Domestic corn market expects to reopen corn futures

Introduction: corn is one of the three major food varieties in China, with planting area and total output accounting for more than a quarter of the total national output, accounting for about 20% of the total world corn output Facing the new situation of China's accession to the World Trade Organization and the coexistence of challenges and opportunities, it is an important and urgent measure for China's grain to re open corn futures 1 New problems faced by China's grain circulation under the new situation After China's accession to the world trade organization, the pattern of production and distribution of grain in China will change The original pattern of "North grain transportation to the South" will probably be replaced by the pattern of "North grain transportation to the South" and "North grain transportation to the South" Therefore, for such a major corn producing area as northeast China, it is likely to face severe challenges On the one hand, due to the opening of the domestic corn market and the abundant supply of corn in the international market, the quality of corn is higher than that of domestic corn, and the price of corn is relatively low compared with that of domestic corn, it is inevitable that foreign corn will flow into the southern market of China, which will have a certain impact on the main production areas of Northeast China; on the other hand, due to the low quality and price of corn in the North generally As a result, the export of corn from the North has become a more difficult problem, which is the "new northeast phenomenon" caused by China's accession to the WTO After China's entry into WTO, the new pattern of circulation of corn "going south but not going north" will lead to a series of new problems 1 Corn price is difficult to operate at a higher price After China's entry into WTO, a certain amount of foreign low-tariff corn will flow into the domestic market, which will increase the pressure on the supply of corn in the domestic market, force the price to fall, and gradually close to the international market price Meanwhile, the state's protection policies for grain enterprises will also be reduced, and the grain price will be more determined by the market mechanism 2 The benefit of corn production will decrease and the income of farmers will be affected In recent years, the income of farmers in China's main grain producing areas has been reduced, the production efficiency of main grain producing areas has been improved, and the increase of farmers' income has become a prominent problem in the development of "agriculture, rural areas and farmers" In particular, the main corn producing areas in Northeast China, whether in the domestic market or in the foreign market, are facing strong competition from the United States and other corn producing countries The market share will be reduced to a certain extent, and the income of farmers will be negatively affected 3 State owned grain enterprises will be impacted and market pressure will increase China's state-owned grain enterprises have not really become the market subject of self-management, self financing, self-development and self-restraint, with no separation of government and enterprise, no active mechanism and high operating cost After China's accession to WTO, state-owned grain enterprises are not only hard to compete with large foreign companies, but also face survival crisis In order to meet the needs of entering WTO, it is imperative for state-owned grain enterprises to speed up the pace of reform and truly enter the market 2 The necessity of opening corn futures 1 China's futures market has stepped into a standardized track After 10 years of trial and 7 years of rectification, China's grain futures market has the conditions to give full play to its role Generally speaking, China's futures market has been on the legal track, and exchanges and futures trading companies have corresponding management methods Therefore, it can be said that China's futures market has entered a relatively mature stage from the pilot stage, with standardized development and playing its due role 2 In China, corn is suitable for futures according to its own characteristics First of all, corn production is large In the world's grain production, corn production has always been in the top three of the world's grain production, in the first place of coarse grain production, and China's corn production area is one of the world's three major gold belts, the total output is second only to the United States, so corn is more suitable as a futures crop Secondly, industrial consumption is large Corn is the industrial raw material with the most extensive use, the most exploitable products and the largest consumption in food crops Corn is not only widely used in feed, starch, alcohol and other aspects, but also in food industry, chemical industry and pharmaceutical industry With the increase of planting area of special high-quality corn and the development of deep processing and fine processing of corn, it can be said that corn has become an important industrial raw material in the world and China Finally, the volume of trade is large In the current world grain trade, corn is the second highest, with an annual trade volume of about 700 million tons, accounting for more than 1 / 4 of the total world grain trade China is a big corn trading country in the world Before entering WTO, it was basically a net exporter Although entering WTO will have a certain impact on corn export, generally speaking, corn is also suitable for futures in China 3 The impact of opening corn futures on the domestic corn market In the new situation, facing new problems, reopening China's corn futures market will have the following impacts on the domestic corn market: 1 It is conducive to meeting the challenges brought to us by China's accession to the WTO At present, there are two kinds of price policies for corn purchase in China: to continue to implement the protection price purchase for the main production areas in Northeast China, and to withdraw the protection price purchase for corn in other areas (such as Hebei, Shandong, Henan, Shanxi, etc.) From the perspective of the main corn producing areas in Northeast China, China's accession to the WTO will bring impact on the protective price of corn Because the futures price is generally higher than the protective price of the producing areas, the futures market will not only not impact the protective price of corn in the main corn producing areas in Northeast China, but also may provide a new channel for the sale of corn at a favorable price due to the existence of physical delivery rules in the futures market From the perspective of Hebei, Shandong, Henan, Shanxi and other regions, these regions are the main production areas of low moisture and high-quality corn When the corn in these regions withdraws from the protected price, the price will be regulated by market supply and demand, and producers and operators will face the market risk of price volatility directly Timely resumption of corn futures trading will help corn producers and traders in these regions to effectively avoid price risk, thus stabilizing the production and circulation of corn 2 It is conducive to play a guiding role in grain production At present, based on the existing grain market system in China, the futures market and wholesale market are further combined to form a complete and multi-level market system, so as to guide farmers to arrange corn production according to market demand more effectively through the market In particular, the reasonable design of corn futures contract can not only ensure producers and operators to avoid market risks, but also guide farmers to adjust the structure of corn varieties and improve the quality of corn For example, if the quality of corn futures contracts is high, such delivery quality and the formed futures price can guide farmers to grow high-quality corn 3 It is conducive to invigorating operation and reducing losses of state-owned grain enterprises At present, the corn market is in a situation of oversupply, with periodic surplus and serious loss of grain enterprises It is not only not suitable for the demand of "entering WTO", but also difficult to survive In order to get rid of the difficulties, grain enterprises need to use the futures price to guide the operation, and also need to use the futures market as a hedging tool to disperse market risks and improve the competitiveness of enterprises It is of great significance for grain enterprises to take the futures market as an effective means for grain circulation enterprises to avoid operational risks and ensure target profits, so as to improve their operation and economic benefits, and at the same time, to make grain enterprises more adapt to the development of market economy Corn is the oldest futures variety in the world It is reported that China will reopen corn futures in July this year, and now China's futures market has been gradually standardized The hedging and price discovery functions of futures trading will play a protective role in risk aversion of grain market And now the conditions are getting more and more mature, it is fully possible to reopen the corn futures varieties, and will play a significant role (author:) share to feed Weibo share to: