Massive Chinese Buying Spree Sends Corn Prices To Highest Since 2013
US corn futures are continuing to soar, hitting a 7-1/2 year high Monday. The bullish continuation in price is the result of “massive US corn sales to China last week,” according to Reuters.
Chicago Board of Trade March contracts are up 1.23% to $5.53 per bushel, to levels not seen since 2013.
Germany’s Commerzbank commented on the latest price action in corn, saying “Chinese demand for corn remains robust and unfavorable weather in South America” are some of the bullish catalysts lifting prices.
On Friday, the USDA reported China purchased 2.108 million tons of corn, the second-largest daily sale on record. The largest sale was in 1991 to the USSR, where US grain traders sold 3.72 million tons in one day.
Last week, US sales to China totaled 3.74 million tons, making it one of the biggest US corn export weeks on record.
“The after-effects are still being felt today,” Commerzbank added, regarding Friday’s report of the massive US export sales to China.
… and it’s only when President Trump is out of the White House that China ramps up its agriculture purchases.
So here’s the bad news. Food inflation is rapidly rising. Last month the Food and Agriculture Organization’s Food Price Index showed that prices in December rose for a seventh consecutive month.
Everyone’s favorite permabear, SocGen’s Albert Edwards, who, unlike Goldman Sachs, has warned about the latest surge in food prices could result in social instabilities.
Mon, 02/01/2021 – 21:00