Corn Products China News(Corn Products China News 202206)

In Q2 2022, the average ex-works price of MSG in China was USD1,510.7/t, up 17.7% YoY. Because the production cost of MSG was higher than that in 2021, MSG producers suffered overall losses in Q2.

Policy

China has been steadily advancing the industrialisation of GM corn in recent years. There are 11 GM corn varieties with insect resistance and herbicide resistance in China being granted safety certificates for production and application after 2019.

Market Analysis

• The EIA report of Golden Far East's 200,000 t/a lactic acid and 100,000 t/a Dl-Lactide or 100,000 t/a PLA project was made public; the EIA report of Keyuan's 200,000 t/a lactic acid and 130,000 t/a PLA was publicised for the third time.
• Recently, a number of sugar alcohol projects such as xylitol, maltitol and sorbitol projects are running smoothly.
• In order to maintain stable production and operations, recently, listed pig companies have sought to raise funds through bond issuance, private placement, short-term and mid-term notes, etc.

Company Dynamics

• On 31 May, the EIA report of Jilin Meihua's 20,000 t/a xanthan gum was publicised for the second time.
• The EIA reports of Cargill Bio-Chemical's technological upgrading project of 60,000 t/a modified starch and upgrading project of crystalline fructose have been approved.
• The EIA report of Henan Renhua's production line upgrading project was publicised for public comment.
• The environmental protection acceptance report for completion of Fuyu Yihai-Kerry's 1 million t/a corn deep-processing project (Phase I) was publicised on 20 June; as for Henan Jinyufeng's grand health bio-industry park project (Phase I), the roof of the warehouse has been constructed; in terms of NCPC's Bio-fermentation Base (Phase I), the test run of the steam system and the circulating water system in power workshop has completed.

Import and Export

In Jan.–April 2022, China's corn starch exports gained momentum, primarily because the corn starch industry faced high inventory pressure and enterprises were more interested in exports. In addition to that, the low ex-works prices of corn starch in China, the depreciation of the RMB exchange rate, etc. were also the main contributors. 

The USD/CNY exchange rate in this newsletter is USD1.00=CNY6.6651 on 1 June 2022, sourced from the People's Bank of China. All the prices mentioned in this newsletter will include the VAT, unless otherwise specified.