3,200 yuan/ton! Corn prices surge continuously, hitting a 7-year high! At the beginning of February, feed for pigs, poultry, and fish all rose by 300 yuan.

On the first day of February 2021, more feed companies announced price hikes for their products, with increases ranging from 200 to 300 yuan per ton for pig, chicken, duck, and fish feed. Additionally, the Hainan Provincial Feed and Veterinary Drug Industry Association issued a notice on January 30 adjusting feed prices across the board, raising costs by 50 to 80 yuan per ton for all types of feed, including those for pigs, chickens, ducks, and fish.

According to a report from China National Radio, corn prices have continued to soar steadily so far, showing no signs of slowing down. As of now, the highest intraday price for the main domestic corn futures contract was recorded at On January 13, it reached a record high of 2,930 yuan per ton.

Currently, corn prices in China's major producing regions—Heilongjiang, Jilin, Liaoning, and Inner Mongolia—have so far remained largely stable. From 2,575 to 3,000 yuan per ton, secondary production areas such as Shandong, Henan, and Hebei range from 2,650 to 3,060 yuan per ton, while tertiary production regions like Shanxi, Shaanxi, Yunnan, and Sichuan remain largely stable at around 2,550 to 3,200 yuan per ton.

Corn prices continue "How to Cope with 'Excessive Price Increases'"

Compiled from China National Radio Network and Feed Industry Information Network

According to China National Radio Network, 2021 can be described as the year when crops finally "broke through" and reclaimed their value, especially as corn prices began to rise steadily from the start of the year. So far, corn prices have been soaring steadily, showing no sign of a downward trend.

Data shows that corn prices have surged significantly and are now at historically high levels. In the spot market, according to corn market monitoring and early warning data from the Ministry of Agriculture and Rural Affairs, In December 2020, the average wholesale price in domestic production areas reached 1.24 yuan per jin, a year-on-year increase of 35.6%, with an annual rise of 26.5% so far this year. On the futures front, as of today, the highest intraday price for the main domestic corn futures contract was recorded on January 13. Per ton 2,930 yuan, reaching a new all-time high , than More than five years ago, on March 11, 2015, the price reached 2,572 yuan per ton—358 yuan higher per ton and an increase of 13.9% compared to the previous level.

Corn futures hit a record high At its highest level in 7 years, soybean meal continues to face limited room for further declines.

According to Feed Industry Information Network, amid policy adjustments, mounting pressure from a surge in imported corn orders, coupled with sluggish market activity ahead of the Spring Festival and profit-taking by traders stocking up on spot corn, Starting January 28, corn futures prices in China have continued to decline, closing at 2,727 yuan per ton on that day. Currently, the 2,700-yuan-per-ton level is acting as a key support, while the upward momentum of spot corn prices has noticeably slowed.

However, the corn trend hasn't remained weak like this. China has cumulatively purchased U.S. corn for four consecutive days. 5.848 million tons, all delivered during the 2020/21 fiscal year. Affected by this, the market is concerned about tight global supply, according to the Chicago Mercantile Exchange. (CBOT) Corn futures closed up more than 2% on the 29th. Set a record The highest level in more than 7 years.

Recently, soybean meal prices have been fluctuating wildly—experiencing sharp spikes and steep drops, followed by another round of increases and declines. Last Friday, domestic spot quotes for soybean meal continued to weaken, with prices falling in many regions. Prices for coastal soybean meal spot quotes range from 20 to 40 yuan per ton, currently trading at 3,600 to 3,810 yuan per ton.

And On February 1, in the domestic soybean meal spot market, Dalian soybean meal futures repeatedly tested the 3,400-yuan support level. Meanwhile, spot prices at oil mills and distributors showed mixed movements—some edged up slightly, while others dipped marginally. With only 10 days left until the extended Spring Festival holiday, Stockpiling for the past year has largely wrapped up, so even with significant market fluctuations, there’s limited room for upward or downward adjustments in spot prices of soybean meal. ， On February 1, prices were mostly reduced by 20 to 30 yuan.

Feed prices continue to soar, with rising costs for pig, poultry, and fish feed. 200–300 yuan per ton

Due to the persistently high prices of feed ingredients like corn and soybean meal—especially with corn showing strong resistance to price declines—it’s unlikely that these commodities will experience significant volatility in the short term. As a result, feed companies remain determined to adjust their pricing amid ongoing cost pressures. In early February, Nanchong Guangda and other companies raised feed prices. 200–300 yuan per ton Meanwhile, the Hainan Province Feed and Veterinary Drug Industry Association is also Notice issued on January 30 regarding the adjustment of feed product prices, All feed prices—such as pig, chicken, duck, and fish feed—have increased. 50–80 yuan per ton.

Multiple factors driving up corn prices

According to China National Radio Network, from Looking at the national corn price trends as of January 20, 2021, Corn prices in most regions of our country have already risen to 2,800 yuan per ton—prices in China's major corn-producing regions, including Northeast, North China, Southwest, and Northwest areas, have also seen significant increases.

Currently, the total corn yield in China's major producing regions—Heilongjiang, Jilin, Liaoning, and Inner Mongolia—stands at Around 65 million tons, accounting for 35% of the nation's total corn production—yet in these regions, corn prices have generally remained at… RMB 2,575 to RMB 3,000 per ton The industry generally believes that this price is still relatively high in the main corn-producing regions.

Meanwhile, Shandong, Henan, Hebei, and other regions in China's secondary corn-producing areas In three regions, the annual total corn production consistently hovers around 54.21 million tons, accounting for approximately 29.3% of the nation's overall corn output. And so far, corn prices in these areas have remained largely stable. 2,650 yuan/ton to 3,060 yuan/ton.

In Shanxi, Shaanxi, Yunnan, Sichuan, and other regions that are China's third-largest corn-producing areas, the annual total corn yield has remained largely stable. Around 25.53 million tons—this accounts for approximately 13.7% of China's total corn production. Meanwhile, corn prices in these areas have remained largely stable at RMB 2,550 to around RMB 3,200 per ton 。

Industry insiders point out that, from a historical perspective, The continued rise in corn prices in 2020 was partly a recovery trend and also aligned with market expectations. But by the time At the beginning of 2021, given the current rate of increase, "overheating" has already emerged. This is a coincidental phenomenon resulting from the combination of multiple factors.

On one hand, after the cancellation of the corn strategic reserve policy, market prices are now primarily determined by supply and demand. However, issues such as historically high inventory levels and elevated production driven by inflated valuations—both of which had been masked under the previous reserve system—have suddenly surfaced in full force. This has led to a sharp increase in market supply pressure, causing prices to decline. In turn, the drop in prices has triggered a significant rise in consumption, further widening the gap between production and demand. As a result, the corn market is gradually shifting from a state of oversupply to one where production falls short of demand. Since the auction kicked off at the end of May 2020, market participation has surged to an unprecedented level, with nearly 100% of lots sold—and at notably high premiums—driving corn prices steadily upward.

On the other hand, factors such as the pandemic, extreme weather, and market hype have caused corn prices to fluctuate unexpectedly. "Over-inflation" The global spread of the COVID-19 pandemic has sparked international concerns about food security. In response, some countries have implemented export restrictions, triggering capital speculation that has driven up global grain prices—and subsequently pushed prices higher domestically. Meanwhile, typhoons have caused corn crops in parts of Northeast China to lodge, significantly increasing harvesting costs and fueling a surge in corn prices. Additionally, delayed harvests and market launches have led farmers to hold onto their stocks, while businesses scramble to outbid each other for purchases, further intensifying expectations of rising corn prices.

Rising raw material costs impact downstream industry businesses

As corn prices soar, industry insiders are openly admitting they just can't make sense of it.

"The surge in corn prices has become completely baffling—now it’s a pure seller’s market. In producing regions, if farmers have grain available, buyers will show up no matter how far away they are to haul it away. Plus, there are reports of traders hoarding supplies, which may also be artificially inflating prices to some extent," a industry insider remarked with concern. Meanwhile, it will be difficult for corn prices to fall sharply in the short term—future trends will depend on policy decisions and broader economic factors.

It is reported that, due to the recent continuous rise in corn prices, the number of vehicles waiting to unload at deep-processing enterprises in Shandong has surged, prompting companies to start revising their prices downward. Meanwhile, purchase prices in Northeast China have begun to stabilize after initially peaking. 2,930 yuan per ton—market forecasts suggest that futures prices still have upward momentum ahead, though the upside potential will be limited.

Although China is the world's second-largest corn producer, it is also a major corn-consuming nation. Corn consumption More than 90% is used for feed production and industrial consumption. Driven by persistently high hog prices and lucrative farming profits, production capacity continues to expand, leading to a month-over-month increase in both the number of market hogs and breeding sows on hand.

While rising feed prices will certainly impact livestock enterprises, industry insiders point out that the extent of the effect will depend on how much profit each company generates before accounting for costs. “ High profits have a small impact, while low profits are more significantly affected. Currently, pig farming companies still enjoy very healthy gross margins—so much so that the recent rise in overall feed prices has only nibbled away at their profits, without pushing them into losses. Egg-laying poultry farms are also doing well financially, but profit margins for broiler chickens aren’t as strong. Relatively speaking, feed price increases have had a bigger impact on these meat-focused operations. ”

As the Spring Festival approaches, pork consumption is entering its peak season, and the impact of feed prices on the costs of hog farming businesses cannot be underestimated. The pig farming industry relies on two main types of feed: one is protein-rich soybean meal, and the other is energy-focused corn. Notably, corn prices have risen compared to levels seen around New Year's Day. Around 400 yuan, less than 20%; soybean meal has risen by more than 1,000 yuan—up 34%—compared to levels around New Year's Day. When calculated comprehensively, feed costs for pig farms have risen by at least 20%. When discussing the reasons behind rising corn prices, relevant experts point out that, from a macro perspective, the primary factor is the shift in corn’s overall supply-and-demand dynamics—specifically, an existing supply gap. In fact, China has been undergoing structural adjustments in recent years: first, by reshaping its planting patterns to reduce supply at the production level; and second, by reconfiguring its industrial structure to enhance deep-processing capabilities.