prices continue to rise. Judging from the current situation, international sugar in the next crop may be converted from a gap in the original supply to an oversupply due to increased production in India and Brazil. In terms of domestic sugar, the planting area of ​​sugar in the next crop season has shown an increasing trend, but due to the uncertainty of weather factors, there is also a large amount of uncertainty in production. For sugar, if the production of sugar in the next crop increases, the possibility of further price increases will be greatly reduced, and prices may not fall out of trend. This depends on the output of the 2010/11 crop season.

According to Yu Chengcheng, judging from the situation in which sugar is dumped and stored, the impact of the dumping on the market and the price of each throw is not an immediate issue. From the perspective of recent dumping movements, the impact on the market comes from two aspects: First, although supply is in short supply in circulation, the national inventory can ease this pressure; on the other hand, the national reserve stocks are declining due to the total transaction turnover. In the case of uncertainties in the output of the next crop season, the market continues to be bullish or a sharp bearish sugar psychology has not yet emerged. The impact of throwing Reserves on prices is seen in the short-term, as the price of dumped deposits has been rising all the time, which has led to an increase in the quotations in the spot market. In the medium term, demand for sugar will slow down as sugar is pumped into food processing companies, which will inhibit the further rise in spot sugar prices.

"After reviewing the seven dumping procedures before the cropping season, the fifth, sixth, and seventh dumping average prices started in April this year showed continuous rises, at 4955.55 yuan, 5247.93 yuan and 5417 yuan respectively. According to the contents of the meeting held at the end of April, 400,000 tons of reserve sugars that need to be processed have been processed and 250,000 tons have been processed, showing a trend of increasing from the prices of recent transactions. "Zhengcheng believes that with the end of the summer shopping season, the next possible transaction price of dumped storage will hardly rise again.

From lead to lead

Vegetable oil highlights throwing motivation

Yang Lina, a senior analyst at the Beijing Intermediate Futures Institute, said that from the beginning of July to the middle of August, there has been a sharp upswing in the spot period of the oils and fats. Take soybean oil as an example, the price fluctuation range is about 16%, and rapeseed oil is even more innovative. Since the financial crisis hit a new high, spot prices have followed a significant upward trend. Due to frequent domestic disasters, food price volatility has increased. In July this year, driven by the price of food, the domestic CPI hit a new high during the year. Since August, food prices have continued to rise, and food prices have accounted for nearly 30% of the CPI's calculation. This is a major factor affecting domestic inflation. Therefore, several agencies predict that the CPI will rise to a record high in August driven by rising food prices. .

The pressure from rising food prices has increased, and the country’s intention to stabilize food prices has stabilized. Yang Lina said, "The recent increase in the country's efforts to corn auctions, while the operation on vegetable oil also shows that the country will put in reserves of oil and fat reserves, in order to stabilize the excessive price fluctuations."

On August 18, the domestic oils and fats market fell sharply, and rapeseed oil led the drop. Due to market rumors, State Reserve vegetable oil may be sold on futures, leading to vegetable oil leading the decline. “Looking at the registered warehouse receipts after the end of the stock market, the Hefei Hefei formed a huge amount of vegetable oil warehouse receipts, and the news was confirmed. From the current price point, the spot vegetable oil profit margin exists, and this price is indeed higher than the cost price of the State Reserve vegetable oil for two years. The emergence of a high level of hedging pressure does not seem to be accidental," said Yang Lina.

Donghua Futures Wang Aihua believes that the current supply of the oil market is still relatively abundant, and the spot market is increasingly expected to cast stocks in the future. Affected by this, some oil traders have accelerated the pace of taking goods with lower bargaining prices, which further suppressed the spot market. Popularity. The current prices have all experienced a certain degree of decline, while the country's stable prices and policies and measures to control the CPI have, to a certain extent, suppressed the rise in oil prices. Wang Aihua said, "As for the impact of the state's throwing deposits, we must pay close attention to the continuity of the country's dumping deposits."

Yang Lina said that the country’s recent intensive measures of supply, as well as measures in the grain and oil markets to prevent excessive price volatility, have affected agricultural commodity futures markets with clear signs of adjustment. In addition, the recent international agricultural product market also shows signs of a correction, and the timing of the implementation of the policy is suitable to achieve an immediate effect. Judging from the country’s recent position, the latter countries will adopt comprehensive measures on trade purchases and sales of agricultural products markets, integration of large-scale enterprises, and reserve deposits, stabilizing market supply, weakening excessive bullish market expectations, fighting speculation on agricultural products, and stabilizing prices.

Analysts said that in the face of bad policy, temporarily adjust and squeeze out the bubbles formed in the early stage of agricultural products because of excessive rapid rise, return to the fundamental supply and demand. In general, the short-term effects of the negative effects of policy deposits are significant. In the long run, the rhythm and continuity of stockpiling will affect market sentiment. At the same time, if the total amount of stockpiled stocks is sufficient to supplement the market supply, it will restrain the room for the price to continue to rise, but if the stock is small, it will still be Will return to its own supply and demand side to determine the trend.

Rising sugar prices seem like a tough end

Although the recent international sugar price once again exceeded 20 cents and reached a new high since March this year, all indications indicate that the driving force behind this sharp increase in international sugar prices is declining, and the upward trend under the conditions of rising funds is already a tough end.

The fact that international sugar prices have risen since July has actually depended on strong demand and over-concentration of supplies. The export capacity of Brazilian ports has become a bottleneck in the current round of higher sugar prices; in the Middle East and other places for replenishment from Ramadan in July. It began to intensify the import of sugar; Thailand, the original exporting country in the Asian region, had already cleared the goods due to the strong export of the previous period, and even joined the import army to meet domestic consumption. Demand for sugar imports from Asia and Africa has been concentrated in Brazil for a time. This has caused Brazil's sugar ports to carry pressure and the raw sugar in the port to rise significantly – climbing to a rare 1.3 cents.

However, this situation is expected to change in the near future.

On the one hand, the Islamic month of Ramadan, which has triggered a surge in demand for sugar imports, is about to pass. This part of the demand for supplemental library will drop sharply from September. According to the latest data released by Brazil’s Williams Shipping Company, the number of ships entering Brazil’s ports for shipment of sugar in the coming weeks will be reduced from 130 ships last week to 114, and the amount of sugar waiting for shipment at ports will also be reduced from 3.45 million tons last week. 337 million tons. It is not difficult to see from the figure that this is a significant reduction in the volume of sugarcane and sugar shipments in Hong Kong since April, and with the lifting of the concentrated import demand from Ramadan in Asia and Africa, the above indicators will also be The future will continue to fall for some time.

On the other hand, the new crop season for sugar producing countries in the northern hemisphere is approaching, and the listing of a large amount of new sugar is expected to ease the short-term supply and demand tension. In the northern hemisphere, sugar-producing countries such as India, Thailand, China, and the United States all started production in the new crop season from October to November. With the arrival of new sugar, consumer terminals will be more inclined to purchase new sugars that are resistant to storage and postpone their use. This will further ease the imbalance between supply and demand in the international market in the short term.

In particular, it is worth mentioning that the rainfall in the new press season in India is relatively stable. From the 1st of June this year, India’s weekly precipitation anomaly (the difference between actual precipitation and historical average) is only 6% lower than the historical average. The figure for the same period of the cropping season is “40% lower”, so the Indian sugar cane crops in this crop season have basically no drought effect, and sugar production is expected to return to 1800 – 19 million tons or even higher, and the 10/11 crop season will follow. With the lifting of the effects of drought, its output may further increase to more than 25 million tons, thereby restoring its status as a sugar exporter. The Indian government recently agreed to export hundreds of thousands of tons of sugar at the port at a low price, and plans to resume Indian sugar futures that have stopped trading for more than a year. All indications also indicate that India’s confidence in the continuous improvement of its sugar supply and demand environment is being Gradually increase.