China’s millet market faces tight old stocks, larger 2026/27 area and weak processing demand, pointing to stable-to-soft prices and a likely high-open, lower trend.
Prices & International Context
Domestic raw millet prices in China are described as weak but broadly stable as the market digests the seasonal demand lull and tight old-crop stocks. Processors’ cautious procurement and low operating rates keep spot bids contained, reducing the likelihood of a late-season price spike before new crop arrival.
Export offers out of Beijing for hulled yellow millet kernels currently stand around EUR 0.86–0.94/kg FOB, slightly above levels in late July after a modest uptick, while Ukrainian millet seeds and kernels have been easing by roughly EUR 0.02/kg over recent weeks. This reflects relatively softer Black Sea pricing versus firm but not surging Chinese offers, suggesting limited external support for a sustained domestic rally.
Supply & Demand Structure
Old-crop millet stocks in China are now relatively tight, with remaining 2025 and earlier supplies estimated around 300–350 thousand tonnes nationwide, nearly 600 thousand tonnes below the same period last year. This structural drawdown means that by 2025-vintage grain the market is close to “bottom of the bin,” limiting downside from heavy old-crop selling but also removing a key bullish lever once new crop approaches.
On the supply side, 2026/27 national millet sowing area is projected at roughly 4.12 million mu, an increase of about 7–15% year on year. Regions such as Aohan and other core zones have widely adopted high-yielding varieties like Jinmiao K1, whose theoretical yields reach 400–450 kg per mu. However, the late-July to early-August spell of high temperatures and below-normal rainfall in Northeast China and Inner Mongolia has introduced yield uncertainty, especially in drier pockets where potential output is likely to fall short of the theoretical benchmark.
Demand is seasonally sluggish. At the processing level, mills are running at just 2.6–2.7% average utilization, more than 21 percentage points below the October 2025 peak. Many plants are in maintenance or quasi-shutdown mode and are procuring only against confirmed sales orders. This “two‑weak” structure—muted supply push due to limited old stocks and mills de-stocking, coupled with weak seasonal demand—helps explain the current narrow price range and low volatility in raw millet.
Weather & Crop Outlook (Key Chinese Regions)
In July, millet in major producing areas generally benefited from sufficient rainfall and good heading, supporting early yield potential. The shift since late July to hotter, drier conditions in parts of Northeast China and Inner Mongolia has increased moisture stress, particularly on lighter soils. Yield risk is concentrated in the critical grain-filling window around late August, when any continuation of dryness could trim realized yields versus the current expectations.
Short-term weather forecasts for Liaoning indicate continued warm to hot conditions with maximum temperatures near 31–33°C over the next three days, along with rising humidity and chances of light rain. Inner Mongolia’s core millet belt is expected to remain warm and mostly sunny, with highs between 28–30°C and cooler nights. These patterns, if accompanied by scattered showers, are broadly supportive of grain filling but will not fully offset prior localized dryness, leaving some downside risk to the top-end yield scenarios.
Fundamentals & Price Logic
The fundamental setup can be summarized as “low old-crop stocks, larger new crop, subdued processing demand.” Tight residual stocks remove the risk of heavy old-crop selling pressure, yet they also mean the market’s main focus has already shifted to the incoming 2026/27 harvest. The expansion in planted area implies that, barring a severe weather shock, overall output is likely to increase year on year.
Processors are running lean inventories and are strongly incentivized to clear old raw grain before the new marketing year. Their conservative procurement behavior and low run rates act as a ceiling on spot prices in the short term. Finished product markets, by contrast, are diverging: higher-quality or branded millet products can retain more pricing power, while bulk or lower-grade segments face stronger competition and discounting as buyers resist price increases in a weak consumption environment.
Given these dynamics, the most probable path for new-crop millet is a relatively firm opening as mills and traders secure initial volumes, followed by a gradual softening as larger supplies materialize and demand remains only modestly reactive. The risk skew is thus toward a “high open, lower trajectory” rather than a persistent bull run, especially if weather during the remaining reproductive phase remains broadly conducive.
Trading Outlook & 3-Day View
- Producers: Consider forward-selling a portion of expected new-crop production on early-season strength, but retain flexibility given remaining yield uncertainty. Avoid aggressive spot sales of limited old-crop stocks unless cash flow is tight, as the downside from here appears moderate.
- Processors: Maintain cautious, order-based procurement in the immediate term while preparing to scale up purchases rapidly if early new-crop offers appear below internal cost benchmarks. Monitor quality differentials closely, as weather variability may widen premiums for higher-grade grain.
- Traders: Favor range-trading strategies around current levels, with a bias to sell rallies into the early new-crop window. Watch weather in Northeast/Inner Mongolia and any shifts in domestic feed or food demand that could tighten the balance unexpectedly.
Over the next three days, Chinese millet spot prices are likely to remain broadly stable in EUR terms, with only minor local adjustments as mills continue low utilization and focus on depleting old stocks. FOB Beijing kernel offers in EUR should hold in a narrow range around recent levels, while Black Sea seed and kernel quotations are expected to stay on a gently softening to flat trajectory, offering limited support to Chinese export values.