Firmer ag prices in May; Wheat auction demand poor; US corn exports to China jump

Agriculture prices moving higher in mid-May

Prices for grains, feed ingredients and agricultural inputs were generally higher in mid-May compared to the start of the month, according to data from the National Bureau of Statistics.

Live hog prices jumped 4%, soybeans rose 2.5%, soy meal rose 1.3%, and corn was up 0.2%. Wheat prices fell 0.5% ahead of the new crop harvest.

Input prices kept moving higher with urea up 4.7%, compound fertilizer up 2.9%, pesticides up 0.9%, and diesel up 0.2%.

Wheat auction demand in eastern Chinese province slump

Demand for wheat at government reserve auctions in Jiangsu province on the east coast struggled to gain momentum this year with only 96,000 tons sold in 2022 so far.

The figure is down 5.21 million tons year on year, equating to a 98% drop.

Auctions have largely failed to attract demand this year as prices are hovering at an elevated level. The average weekly traded price at auctions were 2,698-3,160 yuan/ton ($403-472/ton), whereas the average price during the same period last year was about 450-500 yuan/ton lower ($67-75/ton).

As global wheat prices are still strong and domestic wheat crops face a potential lower yield, domestic wheat prices in China could continue to hover near current level until winter wheat harvest starts in two weeks.

US corn exports to China triple week on week to hit YTD high

US exports of 2021/22 corn crops to China during the week of May 13-19 more than tripled from the previous week to nearly 793,000 tons last week, according to latest USDA data.

The volume shipped to China last week was the highest in 2022 calendar year so far.

It accounted for 47% of total US corn shipments last week.

US soybean exports to China during the week also jumped 93% from the previous week to 162,155 tons, representing 28% of overall US shipments globally.

For sorghum, US exports to China last week totalled almost 196,000 tons, unchanged from the previous week.

At the same time, there remains no US wheat shipments to China since late January this year.