Analysis on the Trend of Starch Futures and Spot

"Starch dog" to the recent trend of starch, cause of this trend and the next trend analysis, welcome all friends in the industry to express their views!
Recent trends
Thailand's prices have been falling since June, from FOB530 to 500, and have since fallen steeply, from 490 to 480. The Vietnamese side dropped from the previous CFR 520 to around 500, and the current reduction is not significant, in stark contrast to Thailand.

The reasons for the above trend
1. Exchange rate reasons: The U.S. dollar has risen sharply recently, and the Thai baht, RMB, and Vietnamese Dong have all devalued to varying degrees;
2. .. Inventory: Thailand was too few people to take orders in the early period so inventory pressure, some manufacturers even rushed to dump due to financial problems and Vietnam did not have inventory pressure.
3. Raw materials: 2016 market prices are extremely poor farmers lose money and therefore changed sugar cane, 2017 starch market good cassava purchase price has been high, then farmers began to grow cassava so this year will be more than usual.
4. Demand: currently in the traditional off-season, check environmental protection, hot weather factory shut down the demand is very weak. Coupled with the great difference between cassava starch and corn starch, some users have switched to corn starch.

III. Next Trend Analysis Prediction
"Starch dog" analysis this year more than last year, prices will continue to fall in July and August, but affected by two factors, the exchange rate, the dollar will continue to strengthen? Will the central bank take action to avoid further devaluation of the renminbi? The second is raw materials. At present, Thai raw materials have gradually increased and factories have been started one after another. It is expected that raw materials will be more than in previous years from July to August. Some Vietnamese factories originally intended to start at the end of July, but because the Thai quotation was too low and their squeeze season did not come, the start of the operation would mean a loss, so it was simply not started. Recent widespread feedback from foreign suppliers about pest problems in cassava in Cambodia, Laos and Vietnam is likely to affect the next step in cassava production, but this information remains to be verified.

Cassava starch domestic spot situation: the port spot trading powder including border trade powder stock is still low, but this month began to start the shipment of square trading powder, traders for the upcoming peak season of 8.9 months to prepare. It is worth noting that many users have replaced corn flour at such high prices, so even if the season is not as good as it used to be, unless the difference between cassava and corn flour is around 500 yuan. The amount that is replaced may be returned to cassava powder. The processing of cassava starch has been compressed into no profit space. If it is not returned to a reasonable price, the amount of cassava powder is difficult.
From: Starch Dog Network