Maize prices rise over 6% despite bumper crop
Maize prices in local markets continue to rise having touched Rs 7,410 per tonne despite a bumper crop.
By Arun Iyer, |
BANGALORE: Maize prices in local markets continue to rise having touched Rs 7,410 per tonne despite a bumper crop. Interestingly on year-on-year basis, prices are up 6.5% with traders and analysts hoping that the Centre would not ban export thanks following a bumper crop.
���There is no reason why prices have been rising despite the fact that India has had a production of 18.5 million tonnes in the 2007-08 season. Prices would be northward bound if exports continue,��� sources told ET. Incidentally the domestic maize demand in pegged at about 15.2 million tonnes in 2007-08 indicating a 7% year-on-year rise. Maize exports are projected to be around 2.4-2.5 million in 2007-08.
Bulk of the maize produced in the country goes for production of poultry feed with analysts suggesting that for 2008-09, the demand from India���s poultry industry would rise by a slightly muted 6%.
Market analysts also say that clarity about the 2008-09 crop is only expected after June. In the Indian context, maize is a kharif crop with harvests and arrivals due only from October onwards.
���If rains are abundant, there would be in all possibility a good crop in Karnataka and Andhra Pradesh, two of the major maize producers,��� said an analyst. It would be recalled that Karnataka had a bumper maize crop about four years ago when output crossed the 1.9 million tonnes mark.
What lends additional worry is that the recent report by the US Department of Agriculture (USDA) has suggested that US corn crop is projected at 12.1 billion bushels, down 7% from the record 2007-08 crop.
The report also paints a gloomy picture of the ending stocks in 2008-09 which are projected at 99 million tonnes, hitting a 25-year low. It has also lowered the estimate of corn used for ethanol production by 2.5 million tonnes to 76.2 million tonnes in 2007-08.
���There is no reason why prices have been rising despite the fact that India has had a production of 18.5 million tonnes in the 2007-08 season. Prices would be northward bound if exports continue,��� sources told ET. Incidentally the domestic maize demand in pegged at about 15.2 million tonnes in 2007-08 indicating a 7% year-on-year rise. Maize exports are projected to be around 2.4-2.5 million in 2007-08.
Bulk of the maize produced in the country goes for production of poultry feed with analysts suggesting that for 2008-09, the demand from India���s poultry industry would rise by a slightly muted 6%.
Market analysts also say that clarity about the 2008-09 crop is only expected after June. In the Indian context, maize is a kharif crop with harvests and arrivals due only from October onwards.
���If rains are abundant, there would be in all possibility a good crop in Karnataka and Andhra Pradesh, two of the major maize producers,��� said an analyst. It would be recalled that Karnataka had a bumper maize crop about four years ago when output crossed the 1.9 million tonnes mark.
What lends additional worry is that the recent report by the US Department of Agriculture (USDA) has suggested that US corn crop is projected at 12.1 billion bushels, down 7% from the record 2007-08 crop.
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The report also paints a gloomy picture of the ending stocks in 2008-09 which are projected at 99 million tonnes, hitting a 25-year low. It has also lowered the estimate of corn used for ethanol production by 2.5 million tonnes to 76.2 million tonnes in 2007-08.
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