For the Quarter Ending June 2023

North America

In the second quarter of 2023, the US Corn starch (Maize starch, Corn flour) market experienced volatility. The first two months of the second quarter saw steady price gains due to supply and demand dynamics. Increased demand from end-user suppliers led to a moderate shortage of Corn starch on domestic warehouse shelves, resulting in price hikes. Trade between Asia and the United States has increased since the abolition of the zero-resistance policy against COVID-19. Additionally, production costs of corn starch have risen due to the increasing prices of corn and other inputs. In early June, prices started to fall due to weak demand, leading to excess inventory and forcing suppliers to lower their prices. The ongoing economic instability in the US and rising global inflation rate have also contributed to the decline in demand for corn starch. However, distributors are reluctant to place large orders due to falling prices. Major players in the market are expected to further reduce prices in the coming months. The price of feedstock corn has also declined due to surplus supply and increased production. Distributors and suppliers are not restocking their inventories as they try to clear the surplus.

Asia

The Corn starch market in the Asia Pacific region in the second quarter of 2023 displayed a mixed trajectory. From the beginning of Q2 until the middle of Q2, the market experienced significant price inflation due to soaring domestic and international orders. Increased production rates aimed to replenish inventories and meet the upcoming demand. However, the supply of Corn starch has been somewhat constrained due to factors like production disruptions in China and the ongoing war in Ukraine, contributing to the price increase. China's exports performed better than expected, with consistent inquiries from domestic and international markets. Toward the end of Q2, prices fluctuated and significantly deflated due to decreased sales in final consumption areas and no new inquiries from suppliers. Demand from downstream industries like food preservatives, plasticizers, and cosmetics has declined in recent months. To reduce existing inventory, suppliers had to decrease the price due to a large inventory of Corn starch in warehouses.

Get Real Time Prices of Corn Starch: https://www.chemanalyst.com/Pricing-data/corn-starch-1431

Europe

The Corn starch market in Europe appreciated during the second quarter of 2023. As the quarter began, prices rose due to a gap in supply and demand. The surge in domestic inquiries further fueled the price hike. However, dealer inventories were sufficient to meet the gross demand for the month. Another factor contributing to increased demand for Corn starch was the appreciation of the Euro against the US Dollar. Unexpected production cuts by OPEC+ members also had a positive impact on the market. Higher energy costs, production costs, and transportation costs all contributed to the market's continued strength. The Euro's strength against the US dollar could make German exports more expensive for foreign buyers, potentially reducing export sales, while imports would become cheaper for German consumers, potentially increasing domestic inquiries. Inflation in Europe fell to 7.4%. The United States, being the largest corn producer, experienced a decrease in corn crop due to drought, leading to reduced corn starch supply and upward pressure on prices. Speculative trading has also contributed to the increase in corn starch prices as speculators anticipate further price increases. It is likely that prices will remain high for some time due to the expected continuation of drought conditions in the United States.