Commodity Update
At the end of the year, we need to understand one fact that the markets be in bullion, stocks, commodities or real estate, peaked. Most of this was due to easy availability of funds. Looking at two of the commodities
Barley
The week started with fairly high prices touching $196 per MT (at market yards), which by mid week had risen to $ 200 per MT. Some varieties did show a drop in prices due to quality issues. The trend of high prices is likely to continue, till the new crop comes into the market, which will be in April 2006.
Reports available indicate a better barley crop in 2006 and the market will see a drop in prices. In the year 2004, the area under barley was 0.773 million ha, which this year (2005) is up by 5.56% to 0.816 million ha.
The malt industry though specifies the varieties, but due to the poor availability, it should buy what is available in the market and most times, there is no varietal purity.
Corn
The week started with a mixed note, with some varieties touching a high of $140 - $142 per MT at the market yard and staying the at the same level till mid week and ending lower. Sone varieties did start low at $112 per MT, but achieved a high at $139 by mid week and went down by the end of the week. The average prices though remained same at $129-130 per MT though out the week.
Prices in the production states particularly in Karnataka are ruling at a very low level ($106-108 per MT) at the market yard and the state is fulfilling the requirements of states like Maharashtra, Tamil Nadu, Gujarat to a large extent. Reports available also indicate movement of large quantities of corn to Bangladesh as well to fulfil its requirements. The poultry industry in Bangladesh is growing at overt 25% and the demand of corn is about 900 TMT and more than 50% of its requirement is met from India.
The market year for corn 2005-06 started on a high note and prices in all the areas have remained high all through the season except in Karnataka, where the production was very good. In all other areas production was higher and highly unlikely that the prices will come down in the year as the demand increases.
The highest average price of corn in Dec 2004 was $121 and the lowest being $113.5 per MT at the end of the month. In Dec 2005, the lowest was $122 per MT and the highest $130 per MT, which is about 14% higher than last year prices at the same time.
On Dec 30, 2005 the corn at CBOT closed at $2.15 per bushel ($84.62 per MT), similar to to last week closing of $84.37 per MT. The FOB value (US Gulf) would be close to $106 per MT.
Rabi Planting
As on Dec 25, 2005, Wheat & Barley planting is reported up 2.5% and 5.56% respectively. Planting of Corn and Jowar is down by 3.5% and 5.76% respectively. In addition Rice planting is also down by 1.88% from last year.
Delivery Costs
Currently all commodities in India are bagged and transported by trucks, which are in most cases overloaded. The new directive from the honourable Supreme Court, would not over loading of trucks, which would mean increase in freight rates and ultimately cost of commodities at the end users point.
Is Europe going soft on Biotech?
A draft note circulated by European Commission last week authorises contamination of biotech products in organic agriculture. The new draft allows 0.9% GM contaminated agriculture product to be labelled as organic, which is contrary to the current legislation.
Another report also indicates that WTO has ruled in favour of US challenge of EU import restrictions which do not allow sale of biotech foods in United Kingdom and European Union states. Based on the ruling, biotech products will be available in UK and EU and food processors in US, Canada, Argentina and Australia will be allowed to sell processed foods containing biotech products in UK and EU. The products could be corn chips, tortillas, bread products, biscuits and ready meals. The reports says, “WTO has decided that attempt by EU nations to slow approvals for GM (biotech) foods or ban them outright – amounts to illegal restraint of free trade”.
In the year 2005 as per USDA data, EU (25) purchased Corn Gluten meal HS code 2303100010 worth $26.77 million, Corn Gluten Feed HS code 2303100020 worth $199 million and Soybean Meal HS code 2304000000 worth $16.36 million. More information is available on the following link.
http://www.fas.usda.gov/ustrdscripts/USReport.exe
The CGM, CGF and SBM are used to feed the poultry and livestock and the products are not labelled as on date.
New laws to safeguard the interest of consumers and the environment
Now that Delhi government has banned street slaughter, Ministry of Food Processing Industries has included frozen and chilled chicken under Meat Food Products Order (MFPO) wing and Delhi Agricultural Marketing Board (DAMB) plans to set up a state of the art poultry processing plant for Delhi, there are more things that need to be done to safe guard the interests of consumers.
In an interesting move recently Ireland’s Department of Agriculture has banned disposal of food waste including raw meat, fish and poultry waste in sanitary land fills. As per the new law the food businesses must ensure that they have the necessary procedures in place to dispose the material correctly by rendering. The E.U. Animal By-products Regulation sets rules to safeguard public and animal health by ensuring the safe handling and disposal of animal by-products not intended for human consumption.
By-products include raw meat, raw fish, and former foods of animal origin when they are no longer intended for human consumption from retailers, distributors, wholesalers, and food manufacturers. Catering waste, defined as waste from restaurants and kitchens, including central and household kitchens, is not included in this definition.
In the explanatory notes it is mentioned that in order to safeguard public and animal health, waste raw meat, fish, and poultry must be kept separate from other general waste by having separate containers for the storage of the two types of waste. If they are not kept separate they must all be dealt with as raw animal by-products and cannot be land filled.
Currently in India, most of the wastes from municipals slaughter facilities (large and small animals) and from shops doing poultry slaughter is picked by municipal trucks or packed in bags and is disposed of at the city land fills, which are the breeding ground of diseases. Though it is the responsibility of the municipal corporations to dispose of this waste properly, it is seldom done.
Another law that takes effect in EU from Jan 01, 2006 is the ban on use of antibiotics as growth promoters. This is the final step to tackle the emergence of bacteria and other microbes resistant to antibiotics, due to their overexploitation or misuse.
As per the commission, it is a necessity considering public health and will effectively address the problem of micro-organisms becoming resistant to treatments that the population has relied on for years. Animal feed is the first step in the food chain, and so a good place to start. Antibiotics can now be used only for veterinary purposes.
In India there is currently no law which mandates a withdrawal period for feed containing antibiotics before the birds (chicken) is sent to the market or to the processing plants.
By adopting good management practises and proper bio-security it will be possible to tackle some of the emerging problems and other can be tackled by proper vaccination and antibiotics can used when ever required. But in order to safeguard the rights of consumers and also human and animal health, it will be necessary to enact laws as above.
May the New Year bring more opportunities knocking on your doors and may success & happiness be yours.
Wishing you a very happy and a prosperous new year 2006 !!
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
December 31, 2005
Saturday, December 31, 2005
Friday, December 23, 2005
Corn prices remain high; Health benefits from Barley; Meat Consumption in US on the rise
Corn prices remain high
As we enter the last week of the year 2005, it seems the corn prices are going to end on a high note. Looking at the prices same time last year, corn was traded at the market yards across the states on an average all India value of Rs.5251 ($118) per MT, while this year same time the average all India price is Rs.5805 ($129) per MT. This price is about 10.55% higher than last year at the market yard.
Just to compare prices of some varieties in the third week of Dec 2004 and Dec 2005
Deshi Red $ 125 in Dec 2004 and $ 135 in Dec 2005
Yellow $ 125 in Dec 2005 and $ 132 in Dec 2005 (it reached $142 on 21 Dec 2005)
Uttar Pradesh, which at one time produced a sizable crop, reports a down trend and the crop is expected to be down by approximately 35%. Other states which are expected to produce less than last year are Rajasthan (down by 30%), Punjab (down by 35%), Gujarat (down by 12%). The only states which have produced more than last year are Andhra Pradesh (up by 38%) and Karnataka (up by 40%), but these high productions are not enough to cover the gap. Despite the increase in production in these two states, the prices of corn are ruling higher in Andhra Pradesh as well as Karnataka, indicating a higher demand from other states.
While in the world situation, USDA has increased the corn export number for China from 3 MMT to 6 MMT, but this has not decreased the grain prices in China. Grain output in China is expected to have jumped by more than 10 million metric tons to over 480 million tons, as per the National Development and Reform Commission. It is reported that a favorable weather also boosted the bumper crop last year.
Grain yield is expected to average 4.449 tons a hectare from 2001 to 2005, higher than 4.424 tons during the 1995-2000 period.
Profitability in grain planting in China has decreased this year due to rising prices for agricultural inputs, such as fertilizer, but it still can be regarded as one of the best years, judging by historical standards
Health benefits from Barley
There are two main types of dietary fiber - soluble and insoluble. The main difference between the two is how they move through the digestive tract. Insoluble fiber, also known as roughage, moves through the digestive tract mostly undisolved. Soluble fiber (beta glucan) mixes with liquid and binds to fatty substances to help remove them from the body.
Studies show soluble fiber (beta glucan) is effective in lowering blood cholesterol and has also been shown to be beneficial in slowing the absorption of sugar, which, for people with diabetes, may help decrease the need for insulin. Barley and oats are the only two edible grains that contain significant levels of beta glucan.
Studies show that insoluble fiber is beneficial in lowering the risk of bowel disorders and colon cancer.
The U.S. Food and Drug Administration (FDA) announced that barley consumption can help reduce coronary heart disease. Whole grain barley and certain dry milled barley grain products are appropriate sources of beta-glucan soluble fiber and can help in coronary heart disease. Barley listed as eligible sources of beta-glucan soluble fiber include whole grain barley (dehulled or hulless), and certain dry milled barley products, i.e., pearl, flakes, grits, meal, flour, beta-glucan enriched meal fractions and bran and will now be eligible for health claim.
Meat Consumption in US on the rise
It is projected that the per capita meat consumption in US will increase in coming years. Looking at a two year trend the major increase is expected in broiler meat consumption which is increase from 38.23 kg in 2004 to 38.64 kg in 2005 and further jump to 39.46 in 2006. Consumption of pork is expected to decrease from 23.26 kg in 2004 to 22.54 kg in 2005 and increase little bit to 22.67 kg in 2006. Beef consumption is also expected to decrease from 29.98 kg in 2004 to 29.89 kg in 2005 and again increase to 30.70 kg in 2006.
The reason for the increase in consumption of poultry meat is attributed to healthy eating and shift to white meat, which can be converted into more versatile convenient products.
The total meat (red and poultry) is expected to decrease marginally from 100.37 kg in 2004 to 99.83 kg in 2005 and increase further to 101.51 in 2006.
In India per capita broiler meat availability was 1.65 kg in 2004, which is projected to increase to 1.78 kg in 2005 and further increase to 1.89 kg in 2006. This is based on the increase in the broiler population by 10% per year.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
December 23, 2005
As we enter the last week of the year 2005, it seems the corn prices are going to end on a high note. Looking at the prices same time last year, corn was traded at the market yards across the states on an average all India value of Rs.5251 ($118) per MT, while this year same time the average all India price is Rs.5805 ($129) per MT. This price is about 10.55% higher than last year at the market yard.
Just to compare prices of some varieties in the third week of Dec 2004 and Dec 2005
Deshi Red $ 125 in Dec 2004 and $ 135 in Dec 2005
Yellow $ 125 in Dec 2005 and $ 132 in Dec 2005 (it reached $142 on 21 Dec 2005)
Uttar Pradesh, which at one time produced a sizable crop, reports a down trend and the crop is expected to be down by approximately 35%. Other states which are expected to produce less than last year are Rajasthan (down by 30%), Punjab (down by 35%), Gujarat (down by 12%). The only states which have produced more than last year are Andhra Pradesh (up by 38%) and Karnataka (up by 40%), but these high productions are not enough to cover the gap. Despite the increase in production in these two states, the prices of corn are ruling higher in Andhra Pradesh as well as Karnataka, indicating a higher demand from other states.
While in the world situation, USDA has increased the corn export number for China from 3 MMT to 6 MMT, but this has not decreased the grain prices in China. Grain output in China is expected to have jumped by more than 10 million metric tons to over 480 million tons, as per the National Development and Reform Commission. It is reported that a favorable weather also boosted the bumper crop last year.
Grain yield is expected to average 4.449 tons a hectare from 2001 to 2005, higher than 4.424 tons during the 1995-2000 period.
Profitability in grain planting in China has decreased this year due to rising prices for agricultural inputs, such as fertilizer, but it still can be regarded as one of the best years, judging by historical standards
Health benefits from Barley
There are two main types of dietary fiber - soluble and insoluble. The main difference between the two is how they move through the digestive tract. Insoluble fiber, also known as roughage, moves through the digestive tract mostly undisolved. Soluble fiber (beta glucan) mixes with liquid and binds to fatty substances to help remove them from the body.
Studies show soluble fiber (beta glucan) is effective in lowering blood cholesterol and has also been shown to be beneficial in slowing the absorption of sugar, which, for people with diabetes, may help decrease the need for insulin. Barley and oats are the only two edible grains that contain significant levels of beta glucan.
Studies show that insoluble fiber is beneficial in lowering the risk of bowel disorders and colon cancer.
The U.S. Food and Drug Administration (FDA) announced that barley consumption can help reduce coronary heart disease. Whole grain barley and certain dry milled barley grain products are appropriate sources of beta-glucan soluble fiber and can help in coronary heart disease. Barley listed as eligible sources of beta-glucan soluble fiber include whole grain barley (dehulled or hulless), and certain dry milled barley products, i.e., pearl, flakes, grits, meal, flour, beta-glucan enriched meal fractions and bran and will now be eligible for health claim.
Meat Consumption in US on the rise
It is projected that the per capita meat consumption in US will increase in coming years. Looking at a two year trend the major increase is expected in broiler meat consumption which is increase from 38.23 kg in 2004 to 38.64 kg in 2005 and further jump to 39.46 in 2006. Consumption of pork is expected to decrease from 23.26 kg in 2004 to 22.54 kg in 2005 and increase little bit to 22.67 kg in 2006. Beef consumption is also expected to decrease from 29.98 kg in 2004 to 29.89 kg in 2005 and again increase to 30.70 kg in 2006.
The reason for the increase in consumption of poultry meat is attributed to healthy eating and shift to white meat, which can be converted into more versatile convenient products.
The total meat (red and poultry) is expected to decrease marginally from 100.37 kg in 2004 to 99.83 kg in 2005 and increase further to 101.51 in 2006.
In India per capita broiler meat availability was 1.65 kg in 2004, which is projected to increase to 1.78 kg in 2005 and further increase to 1.89 kg in 2006. This is based on the increase in the broiler population by 10% per year.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
December 23, 2005
Saturday, December 17, 2005
Commodity prices show no sign of relenting; Properly cooked poultry meat does not pose a threat of AI infection; Will it help to register poultry floc
Commodity prices show no sign of relenting
The commodity prices in India show no signs of relenting. The demand of corn is up as the placement of poultry is up. As demand of processed food, paper and pharmaceuticals is also on the rise, the demand from the starch sector is also going up, putting pressure on prices.
The prices on Friday, Dec 16, 2005 for some of the varieties were as under:
Deshi Red, Rs.6130 ($138) per MT; Gajjar, Rs.5440 ($122) per MT; Hybrid Yellow, Rs.6320 $142) per MT; Kesari, Rs.6050 ($136) per MT. The above prices are at the market yard will need to add another 12-16% on top to cover cost of packing, transport etc. Last year same time the average price was Rs.5500 ($ 124) per MT. This year the prices are higher by 8%.
Barley requirement too has shown an uptrend, with large breweries coming to India. By a conservative estimate the requirement of the malt sector is about 250,000 – 300,000 tons per year. The current prices at market yard are ranging from Rs.8620 – Rs.8960 ($194 - $201) per MT. Last year same time the average price was Rs.6770 ($ 152) per MT. This year the price is about 29% higher tan last year. The industry also believes that the production of barley was much lower than 1.4 MMT as estimated by Government of India, which has pushed the prices much higher. With still three and a half months to go before the new crop comes in, it will be the survival of the fittest for the malting sector as the prices will tend to go up.
Most of the end users for barley and corn are of the opinion that prices this year started on a higher note and are likely to remain higher in coming months.
Commodity prices in US moves little higher. Corn for March delivery closes at $2.07 per bushel ($81.47 per MT) a tad higher than Dec 09 close of $80.28 per MT. For May delivery corn closed at $85.01 per MT a little higher than Dec 09 close of $83.72 per MT.
Properly cooked poultry meat does not pose a threat of AI infection
Reports from WHO and other organizations indicate Avian Influenza though is effecting more of poultry birds in Asia, it won't be a worldwide threat until the virus is able to spread easily from person to person. It is not a monster as it is made to be.
In order that a pandemic starts, three things must happen:
* Development of a new strain/sub starin of virus
* Its spread to humans and causing serious illness, and
* Its easy spread in humans
The current strain of the virus currently effecting Asia and parts of Europe has made the first two steps, but has not shown to move to the third step as per the experts. It has so far infected about 130 people and in the last 2 years some 70 people have dies due to the infection.
At present there is no pandemic like situation anywhere in the world and the virus does not spread easily between people. Almost all of the human cases have involved people who had direct contact with infected birds and may have had a low immune response.
In order to ally any fears amongst the consumers about avian influenza, FAO and WHO have said that it is safe to eat chicken and other poultry products when they are properly cooked.
As per the report, there is no risk that consumers will be exposed to the virus via the handling or consumption of poultry or poultry products within any areas where there is no avian influenza outbreak in poultry.
Cooking of poultry (e.g., chicken, ducks, geese, turkeys and guinea-fowl) at or above 70°Celsius throughout the product, so that absolutely no meat remains raw and red, is a safe measure. To date there is no epidemiological evidence that people have become infected even after eating contaminated poultry meat that has been properly cooked.
Reports available confirm that human cases of avian influenza acquired their infection during the home slaughtering and subsequent handling of diseased or dead birds prior to cooking. FAO and WHO emphasize that in the process of killing and preparing a live bird for food, slaughtering poses the greatest risk of passing the virus from infected or diseased birds to humans.
Most strains of avian influenza virus are mainly found in the respiratory and gastrointestinal tracts of infected birds--and not in the meat. However, highly pathogenic viruses, such as the H5N1 strain, spread to virtually all parts of an infected bird, including meat. Proper cooking at temperatures at or above 70°C in all parts of the product inactivates the virus.
When a diseased bird is slaughtered, defeathered and eviscerated, virus from the bird can transfer to humans through direct contact. Infected poultry excrete virus in their secretions and feces. Exposure might also occur when the virus is inhaled through dust and possibly through contact with surfaces contaminated with the virus.
In areas where marketing of live birds is common, the practices of home slaughtering, defeathering, and eviscerating increase the exposure to potentially contaminated parts of a chicken. These practices, therefore, result in a significant risk of infection in areas with outbreaks in poultry.
Recommended good hygienic practices to reduce exposure to the virus in areas with outbreaks in poultry include:
* No birds from flocks with disease should enter the food chain.
* Do not eat raw poultry parts, including raw blood, or raw eggs in or from areas with outbreaks in poultry.
* Separate raw meat from cooked or ready-to-eat foods to avoid contamination.
* Do not use the same chopping board or the same knife.
* Do not handle both raw and cooked foods without washing your hands in between, and do not place cooked meat back on the same plate or surface it was on prior to cooking.
* Do not use raw or soft-boiled eggs in food preparations that will not be heat treated or cooked.
* Keep clean and wash your hands. After handling frozen or thawed raw poultry or eggs, wash your hands thoroughly with soap. Wash and disinfect all surfaces and utensils that have been in contact with the raw meat.
* Cook thoroughly: Thorough cooking of poultry meat will inactivate the virus. Either ensure that the poultry meat reaches 70°C at the center of the product ("piping" hot) or that the meat is not pink in any part. Egg yolks should not be runny or liquid.
Will it help to register poultry flocks and farms?
In order to safeguard the interest of farmers and the consumers and also maintain the growth of the industry, will it help if the poultry farms and flocks are registered? The question has been asked many times in India and possibly the answer every time has been, it may not be possible to do it when the farmers are small and un-organized.
United Kingdom has started a campaign and plans to register all flocks, which will help in gathering the information about birds on commercial premises to get a better picture of size, type and proximity of flocks. In UK, even those keeping 50 birds on commercial scale will need to register their flocks by February 2006.
In India, a plan was mooted in 1996 and the registration of parent farms and hatcheries was started, but was a non starter. In order to get a correct picture of the production capabilities, it will be a good idea to start the registration of integrated operations, wherein the parent company provides the information about their contract growers along with the capacity and location. The individual farmers can be asked to register their farms and flocks in the second phase. The registration would do three things:
1. Provide a correct picture on the placements
2. Will be easy to project raw material requirements
3. Could help in managing any potential disease threat
If you have any comments on this topic, please feel free to send the same to me
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
December 17, 2005
The commodity prices in India show no signs of relenting. The demand of corn is up as the placement of poultry is up. As demand of processed food, paper and pharmaceuticals is also on the rise, the demand from the starch sector is also going up, putting pressure on prices.
The prices on Friday, Dec 16, 2005 for some of the varieties were as under:
Deshi Red, Rs.6130 ($138) per MT; Gajjar, Rs.5440 ($122) per MT; Hybrid Yellow, Rs.6320 $142) per MT; Kesari, Rs.6050 ($136) per MT. The above prices are at the market yard will need to add another 12-16% on top to cover cost of packing, transport etc. Last year same time the average price was Rs.5500 ($ 124) per MT. This year the prices are higher by 8%.
Barley requirement too has shown an uptrend, with large breweries coming to India. By a conservative estimate the requirement of the malt sector is about 250,000 – 300,000 tons per year. The current prices at market yard are ranging from Rs.8620 – Rs.8960 ($194 - $201) per MT. Last year same time the average price was Rs.6770 ($ 152) per MT. This year the price is about 29% higher tan last year. The industry also believes that the production of barley was much lower than 1.4 MMT as estimated by Government of India, which has pushed the prices much higher. With still three and a half months to go before the new crop comes in, it will be the survival of the fittest for the malting sector as the prices will tend to go up.
Most of the end users for barley and corn are of the opinion that prices this year started on a higher note and are likely to remain higher in coming months.
Commodity prices in US moves little higher. Corn for March delivery closes at $2.07 per bushel ($81.47 per MT) a tad higher than Dec 09 close of $80.28 per MT. For May delivery corn closed at $85.01 per MT a little higher than Dec 09 close of $83.72 per MT.
Properly cooked poultry meat does not pose a threat of AI infection
Reports from WHO and other organizations indicate Avian Influenza though is effecting more of poultry birds in Asia, it won't be a worldwide threat until the virus is able to spread easily from person to person. It is not a monster as it is made to be.
In order that a pandemic starts, three things must happen:
* Development of a new strain/sub starin of virus
* Its spread to humans and causing serious illness, and
* Its easy spread in humans
The current strain of the virus currently effecting Asia and parts of Europe has made the first two steps, but has not shown to move to the third step as per the experts. It has so far infected about 130 people and in the last 2 years some 70 people have dies due to the infection.
At present there is no pandemic like situation anywhere in the world and the virus does not spread easily between people. Almost all of the human cases have involved people who had direct contact with infected birds and may have had a low immune response.
In order to ally any fears amongst the consumers about avian influenza, FAO and WHO have said that it is safe to eat chicken and other poultry products when they are properly cooked.
As per the report, there is no risk that consumers will be exposed to the virus via the handling or consumption of poultry or poultry products within any areas where there is no avian influenza outbreak in poultry.
Cooking of poultry (e.g., chicken, ducks, geese, turkeys and guinea-fowl) at or above 70°Celsius throughout the product, so that absolutely no meat remains raw and red, is a safe measure. To date there is no epidemiological evidence that people have become infected even after eating contaminated poultry meat that has been properly cooked.
Reports available confirm that human cases of avian influenza acquired their infection during the home slaughtering and subsequent handling of diseased or dead birds prior to cooking. FAO and WHO emphasize that in the process of killing and preparing a live bird for food, slaughtering poses the greatest risk of passing the virus from infected or diseased birds to humans.
Most strains of avian influenza virus are mainly found in the respiratory and gastrointestinal tracts of infected birds--and not in the meat. However, highly pathogenic viruses, such as the H5N1 strain, spread to virtually all parts of an infected bird, including meat. Proper cooking at temperatures at or above 70°C in all parts of the product inactivates the virus.
When a diseased bird is slaughtered, defeathered and eviscerated, virus from the bird can transfer to humans through direct contact. Infected poultry excrete virus in their secretions and feces. Exposure might also occur when the virus is inhaled through dust and possibly through contact with surfaces contaminated with the virus.
In areas where marketing of live birds is common, the practices of home slaughtering, defeathering, and eviscerating increase the exposure to potentially contaminated parts of a chicken. These practices, therefore, result in a significant risk of infection in areas with outbreaks in poultry.
Recommended good hygienic practices to reduce exposure to the virus in areas with outbreaks in poultry include:
* No birds from flocks with disease should enter the food chain.
* Do not eat raw poultry parts, including raw blood, or raw eggs in or from areas with outbreaks in poultry.
* Separate raw meat from cooked or ready-to-eat foods to avoid contamination.
* Do not use the same chopping board or the same knife.
* Do not handle both raw and cooked foods without washing your hands in between, and do not place cooked meat back on the same plate or surface it was on prior to cooking.
* Do not use raw or soft-boiled eggs in food preparations that will not be heat treated or cooked.
* Keep clean and wash your hands. After handling frozen or thawed raw poultry or eggs, wash your hands thoroughly with soap. Wash and disinfect all surfaces and utensils that have been in contact with the raw meat.
* Cook thoroughly: Thorough cooking of poultry meat will inactivate the virus. Either ensure that the poultry meat reaches 70°C at the center of the product ("piping" hot) or that the meat is not pink in any part. Egg yolks should not be runny or liquid.
Will it help to register poultry flocks and farms?
In order to safeguard the interest of farmers and the consumers and also maintain the growth of the industry, will it help if the poultry farms and flocks are registered? The question has been asked many times in India and possibly the answer every time has been, it may not be possible to do it when the farmers are small and un-organized.
United Kingdom has started a campaign and plans to register all flocks, which will help in gathering the information about birds on commercial premises to get a better picture of size, type and proximity of flocks. In UK, even those keeping 50 birds on commercial scale will need to register their flocks by February 2006.
In India, a plan was mooted in 1996 and the registration of parent farms and hatcheries was started, but was a non starter. In order to get a correct picture of the production capabilities, it will be a good idea to start the registration of integrated operations, wherein the parent company provides the information about their contract growers along with the capacity and location. The individual farmers can be asked to register their farms and flocks in the second phase. The registration would do three things:
1. Provide a correct picture on the placements
2. Will be easy to project raw material requirements
3. Could help in managing any potential disease threat
If you have any comments on this topic, please feel free to send the same to me
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
December 17, 2005
Tuesday, December 13, 2005
Indian agriculture scenario and commodity prices; Why is there growth in biotech crops in US – A study
Indian agriculture scenario and commodity prices
Reports indicate a dip in agriculture production. From an average of 4.7 percent growth in the eighth five year plan in agriculture, the growth in agriculture has dipped to 1.2 percent in the first three years of the tenth five year plan (2002-2007). Also if reports are correct, there has been a steep decrease in the number of people involved in agriculture. In 1971 almost 71 percent of the population was engaged in cultivation, in 1991 it dropped to 66 percent in in 2002 only 60 percent of the Indian population is engaged in cultivation. This is based on a National sample survey Organizations household and liability survey 2005.
As the agriculture production is dependent on monsoon, which has been playing taunt last year, reports indicate, India may not have enough wheat to fulfil the requirements of its growing population. Analysts believe India would need to import almost 2 MMT of wheat by April 2006 to cover the deficit. If one goes by the record, Food Corporation of India (FCI) will start the fiscal year 2006 in April with just 1 MMT in its godowns as against 4 MMT as per the norms.
Food Corporation of India (FCI) and Ministry of Agriculture have always maintained that there is a healthy situation on the wheat front and FCI has taken a position on Chicago Board of Trade (CBOT). The big question though is, if imports of wheat do happen as the commodity is required, will the duty be removed? Currently wheat imports attract a duty of 50 percent. Current prices of wheat in South India, are Rs.10,500 ($245) per MT.
As FCI has taken a future potion on wheat and will possibly import, there could be possibility to import maize also as GOI should not be averse to import these commodities to safeguard the interest of end-users (poultry farmers and starch manufacturers) and the consumers. The price of maize is going up and current prices at Nizamabad are ruling at Rs.5600 ($126) per MT. AT various other markets like Bangalore, Hyderabad and south India, the prices are close to Rs.5800 ($130) per MT. The red variety and kesari variety are available in the range of Rs.5800 ($130) to Rs.6125 ($137) per MT at the market yard.
Looking at the US prices, the markets closed at $2.0375 per bushel ($80.20 per MT) on Dec -09, a little higher than the $79.88 per MT on Dec 02. The FOB prices for Dec/Jan delivery was $102 per MT (US Gulf), while the FOB (PNW) was $115 per MR for the same. In 2005, the US corn crop is the second largest in the history.
More details about US commodity prices are available at
http://www.grains.org/buying/market_perspectives/mp_12-09-05.pdf
Why is there growth in biotech crops in US – A study
A study conducted by US National centre for Food and Agriculture Policy indicates that the US farmers are adopting biotechnology derived crop varieties with greater confidence and ease as these crop increase the benefits to the farmers, environment and the consumers.
In 2004, a total of 118 million acres (47.2 million ha) was planted by US farmers, an increase of 11% over 2003. The study examined six biotech crops planted in the United States in 2004 — maize, soybeans, cotton, papaya, canola and squash — and the study is based on data from the U.S. Department of Agriculture's, National Agricultural Statistics Service (NASS) and surveys of crop specialists.
Environmentally, biotech crops also reduced pesticide use by 34%, (7,000 tonnes) over 2003. Their adoption increased the food production by 3 million tons, providing an additional $ 2.3 billion to the net returns to US growers.
According to the study, insect-resistant crops produced the greatest yield increase among the crops studied. While insect-resistant traits increased production, herbicide-resistant varieties generated the greatest reduction in production costs by reducing the amount of pesticide needed and lowering costs associated with hand weeding and mechanical cultivation. herbicide-resistant varieties cut costs by U.S.$1.8 billion and reduced pesticide use.
It is not only the economic and production benefits that accrue from the biotech crops, it is also reduced the need to plow the fields (using no-till method), thus leaving there soil undisturbed, reducing soil erosion and pesticide run-off.
The complete study, "Biotechnology-Derived Crops Planted in 2004 — Impacts on U.S. Agriculture," which came out in early Dec 20005 can be found at
http://www.ncfap.org/whatwedo/pdf/2004biotechimpacts.pdf
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
December 12, 2005
Reports indicate a dip in agriculture production. From an average of 4.7 percent growth in the eighth five year plan in agriculture, the growth in agriculture has dipped to 1.2 percent in the first three years of the tenth five year plan (2002-2007). Also if reports are correct, there has been a steep decrease in the number of people involved in agriculture. In 1971 almost 71 percent of the population was engaged in cultivation, in 1991 it dropped to 66 percent in in 2002 only 60 percent of the Indian population is engaged in cultivation. This is based on a National sample survey Organizations household and liability survey 2005.
As the agriculture production is dependent on monsoon, which has been playing taunt last year, reports indicate, India may not have enough wheat to fulfil the requirements of its growing population. Analysts believe India would need to import almost 2 MMT of wheat by April 2006 to cover the deficit. If one goes by the record, Food Corporation of India (FCI) will start the fiscal year 2006 in April with just 1 MMT in its godowns as against 4 MMT as per the norms.
Food Corporation of India (FCI) and Ministry of Agriculture have always maintained that there is a healthy situation on the wheat front and FCI has taken a position on Chicago Board of Trade (CBOT). The big question though is, if imports of wheat do happen as the commodity is required, will the duty be removed? Currently wheat imports attract a duty of 50 percent. Current prices of wheat in South India, are Rs.10,500 ($245) per MT.
As FCI has taken a future potion on wheat and will possibly import, there could be possibility to import maize also as GOI should not be averse to import these commodities to safeguard the interest of end-users (poultry farmers and starch manufacturers) and the consumers. The price of maize is going up and current prices at Nizamabad are ruling at Rs.5600 ($126) per MT. AT various other markets like Bangalore, Hyderabad and south India, the prices are close to Rs.5800 ($130) per MT. The red variety and kesari variety are available in the range of Rs.5800 ($130) to Rs.6125 ($137) per MT at the market yard.
Looking at the US prices, the markets closed at $2.0375 per bushel ($80.20 per MT) on Dec -09, a little higher than the $79.88 per MT on Dec 02. The FOB prices for Dec/Jan delivery was $102 per MT (US Gulf), while the FOB (PNW) was $115 per MR for the same. In 2005, the US corn crop is the second largest in the history.
More details about US commodity prices are available at
http://www.grains.org/buying/market_perspectives/mp_12-09-05.pdf
Why is there growth in biotech crops in US – A study
A study conducted by US National centre for Food and Agriculture Policy indicates that the US farmers are adopting biotechnology derived crop varieties with greater confidence and ease as these crop increase the benefits to the farmers, environment and the consumers.
In 2004, a total of 118 million acres (47.2 million ha) was planted by US farmers, an increase of 11% over 2003. The study examined six biotech crops planted in the United States in 2004 — maize, soybeans, cotton, papaya, canola and squash — and the study is based on data from the U.S. Department of Agriculture's, National Agricultural Statistics Service (NASS) and surveys of crop specialists.
Environmentally, biotech crops also reduced pesticide use by 34%, (7,000 tonnes) over 2003. Their adoption increased the food production by 3 million tons, providing an additional $ 2.3 billion to the net returns to US growers.
According to the study, insect-resistant crops produced the greatest yield increase among the crops studied. While insect-resistant traits increased production, herbicide-resistant varieties generated the greatest reduction in production costs by reducing the amount of pesticide needed and lowering costs associated with hand weeding and mechanical cultivation. herbicide-resistant varieties cut costs by U.S.$1.8 billion and reduced pesticide use.
It is not only the economic and production benefits that accrue from the biotech crops, it is also reduced the need to plow the fields (using no-till method), thus leaving there soil undisturbed, reducing soil erosion and pesticide run-off.
The complete study, "Biotechnology-Derived Crops Planted in 2004 — Impacts on U.S. Agriculture," which came out in early Dec 20005 can be found at
http://www.ncfap.org/whatwedo/pdf/2004biotechimpacts.pdf
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
December 12, 2005
Saturday, November 26, 2005
High maize prices in India will affect competitiveness; Biotech becoming popular in developing countries
High maize prices in India will affect competitiveness
While most of the corn grain has been harvested, the prices still remain higher, indicating a lower corn crop than anticipated. The southern belt has been receiving excessive rains for the last few days, which might affect Rabi sowing, specially in Tamil Nadu.
With some hurried calculations done, Tamil Nadu’s poultry industry requires over 1.2 MMT of corn, while the production this year is expected to be 0.6 MMT of which 0.48 MMT will be in Rabi, the pressure will be on Karnataka and Andhra Pradesh to fulfil the requirements of maize in Tamil Nadu for its growing broiler and layer sector. With Gujarat, West Bengal also putting pressure on Andhra and Karnataka, prices are bound to go up in the near future.
The indicative prices at some of the varieties were as under:
Deshi Red, Rs.6200 ($139) per MT; Hybrid, Rs.6100 ($137) per MT; Local, Rs.5750 ($129) per MT; Kesari, Rs.5800 ($130) per MT; Yellow Rs.5575 ($125) per MT. In Cuddapah (AP), the prices of Deshi Red variety sold for an average price of Rs.6500 ($146) per MT, despite arrivals of over 1300 tons of material on Friday. In Maharahstra the average price at the markets was Rs.5640 ($126) per MT, while in Tamil Nadu the average price was Rs.5720 ($129) per MT. In Udamulpet, the hub of integration, the corn price at the market was Rs.6100 ($137) per MT.
In 2004 (Nov 26), the indicative prices in Andhra Pradesh was Rs.4990 ($112) per MT. This year the price increase is almost Rs.300 per ton, almost 6%. In Tamil Nadu the price was Rs.4810 ($108) per MT and the increase this year has been Rs.910 per MT, almost 19%.
It is unlikely that the prices are going to come down in near future, and increased demand and low supplies will give rise to speculation and certainly some sort of hoarding which will further increase the price of the commodity. With demand increasing and supplies low, the end users in the poultry, starch sector are in for tough times as their businesses cannot be run without corn.
For poultry it is one of the most vital ingredient and its low supplies, high prices will certainly affect the profitability of small farmers, feed millers and integrators in the long run. The starch sector too is increasing its capacities as the starch and other value added products are much in demand. A price beyond Rs.6000 ($135) per MT, delivered to the starch mill would reduce the profitability and affect the competitiveness of the products in the world market.
There has been much hype about making India a hub for processed food, but it must be seen that if Indian businesses have to scale such heights, the raw materials must be made available at reasonable prices without any restrictions.
In the US the CBOT closed at $1.896 per bushel ($74.62 per MT) for December delivery, almost $0.73 per MT lower than Nov 18, 2005 closing. March delivery closed at $ 2.026 per bushel ($79.74 per MT).
Biotech becoming popular in developing countries
As the population increases the Asia, specially India and China, the countries are bound to adapt biotechnology to feed its growing populations and the opposition is to biotech food crops like rice is likely to dissipate. As per Dr.Gurdev Singh Kush, a consultant to International Rice Research Institute (IRRI) and a World Food Prize recipient in an interview stated that some day GM rice will be approved in Asia. As per reports available, the number of rice consumers is likely to increase to 4 billion by 2030 and almost 70% of the rice consumers live in Asia.
China, India and the Philippines are pushing research on a few varieties of biotech rice containing the BT gene, which is resistant to the corn borer pest, the leading destroyer of corn crops in Asia.
Other biotech rice, containing the Xa21 gene which is resistant to the bacterial blight pest and golden rice rich in Vitamin A, are also being studied and may be released in comming years.
Iran on the other hand has claimed to be the first country to commercialize GM rice in 2004 after nearly 10 years of risk assessment, including field trials.
As Mr.Clive James, Chairman and founder of International Service for the Acquisition of Agri-biotech Applications (ISAAA), puts it, 'While the West argues, the developing world is planting biotech crops'
GM crops are being embraced in developing countries much faster and there is a greater interest in high-yielding, pest-resistant crops that can increase productivity and profits to the farmers.
In 2003 the number of developing countries growing biotech crops was 6, while in 2004, it increased to 11, almost double. As per ISAAA, More than 34 per cent of the global biotech crop area of 81 million hectares last year was grown in developing countries.
The benefits accrued to producers from biotech crops in 2003 in US were $1.9 billion, while in Argentina in 2001-02, the gains were to the tune of $1.7 billion. In 2010, China expects the gains to be $1billion from Bt Cotton and $4 billion from GM rice.
In India, it has been fours years since biotech cotton was introduced and the sales of transgenic seeds has jumped by over 30 times since than, if reports are to be believed. After the initial success, Monsanto plans to introduce Bt Cotton with 2 genes, which it claims will be 10 times more effective. Bollgard II, as it has been named is in its final year of field trials and will be released in the next season.
With GM Cotton and GM Rice is the forefront of the adoption in India and China, it is likely that the gains from the technology will be huge and benefit the small farmers in developing countries immensely and will also make them competitive in the world market. A study by Australian economists, predicts that the grains by biotech grains, oil seeds and fruit and vegetables would amount to $210 billion by 2015. This projection has been based on a full adoption with 10 per cent productivity gains in high and middle-income countries, and 20 per cent in low-income countries.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 26, 2005
While most of the corn grain has been harvested, the prices still remain higher, indicating a lower corn crop than anticipated. The southern belt has been receiving excessive rains for the last few days, which might affect Rabi sowing, specially in Tamil Nadu.
With some hurried calculations done, Tamil Nadu’s poultry industry requires over 1.2 MMT of corn, while the production this year is expected to be 0.6 MMT of which 0.48 MMT will be in Rabi, the pressure will be on Karnataka and Andhra Pradesh to fulfil the requirements of maize in Tamil Nadu for its growing broiler and layer sector. With Gujarat, West Bengal also putting pressure on Andhra and Karnataka, prices are bound to go up in the near future.
The indicative prices at some of the varieties were as under:
Deshi Red, Rs.6200 ($139) per MT; Hybrid, Rs.6100 ($137) per MT; Local, Rs.5750 ($129) per MT; Kesari, Rs.5800 ($130) per MT; Yellow Rs.5575 ($125) per MT. In Cuddapah (AP), the prices of Deshi Red variety sold for an average price of Rs.6500 ($146) per MT, despite arrivals of over 1300 tons of material on Friday. In Maharahstra the average price at the markets was Rs.5640 ($126) per MT, while in Tamil Nadu the average price was Rs.5720 ($129) per MT. In Udamulpet, the hub of integration, the corn price at the market was Rs.6100 ($137) per MT.
In 2004 (Nov 26), the indicative prices in Andhra Pradesh was Rs.4990 ($112) per MT. This year the price increase is almost Rs.300 per ton, almost 6%. In Tamil Nadu the price was Rs.4810 ($108) per MT and the increase this year has been Rs.910 per MT, almost 19%.
It is unlikely that the prices are going to come down in near future, and increased demand and low supplies will give rise to speculation and certainly some sort of hoarding which will further increase the price of the commodity. With demand increasing and supplies low, the end users in the poultry, starch sector are in for tough times as their businesses cannot be run without corn.
For poultry it is one of the most vital ingredient and its low supplies, high prices will certainly affect the profitability of small farmers, feed millers and integrators in the long run. The starch sector too is increasing its capacities as the starch and other value added products are much in demand. A price beyond Rs.6000 ($135) per MT, delivered to the starch mill would reduce the profitability and affect the competitiveness of the products in the world market.
There has been much hype about making India a hub for processed food, but it must be seen that if Indian businesses have to scale such heights, the raw materials must be made available at reasonable prices without any restrictions.
In the US the CBOT closed at $1.896 per bushel ($74.62 per MT) for December delivery, almost $0.73 per MT lower than Nov 18, 2005 closing. March delivery closed at $ 2.026 per bushel ($79.74 per MT).
Biotech becoming popular in developing countries
As the population increases the Asia, specially India and China, the countries are bound to adapt biotechnology to feed its growing populations and the opposition is to biotech food crops like rice is likely to dissipate. As per Dr.Gurdev Singh Kush, a consultant to International Rice Research Institute (IRRI) and a World Food Prize recipient in an interview stated that some day GM rice will be approved in Asia. As per reports available, the number of rice consumers is likely to increase to 4 billion by 2030 and almost 70% of the rice consumers live in Asia.
China, India and the Philippines are pushing research on a few varieties of biotech rice containing the BT gene, which is resistant to the corn borer pest, the leading destroyer of corn crops in Asia.
Other biotech rice, containing the Xa21 gene which is resistant to the bacterial blight pest and golden rice rich in Vitamin A, are also being studied and may be released in comming years.
Iran on the other hand has claimed to be the first country to commercialize GM rice in 2004 after nearly 10 years of risk assessment, including field trials.
As Mr.Clive James, Chairman and founder of International Service for the Acquisition of Agri-biotech Applications (ISAAA), puts it, 'While the West argues, the developing world is planting biotech crops'
GM crops are being embraced in developing countries much faster and there is a greater interest in high-yielding, pest-resistant crops that can increase productivity and profits to the farmers.
In 2003 the number of developing countries growing biotech crops was 6, while in 2004, it increased to 11, almost double. As per ISAAA, More than 34 per cent of the global biotech crop area of 81 million hectares last year was grown in developing countries.
The benefits accrued to producers from biotech crops in 2003 in US were $1.9 billion, while in Argentina in 2001-02, the gains were to the tune of $1.7 billion. In 2010, China expects the gains to be $1billion from Bt Cotton and $4 billion from GM rice.
In India, it has been fours years since biotech cotton was introduced and the sales of transgenic seeds has jumped by over 30 times since than, if reports are to be believed. After the initial success, Monsanto plans to introduce Bt Cotton with 2 genes, which it claims will be 10 times more effective. Bollgard II, as it has been named is in its final year of field trials and will be released in the next season.
With GM Cotton and GM Rice is the forefront of the adoption in India and China, it is likely that the gains from the technology will be huge and benefit the small farmers in developing countries immensely and will also make them competitive in the world market. A study by Australian economists, predicts that the grains by biotech grains, oil seeds and fruit and vegetables would amount to $210 billion by 2015. This projection has been based on a full adoption with 10 per cent productivity gains in high and middle-income countries, and 20 per cent in low-income countries.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 26, 2005
Saturday, November 19, 2005
Maize prices in India on the rise and US production surges; Vertical integration is the best bet against bird flu threat
Maize prices in India on the rise and US production surges
It seems there is no respite from increasing commodity prices in India, especially corn, which is the third most important coarse cereal in India, and is used by poultry, starch and the livestock sector. As its demand has gone up, the production has not been able to keep pace, due to several factors which include adoption of hybrid seeds, inputs costs and prices of competitive crops which can be grown in the same area among the few.
Current prices in India for some specific varieties are much higher than the Minimum Support Price (MSP) declared by Government of India. Some indicative prices are as under:
Deshi Red, Rs.6400 ($144) per MT; Hybrid Yellow, Rs.6125 ($138) per MT; Kesari, Rs.5900 ($133) per MT; Medium, Rs.5500 ($124) per MT. The prices of the same varieties in Oct 2005 was lower by an average of Rs.534 ($12) per MT at the market level, thus making the commodities more expensive at the fag end of the harvest.
In US, corn closed lower on CBOT on Nov 18 at $1.91 ($75.35) for Dec corn, lower by almost $2.27 from Nov 11, 2005 for Dec corn. FOB value for December delivery was indicated at $98 per MT, while for January 2005 the FOB value (US Gulf) was indicated at $99.50 per MT.
The freight has also shown a decline is the last 2 weeks. Even the values for domestic freght in US have declined.
Detailed market report from US Grains Council can be found at:
http://www.grains.org/buying/market_perspectives/mp_11-18-05.pdf
The WASDE report, out on Nov 10, 2005 predicted a higher corn production in the US. The production is now estimated at 11.03 billion bushels (280.2 MMT), up from 10.857 billion bushels (275.8 MMT) estimated in Oct 2005. The usage in food feed and industrial sector has also been increased to 75.2 MMT of which 40 MMT is estimated to be used for ethanol production. Report also predicts the average farm price to be in the range of $1.60 – 2.00 per bushel ($62.97 – 78.72) per MT. (The above price is the weighted average price received by the US corn farmer).
Vertical integration is the best bet against bird flu threat
Poultry specialists at the Purdue University, have stated that the business model of poultry industry is the key component in preventing the outbreak. All commercial poultry in US is company managed – under vertical integration and the processes are safer and more efficient. And having full control over the entire production process is probably a good thing.
Poultry production is big business in the United States. In 2004 the combined production value of broilers, eggs, turkeys and sales from chickens was $28.9 billion, according to the U.S. Department of Agriculture. Of that total value, 71 percent came from broilers, 18 percent from eggs and 11 percent from turkeys.
Under a vertically integrated system, a company owns parent stock - the males and females - that lay the hatchable eggs, which are transferred to a company-owned hatchery. It is possible that the parent stock could be on a contract farm and the company would likely own the birds on that farm, provide them feed and supply technical expertise to help that producer rear those birds.
Once a bird is hatched from the company-owned hatchery, it is usually transported to another contracted producer. At the end of the production period, the company comes and collects the birds from that farm and takes them to a processing facility that they own themselves or to the market.
Bio-security measures are tight throughout the production process, especially on the parent farms and hatcheries. Typical levels of bio-security include limiting visitors onto the farm and limiting the transfer of equipment from one farm to another.
By limiting visitors and equipment transfer, it is possible to limit possible routes of infection. Most producers go to great lengths to limit other sources of vectors that may transmit diseases, including rodents, flies and wild birds.
In India too, poultry is big business, valued at $6.5 billion, providing employment opportunities to almost 3 million people, directly or indirectly. Almost 80 percent of poultry production business in integrated in Southern India, while in West India, integration is limited to 40 percent. In east India almost 20 percent of the poultry production business in integrated, while in North India only 10 percent in under integration.
Many companies do see bird flu as a business risk, specially in South East Asia. Businesses in SEA have issued warnings to investors that earnings could get affected. But that is all part of the game.
More than 60 human deaths have been attributed to avian influenza, and four outbreaks have been reported in the past two weeks in China, where authorities have reportedly destroyed 2.5 million birds to contain the virus.
In order to keep the consumers informed about the disease, National Chicken Council, National Turkey Federation and Egg Safety Centre have come together to launch a website www.avianinfluenzainfo.com. The key message is "Avian influenza: It's not in your food" The avian influenza virus is not food borne and cannot survive heat.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 19, 2005
It seems there is no respite from increasing commodity prices in India, especially corn, which is the third most important coarse cereal in India, and is used by poultry, starch and the livestock sector. As its demand has gone up, the production has not been able to keep pace, due to several factors which include adoption of hybrid seeds, inputs costs and prices of competitive crops which can be grown in the same area among the few.
Current prices in India for some specific varieties are much higher than the Minimum Support Price (MSP) declared by Government of India. Some indicative prices are as under:
Deshi Red, Rs.6400 ($144) per MT; Hybrid Yellow, Rs.6125 ($138) per MT; Kesari, Rs.5900 ($133) per MT; Medium, Rs.5500 ($124) per MT. The prices of the same varieties in Oct 2005 was lower by an average of Rs.534 ($12) per MT at the market level, thus making the commodities more expensive at the fag end of the harvest.
In US, corn closed lower on CBOT on Nov 18 at $1.91 ($75.35) for Dec corn, lower by almost $2.27 from Nov 11, 2005 for Dec corn. FOB value for December delivery was indicated at $98 per MT, while for January 2005 the FOB value (US Gulf) was indicated at $99.50 per MT.
The freight has also shown a decline is the last 2 weeks. Even the values for domestic freght in US have declined.
Detailed market report from US Grains Council can be found at:
http://www.grains.org/buying/market_perspectives/mp_11-18-05.pdf
The WASDE report, out on Nov 10, 2005 predicted a higher corn production in the US. The production is now estimated at 11.03 billion bushels (280.2 MMT), up from 10.857 billion bushels (275.8 MMT) estimated in Oct 2005. The usage in food feed and industrial sector has also been increased to 75.2 MMT of which 40 MMT is estimated to be used for ethanol production. Report also predicts the average farm price to be in the range of $1.60 – 2.00 per bushel ($62.97 – 78.72) per MT. (The above price is the weighted average price received by the US corn farmer).
Vertical integration is the best bet against bird flu threat
Poultry specialists at the Purdue University, have stated that the business model of poultry industry is the key component in preventing the outbreak. All commercial poultry in US is company managed – under vertical integration and the processes are safer and more efficient. And having full control over the entire production process is probably a good thing.
Poultry production is big business in the United States. In 2004 the combined production value of broilers, eggs, turkeys and sales from chickens was $28.9 billion, according to the U.S. Department of Agriculture. Of that total value, 71 percent came from broilers, 18 percent from eggs and 11 percent from turkeys.
Under a vertically integrated system, a company owns parent stock - the males and females - that lay the hatchable eggs, which are transferred to a company-owned hatchery. It is possible that the parent stock could be on a contract farm and the company would likely own the birds on that farm, provide them feed and supply technical expertise to help that producer rear those birds.
Once a bird is hatched from the company-owned hatchery, it is usually transported to another contracted producer. At the end of the production period, the company comes and collects the birds from that farm and takes them to a processing facility that they own themselves or to the market.
Bio-security measures are tight throughout the production process, especially on the parent farms and hatcheries. Typical levels of bio-security include limiting visitors onto the farm and limiting the transfer of equipment from one farm to another.
By limiting visitors and equipment transfer, it is possible to limit possible routes of infection. Most producers go to great lengths to limit other sources of vectors that may transmit diseases, including rodents, flies and wild birds.
In India too, poultry is big business, valued at $6.5 billion, providing employment opportunities to almost 3 million people, directly or indirectly. Almost 80 percent of poultry production business in integrated in Southern India, while in West India, integration is limited to 40 percent. In east India almost 20 percent of the poultry production business in integrated, while in North India only 10 percent in under integration.
Many companies do see bird flu as a business risk, specially in South East Asia. Businesses in SEA have issued warnings to investors that earnings could get affected. But that is all part of the game.
More than 60 human deaths have been attributed to avian influenza, and four outbreaks have been reported in the past two weeks in China, where authorities have reportedly destroyed 2.5 million birds to contain the virus.
In order to keep the consumers informed about the disease, National Chicken Council, National Turkey Federation and Egg Safety Centre have come together to launch a website www.avianinfluenzainfo.com. The key message is "Avian influenza: It's not in your food" The avian influenza virus is not food borne and cannot survive heat.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 19, 2005
Monday, November 14, 2005
Maize prices ruling high in India; Socks made out of Corn; Indian broiler sector has the potential, but for raw material availability
Maize prices ruling high in India
Even though the harvest of Khariff crop is almost over and farmers are getting ready for Rabi sowing in most parts of the country, the maize prices are much higher than last year. Market reports reveal feed millers and starch manufacturers are procuring maize delivered at their site at Rs.7000 ($157) per ton. There are reports that the prices in states like Uttar Pradesh, Rajasthan and Gujarat are very high and most of North India procures maize from these states. It is believed that the maize crop in Uttar Pradesh was affected due to drought at the start and later due to untimely rains.
Reports from some parts of Andhra Pradesh indicate that almost 30% of the crop has been damaged due to un-timely rains and government of India has also relaxed the rules of Fair Average Quality (FAQ), the basis on which it procures grain from the market. It would mean that lower quality grains would also be picked by the agencies at the same price at good quality.
Production estimates have been worked out by various agencies and trading companies. Based on market information, it is estimated that the production of Maize in Khariff is about 9.4 – 9.6 MMT and during Rabi it is expected to be 2.5 – 2.6 MMT due to high soil moisture and good irrigation that would be available during the season. With a demand of over 13.8 MMT and production at 12.1 – 12.2 MMT, the prices are bound to remain higher.
Some current price indications are Red – Rs.6000 ($ 134.8), Gajjar Rs.5700 ($128), Hyb/Local Rs.5975 ($134.3), Yellow 5250 ($118) per MT. The prices are at market yards and costs like commission, packing, loading and transport, will need be added.
In parts of Andhra Pradesh where though crop is higher than last year, rain damage has affected the quality. The damaged grain is of no use for the poultry industry, but can be used by the starch sector, under special circumstances.
In parts of Karnataka too, the same story is unfolding. Maize with high moisture content was being brought in the markets.
Due to the increased price of maize , the feed pries are likely to increase in near future which will affect the profitability not only of the small farmers but large integrators as well. Though India is the second lowest cost producer of broiler in the world, it may lose out if the commodity prices remain high.
In US the prices remained firm and there was no change in prices as on last week. Dec corn closed at $77.62 per MT, while March corn closed at $82.65. The US rail and barge rates declined and this has also helped in firming the prices in domestic markets. The FOB rates Dec corn is $97.5 per MT while Jan corn was $99 per MT.
Detailed market report from US Grains Council can be found at:
http://www.grains.org/buying/market_perspectives/mp_11-11-05.pdf
Socks made out of Corn
The environmental benefits of biodegradable fibers are one of the selling points for a new line of socks introduced this week in Japan. The socks promoted by North Carolina's Harriss & Covington Hosiery Mills, is made out of Ingeo fiber, a corn-based bioplastic from NatureWorks, in place of petroleum-based fibers. Ingeo fibre, is the 'world's first man-made fibre' produced from corn extrusion. The bioplastic fibers offer excellent wicking, moisture management and comfort properties, in addition to being biodegradable under appropriate conditions. The hosiery line, which includes running, walking, climbing, cycling, golf and specialty children’s socks, will be available in 2006. If the new line of socks is successful in Japan, the manufactures may market them in Europe and the United States. (photo courtesy: www.yahoo.com)
Indian broiler sector has the potential, but for raw material availability
The Indian broiler industry which has been growing at about 10% per annum, can grow much faster, provided the inputs are available at reasonable prices.
It will be possible to provide safe, high quality chicken to the consumers at affordable prices. The new food law and the amendment to the Meat Food Products Order of 1973 will make it possible for the companies to promote processed poultry to the consumers and increase its demand.
But if the prices of raw material, especially maize fluctuates, it will difficult for the poultry farmers to keep the cost of production down. With the current feed price of Rs.11 per kg ($0.24) in South India the cost of production of a kg of live chicken is Rs.27.67 ($0.62) (at farm gate). An increase of Rs.1 in feed price is likely to increase the cost of production to Rs.29.47 ($66) per kg. i.e., a Rs.1 increase in feed causes the cost of production to increase by Rs.1.8 for 1 kg of live chicken, thus reducing the profit margin of the farms by the same amount on a kg of chicken.
If feed millers are buying maize at over Rs.6500 ($146) per ton during the harvest, the traders predict the prices to hit Rs.7500 ($166) per MT in summer time, which is likely to affect the profitability still further. There have been instances in the past when increased prices of raw materials and low profitability have forced many farmers to close farms and look for alternate jobs. It is high time that Government of India considers a policy to make available maize at a reasonable price by way of own production or by way of imports. It is a way to bridge the gap between supply and demand. The supply in 2005-06 is expected to be 12.2 MMT and the demand likely to touch 13.73 MMT and could be more of poultry exports start in a big way to Japan.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 12, 2005
Even though the harvest of Khariff crop is almost over and farmers are getting ready for Rabi sowing in most parts of the country, the maize prices are much higher than last year. Market reports reveal feed millers and starch manufacturers are procuring maize delivered at their site at Rs.7000 ($157) per ton. There are reports that the prices in states like Uttar Pradesh, Rajasthan and Gujarat are very high and most of North India procures maize from these states. It is believed that the maize crop in Uttar Pradesh was affected due to drought at the start and later due to untimely rains.
Reports from some parts of Andhra Pradesh indicate that almost 30% of the crop has been damaged due to un-timely rains and government of India has also relaxed the rules of Fair Average Quality (FAQ), the basis on which it procures grain from the market. It would mean that lower quality grains would also be picked by the agencies at the same price at good quality.
Production estimates have been worked out by various agencies and trading companies. Based on market information, it is estimated that the production of Maize in Khariff is about 9.4 – 9.6 MMT and during Rabi it is expected to be 2.5 – 2.6 MMT due to high soil moisture and good irrigation that would be available during the season. With a demand of over 13.8 MMT and production at 12.1 – 12.2 MMT, the prices are bound to remain higher.
Some current price indications are Red – Rs.6000 ($ 134.8), Gajjar Rs.5700 ($128), Hyb/Local Rs.5975 ($134.3), Yellow 5250 ($118) per MT. The prices are at market yards and costs like commission, packing, loading and transport, will need be added.
In parts of Andhra Pradesh where though crop is higher than last year, rain damage has affected the quality. The damaged grain is of no use for the poultry industry, but can be used by the starch sector, under special circumstances.
In parts of Karnataka too, the same story is unfolding. Maize with high moisture content was being brought in the markets.
Due to the increased price of maize , the feed pries are likely to increase in near future which will affect the profitability not only of the small farmers but large integrators as well. Though India is the second lowest cost producer of broiler in the world, it may lose out if the commodity prices remain high.
In US the prices remained firm and there was no change in prices as on last week. Dec corn closed at $77.62 per MT, while March corn closed at $82.65. The US rail and barge rates declined and this has also helped in firming the prices in domestic markets. The FOB rates Dec corn is $97.5 per MT while Jan corn was $99 per MT.
Detailed market report from US Grains Council can be found at:
http://www.grains.org/buying/market_perspectives/mp_11-11-05.pdf
Socks made out of Corn
The environmental benefits of biodegradable fibers are one of the selling points for a new line of socks introduced this week in Japan. The socks promoted by North Carolina's Harriss & Covington Hosiery Mills, is made out of Ingeo fiber, a corn-based bioplastic from NatureWorks, in place of petroleum-based fibers. Ingeo fibre, is the 'world's first man-made fibre' produced from corn extrusion. The bioplastic fibers offer excellent wicking, moisture management and comfort properties, in addition to being biodegradable under appropriate conditions. The hosiery line, which includes running, walking, climbing, cycling, golf and specialty children’s socks, will be available in 2006. If the new line of socks is successful in Japan, the manufactures may market them in Europe and the United States. (photo courtesy: www.yahoo.com)
Indian broiler sector has the potential, but for raw material availability
The Indian broiler industry which has been growing at about 10% per annum, can grow much faster, provided the inputs are available at reasonable prices.
It will be possible to provide safe, high quality chicken to the consumers at affordable prices. The new food law and the amendment to the Meat Food Products Order of 1973 will make it possible for the companies to promote processed poultry to the consumers and increase its demand.
But if the prices of raw material, especially maize fluctuates, it will difficult for the poultry farmers to keep the cost of production down. With the current feed price of Rs.11 per kg ($0.24) in South India the cost of production of a kg of live chicken is Rs.27.67 ($0.62) (at farm gate). An increase of Rs.1 in feed price is likely to increase the cost of production to Rs.29.47 ($66) per kg. i.e., a Rs.1 increase in feed causes the cost of production to increase by Rs.1.8 for 1 kg of live chicken, thus reducing the profit margin of the farms by the same amount on a kg of chicken.
If feed millers are buying maize at over Rs.6500 ($146) per ton during the harvest, the traders predict the prices to hit Rs.7500 ($166) per MT in summer time, which is likely to affect the profitability still further. There have been instances in the past when increased prices of raw materials and low profitability have forced many farmers to close farms and look for alternate jobs. It is high time that Government of India considers a policy to make available maize at a reasonable price by way of own production or by way of imports. It is a way to bridge the gap between supply and demand. The supply in 2005-06 is expected to be 12.2 MMT and the demand likely to touch 13.73 MMT and could be more of poultry exports start in a big way to Japan.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 12, 2005
Monday, November 07, 2005
Commodity prices in India and US; Biotech – spreading its wings; It’s final – Frozen Chicken in MFPO net
Commodity prices in India and US
The last week in India was the festival week. The week started with Deepawali, the festival of lights on Tuesday and ended with EID on Friday. Most markets were subdued and arrivals very slow.
Yellow corn averaged at Rs.5500 ($124) per MT while the local corn average at Rs.5600 ($126) per MT. The spot price at Davangere (Karnataka) was reported at Rs.5322 ($120) per MT while in Nizamabad (Andhra Pradesh) the price was Rs.5348 ($121) per MT.
The prices during the same period last year (first week of November 2004) were much lower. Prices in Andhra Pradesh last year were $90 – 100 per MT while in Bangalore were $115 per MT.
The harvest in US is almost complete and 80% of the crop has been harvested. The prices have also come down as per last week and Dec corn closed at $1.955 per bushel ($77.62 per MT), The corresponding FOB value is $98.5 per MT. March corn closed at $2.0975 per bushel ($ 82.65 per MT). In India the future prices for February are Rs.5640 ($127) per MT. That will be the time when the Rabi crop will be harvested in some parts of the country, specially in Bihar and parts of Karnataka and Andhra Pradesh.
Detailed market report from US Grains Council can be found at:
http://www.grains.org/buying/market_perspectives/mp_11-04-05.pdf
Biotech – spreading its wings
A report in farmers weekly says that the farmers in UK are losing out on agriculture as they are not allowed to plant any biotech crops. Farmers from UK visited Spain to study the system and found nothing wrong with the system. Spain, as per the reports, plants 11% of its area under biotech maize. The technology behind biotech maize prevents corn borer damage and saves at least two insecticide treatments, bringing down the cost of production.
As per the farmers from UK, a herbicide resistant biotech sugar beet could significantly reduce production costs to offset some of the severe price cuts in the proposed reforms.
While the farmers in UK are frustrated on not being allowed to use the technology to compete in the world, farmers in Czech Republic will be growing biotech corn this year, which will be hitting the market by 2006. The corn, which is more resistant to disease-bearing pests, is expected to be used in the country's animal feed industry.
Reports available suggest France and Portugal in Europe have also begun commercial growing of biotech maize this year. Spain and Germany are already growing biotech maize. The European Union has long imported biotech products from United States, but only this year the laws have been amended on the Continent's agriculture industry to enable countries to decide whether to allow the growing of biotech crops.
The EU currently allows only biotech maize to be grown, but it could also give a green light to modified potatoes and rapeseed down the line. Observers say farmers are turning to the crop to save money: Better harvests would cut production losses caused by disease and lower the costs of chemically protecting crops.
In lighter vain, some observers point out all those who oppose biotech crops travel on business or as tourists in areas of the world where they eat these products and do not raise any questions. In addition they bring packed food from those areas which, is not labelled and that this is the best clinical trial and opinion trial that one can have.
It’s final – Frozen Chicken in MFPO net
The final notification made on Oct 27, 2005 by Ministry of Food Processing Industries, Government of India is an amendment to the Meat Food Products Order of 1973. With this amendment frozen chicken and fish are included in the products that would need a licence to be sold in India. Plants processing chicken and selling frozen chicken would need to register themselves with Ministry of Food Processing Industries (MoFPI) and obtain a licence. The licence number would need to appear on the package of frozen chicken as it now appears on the packs of value added products. In the new amendment, the chilled chicken registration has been kept on a voluntary basis as this is the start will be made compulsory at a leter date.
Until recently chicken (frozen or chilled) was not included in the list of MFPO products. The notification is a step in a right direction and will help in creating confidence among the consumers and increase acceptance of dressed/packed chicken.
U S Grains Council has been involved with the poultry processing sector in India for last 3 years and has recently completed the training of Ministry of Food Processing Industry inspectors and production managers of major processing plants in India. The training will help the production managers produce a better product and will also help the inspectors implement the notification.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 05, 2005
The last week in India was the festival week. The week started with Deepawali, the festival of lights on Tuesday and ended with EID on Friday. Most markets were subdued and arrivals very slow.
Yellow corn averaged at Rs.5500 ($124) per MT while the local corn average at Rs.5600 ($126) per MT. The spot price at Davangere (Karnataka) was reported at Rs.5322 ($120) per MT while in Nizamabad (Andhra Pradesh) the price was Rs.5348 ($121) per MT.
The prices during the same period last year (first week of November 2004) were much lower. Prices in Andhra Pradesh last year were $90 – 100 per MT while in Bangalore were $115 per MT.
The harvest in US is almost complete and 80% of the crop has been harvested. The prices have also come down as per last week and Dec corn closed at $1.955 per bushel ($77.62 per MT), The corresponding FOB value is $98.5 per MT. March corn closed at $2.0975 per bushel ($ 82.65 per MT). In India the future prices for February are Rs.5640 ($127) per MT. That will be the time when the Rabi crop will be harvested in some parts of the country, specially in Bihar and parts of Karnataka and Andhra Pradesh.
Detailed market report from US Grains Council can be found at:
http://www.grains.org/buying/market_perspectives/mp_11-04-05.pdf
Biotech – spreading its wings
A report in farmers weekly says that the farmers in UK are losing out on agriculture as they are not allowed to plant any biotech crops. Farmers from UK visited Spain to study the system and found nothing wrong with the system. Spain, as per the reports, plants 11% of its area under biotech maize. The technology behind biotech maize prevents corn borer damage and saves at least two insecticide treatments, bringing down the cost of production.
As per the farmers from UK, a herbicide resistant biotech sugar beet could significantly reduce production costs to offset some of the severe price cuts in the proposed reforms.
While the farmers in UK are frustrated on not being allowed to use the technology to compete in the world, farmers in Czech Republic will be growing biotech corn this year, which will be hitting the market by 2006. The corn, which is more resistant to disease-bearing pests, is expected to be used in the country's animal feed industry.
Reports available suggest France and Portugal in Europe have also begun commercial growing of biotech maize this year. Spain and Germany are already growing biotech maize. The European Union has long imported biotech products from United States, but only this year the laws have been amended on the Continent's agriculture industry to enable countries to decide whether to allow the growing of biotech crops.
The EU currently allows only biotech maize to be grown, but it could also give a green light to modified potatoes and rapeseed down the line. Observers say farmers are turning to the crop to save money: Better harvests would cut production losses caused by disease and lower the costs of chemically protecting crops.
In lighter vain, some observers point out all those who oppose biotech crops travel on business or as tourists in areas of the world where they eat these products and do not raise any questions. In addition they bring packed food from those areas which, is not labelled and that this is the best clinical trial and opinion trial that one can have.
It’s final – Frozen Chicken in MFPO net
The final notification made on Oct 27, 2005 by Ministry of Food Processing Industries, Government of India is an amendment to the Meat Food Products Order of 1973. With this amendment frozen chicken and fish are included in the products that would need a licence to be sold in India. Plants processing chicken and selling frozen chicken would need to register themselves with Ministry of Food Processing Industries (MoFPI) and obtain a licence. The licence number would need to appear on the package of frozen chicken as it now appears on the packs of value added products. In the new amendment, the chilled chicken registration has been kept on a voluntary basis as this is the start will be made compulsory at a leter date.
Until recently chicken (frozen or chilled) was not included in the list of MFPO products. The notification is a step in a right direction and will help in creating confidence among the consumers and increase acceptance of dressed/packed chicken.
U S Grains Council has been involved with the poultry processing sector in India for last 3 years and has recently completed the training of Ministry of Food Processing Industry inspectors and production managers of major processing plants in India. The training will help the production managers produce a better product and will also help the inspectors implement the notification.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
November 05, 2005
Monday, October 31, 2005
Commodity prices and storage; No Avian Flu, but awareness is the key
Commodity prices and storage
As the harvest in US progressed and reports suggest about 65% of the corn as harvested, the prices have tended to come down. Dec corn at CBOT was reported at $1.97 per bushel (($77.62 per MT), lower by about $1.78 per MT from last week. The FOB value for Dec corn was $101 per MT. For more details click on the link below.
http://www.grains.org/buying/market_perspectives/mp_10-28-05.pdf
In India, though the harvest is in full swing, but the corn prices are still higher. The Red corn variety available in Rajasthan, parts of Uttar Pradesh and parts of Andhra Pradesh was selling at Rs.6030 ($135) per MT. The yellow variety which is preferred by the poultry and cattle sector was selling at Rs.5500 – Rs.6170 ($123 - $138) per MT at the market place. The spot prices in Nizamabad (Andhra Pradesh) are reported at Rs.5387 ($121) per MT, while in Davangere (Karnataka) the prices were reported at Rs.5315 ($119) per MT.
In most of the south Indian markets the corn which is coming into the markets has high moisture content and is being sold at a discount. With more rains in the coastal areas of Andhra Pradesh, Tamil Nadu and also in parts of Karnataka storage of corn could pose a major problem in these areas. Poultry industry would prefer corn at a moisture content of 11- 12% as it can be stored easily. Corn with high moisture, when stored in bags, without any aeration tends to spoil due to presence of a fungus and the toxin Aflatoxin, which is harmful for poultry, cattle and humans alike.
The inflation hit a high of 4.71% last week due to increased prices of corn, gram, fruits, vegetables and manufactured items. As per RBI if the current trend of high prices continues it will be difficult to reign in the inflation at 5.5%, the RBI set barrier. Last year same time the inflation was 8%.
No Avian Flu, but awareness is the key
There is no bird flu in India and Government of India has set the system in motion of surveillance and testing for avian flu. Poultry Diagnostics and Research Centre (PDRC) — an autonomous research and diseases surveillance wing of the Venkateshwara Hatcheries (VH) Group has signed and agreement with Lasher Associates Inc, US, and Bombay Natural History Society (BNHS) for testing of migratory birds for bird flu. On the other side the Department of Animal Husbandry, Ministry of Heath, Ministry of Environment and forest are all coordinating the efforts on preparedness for the eventuality.
As per FAO, consumer responses to potential bird flu outbreaks are already having a disruptive impact on industries in Europe and beyond. In Europe the reaction has been mixed, for example in Germany there has been no change while consumption of poultry in Italy has declined by 40 percent. India learnt a bitter lesson in early 2004 when the consumption of eggs and chicken dropped due to panic only and the industry suffered a loss of over Rs.3000 crores ($675 million). At present there are no reports of any demand drop in Delhi market.
The market receives about 120 vehicles a day (96,000 to 100,000 birds) a day. Delhi’s demand is about 240,000 – 250,000 birds / day and almost 40% comes to the Delhi Poultry Market.
According to FAO, recent outbreaks of transboundary diseases and the imposition of disease-related export restrictions had an immediate impact on global meat trade in the 2004/2005. International meat prices, as represented in the FAO meat price index, which is calculated using trade-weighted indicative international prices, have risen to 10-year highs.
FAO has reminded consumers that avian influenza is not a food-borne disease and that the bird flu virus is killed by the heat of normal cooking. "There is no risk of getting avian influenza from properly cooked poultry and eggs." It is duty of the government and the industry to create awareness amongst the consumers who consume poultry meat and eggs and give this message.
http://www.fao.org/newsroom/en/news/2005/108286/index.html
It is also for the consumers to be aware and demand a clean, hygienic product from the industry and shops which sell chicken. Regulation of live markets would be a good point to start and Delhi Agricultural Marketing Board (DAMB) has already started its cleanliness drive, much before the avian flu fear can up. Plans are afoot to set up a state of the art poultry processing plant at live market.
But before that happens, a clean shed for the poultry slaughter has been provided, a security gate and room for the veterinarian have been erected. The veterinarian, on deputation from the Municipal Corporation of Delhi or Delhi Government will be responsible for ante-mortem and post-mortem of the poultry birds slaughtered here. A barricade has been erected to check any unauthorized entry into the premises.
India does not have any bird flu and this can be an advantage for the Indian poultry industry. Japanese government has cleared some of the poultry processing plants in India. Egg powder from India has already created a niche in the Japanese market.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 31, 2005
As the harvest in US progressed and reports suggest about 65% of the corn as harvested, the prices have tended to come down. Dec corn at CBOT was reported at $1.97 per bushel (($77.62 per MT), lower by about $1.78 per MT from last week. The FOB value for Dec corn was $101 per MT. For more details click on the link below.
http://www.grains.org/buying/market_perspectives/mp_10-28-05.pdf
In India, though the harvest is in full swing, but the corn prices are still higher. The Red corn variety available in Rajasthan, parts of Uttar Pradesh and parts of Andhra Pradesh was selling at Rs.6030 ($135) per MT. The yellow variety which is preferred by the poultry and cattle sector was selling at Rs.5500 – Rs.6170 ($123 - $138) per MT at the market place. The spot prices in Nizamabad (Andhra Pradesh) are reported at Rs.5387 ($121) per MT, while in Davangere (Karnataka) the prices were reported at Rs.5315 ($119) per MT.
In most of the south Indian markets the corn which is coming into the markets has high moisture content and is being sold at a discount. With more rains in the coastal areas of Andhra Pradesh, Tamil Nadu and also in parts of Karnataka storage of corn could pose a major problem in these areas. Poultry industry would prefer corn at a moisture content of 11- 12% as it can be stored easily. Corn with high moisture, when stored in bags, without any aeration tends to spoil due to presence of a fungus and the toxin Aflatoxin, which is harmful for poultry, cattle and humans alike.
The inflation hit a high of 4.71% last week due to increased prices of corn, gram, fruits, vegetables and manufactured items. As per RBI if the current trend of high prices continues it will be difficult to reign in the inflation at 5.5%, the RBI set barrier. Last year same time the inflation was 8%.
No Avian Flu, but awareness is the key
There is no bird flu in India and Government of India has set the system in motion of surveillance and testing for avian flu. Poultry Diagnostics and Research Centre (PDRC) — an autonomous research and diseases surveillance wing of the Venkateshwara Hatcheries (VH) Group has signed and agreement with Lasher Associates Inc, US, and Bombay Natural History Society (BNHS) for testing of migratory birds for bird flu. On the other side the Department of Animal Husbandry, Ministry of Heath, Ministry of Environment and forest are all coordinating the efforts on preparedness for the eventuality.
As per FAO, consumer responses to potential bird flu outbreaks are already having a disruptive impact on industries in Europe and beyond. In Europe the reaction has been mixed, for example in Germany there has been no change while consumption of poultry in Italy has declined by 40 percent. India learnt a bitter lesson in early 2004 when the consumption of eggs and chicken dropped due to panic only and the industry suffered a loss of over Rs.3000 crores ($675 million). At present there are no reports of any demand drop in Delhi market.
The market receives about 120 vehicles a day (96,000 to 100,000 birds) a day. Delhi’s demand is about 240,000 – 250,000 birds / day and almost 40% comes to the Delhi Poultry Market.
According to FAO, recent outbreaks of transboundary diseases and the imposition of disease-related export restrictions had an immediate impact on global meat trade in the 2004/2005. International meat prices, as represented in the FAO meat price index, which is calculated using trade-weighted indicative international prices, have risen to 10-year highs.
FAO has reminded consumers that avian influenza is not a food-borne disease and that the bird flu virus is killed by the heat of normal cooking. "There is no risk of getting avian influenza from properly cooked poultry and eggs." It is duty of the government and the industry to create awareness amongst the consumers who consume poultry meat and eggs and give this message.
http://www.fao.org/newsroom/en/news/2005/108286/index.html
It is also for the consumers to be aware and demand a clean, hygienic product from the industry and shops which sell chicken. Regulation of live markets would be a good point to start and Delhi Agricultural Marketing Board (DAMB) has already started its cleanliness drive, much before the avian flu fear can up. Plans are afoot to set up a state of the art poultry processing plant at live market.
But before that happens, a clean shed for the poultry slaughter has been provided, a security gate and room for the veterinarian have been erected. The veterinarian, on deputation from the Municipal Corporation of Delhi or Delhi Government will be responsible for ante-mortem and post-mortem of the poultry birds slaughtered here. A barricade has been erected to check any unauthorized entry into the premises.
India does not have any bird flu and this can be an advantage for the Indian poultry industry. Japanese government has cleared some of the poultry processing plants in India. Egg powder from India has already created a niche in the Japanese market.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 31, 2005
Saturday, October 22, 2005
Of commodity prices and bird flu; Technologies that can help; Poultry industry can grow faster if supported
Of commodity prices and bird flu
In the US the harvest is proceeding and about 49% of the crop has been harvested. The prices are going down slowly. Dec corn on 21 Oct, closed at $2.015 per bushel ($79.40 per MT). a little lowerthan last week (Oct 14) close of $2.035 per bushel ($80.18 per MT). The FOB value (US Gulf) was reported at $104 per MT.
For more details follow the link
http://www.grains.org/buying/market_perspectives.html
In India the arrivals of corn are still slow. Reports in a section of press indicate a higher maize production in Andhra Pradesh, while market reports do not support the argument. Arrivals in most of the markets are very slow except in Cuddaph, where the arrivals were over 500 tons on Oct 21. The price was Rs.5890 ($132) per MT. The spot prices in Nizamabad were reported at Rs.5490 ($123) per MT.
Prices in Bihar are showing a rising trend and stocks are depleting. Rannebannur, in Karnataka saw a spurt in arrivals, crossing over 3500 tons on Oct 21 with average prices at Rs.5050 ($113) per MT. While in Davangere the arrivals were about 500 tons and the price in the market was reported at Rs.4420 ($100) per MT. The Spot prices in Davangere however were hush higher at Rs.5580 ($125) per MT.
Due to excessive rains in the easten part of the country, severe damage to winter crop has been reported, specially in areas of West Bengal. Even coastal areas of Orissa, Andhra Pradesh have received heavy rainfall.
On the other side, to fight the menace of Bird Flu, a global poultry association, under the name of International Poultry Council (IPC) has been formed. Members include Argentina, Brazil, China, European Union, Mexico, Russia, Thailand and the United States. IPC will work for the common good of the poultry industry on a worldwide scale.
Delegates adopted a charter agreement whose vision and mission statements and list of objectives lays out an ambitious program under which the world’s poultry industries may work cooperatively to resolve issues that affect them all.
List of objectives include provisions to encourage uniform and science-based international sanitary and marketing standards for poultry, to strengthen ties to international animal disease and food safety organizations to name a few.
Even though the organization is brand new, the IPC’s first order of business will be to launch a campaign to dispel the myriad myths and rumors that have come out of the spreading epidemic of highly pathogenic avian influenza (HPAI), or bird flu, which has killed scores of people in Asia and has spread into Russia and, more recently, Europe.
Technologies that can help
Biotechnology as a tool to help the farmers realize the benefits and lower the costs, a positive impact on the environment and the people is one example how technology can help the mankind. Another example is the conversion of corn into bio fuel and bio plastics.
Mankind has been dependent of non renewable resources for long and it is time to realize that these resources are limiting the growth of some economies. With the help of technologies, it will be possible for many countries to use renewable resources and revitalize their ailing economies and environments. Countries like Japan, Taiwan and US have already realized this and have passed legislations and are making use of corn based plastics. But the major problem is in the developing countries where environment degradation due to petroleum based packaging material is posing a major threat.
Companies like Walmart in US are going green and moving towards a more environmentally sensitive product packaging, beginning with containers of strawberries, cut fruit, herbs and brussels sprouts that will be made from corn-based plastic instead of petroleum products.
The first substitution, starting 1st Nov 2005, for four products translates to 114 million clear-plastic clamshell containers used annually. With this change in the packaging, the company will save an estimated 800,000 gallons (3.02 million liters) of gasoline and reduce more than 11 million pounds (4.9 million kg) of greenhouse gas emissions. The company also plans to plans introduce corn based plastic to pack cut vegetables, breads, donuts and also use it in gift cards.
Corn-based plastics decompose in 47 days and can be used for almost every food item, except those that are microwaved. The product breaks down in high heats.
The Corn based plastic called PLA – Poly lactic acid is a product from NatureWorks L.L.C., a Minnesota-based division of Cargill Inc. As per the company, the product is competitively priced with petroleum-based plastic, which is commonly used for soda and water bottles.
A big difference between PLA plastic and its petroleum-based competitors -- beyond its origin in an annually renewable resource -- is PLA's ability to be composted in carefully regulated municipal operations. It is also recyclable, like most other plastics.
Containers and packaging accounted for 32 percent of municipal solid wastes by weight in 2003 in US, according to the Environmental Protection Agency.
There is a need to consider it and it comes at a time of when prices of oil and natural gas, the sources for most plastics, are ratcheting up the cost of plastic materials. Packaging of food products specially is a major issue and in cities like issue Mumbai which was affected by floods could use the green packing material. Hill stations to can follow up and reduce the denuding of the hills and deforestation.
Poultry industry can grow faster if supported
If state governments implement the guidelines issued by the central government on poultry, the sector can grow much faster. Based on the letter sent by Honourable Minister for AGriculture , Shri Sharad Pawar to all the state governments to include poultry under agriculture, Government of Orissa probably is the first state to do so.
In a resolution passed by Department of Agriculture, Government of Orissa on August 10, 2005, poultry farming has been classified as agriculture in the state. The resolution says, “Poultry farmers/entrepreneurs will have access to the same incentives as being offered for agriculture by other concerned departments like Revenue, Finance, Labour, Energy etc”. Such a move will make it possible for farmers to obtain priority lending and incentives from all other departments. This will certainly give a boost to the industry in the state.
If other states can take similar steps, it will help in further growth of the industry, which provides self employment opportunities to the rural youth and contributes heavily in the rural economy. Poultry industry also provides much needed protein in the form of eggs and meat to the rural & urban population and good manure for the farms.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 22, 2005
In the US the harvest is proceeding and about 49% of the crop has been harvested. The prices are going down slowly. Dec corn on 21 Oct, closed at $2.015 per bushel ($79.40 per MT). a little lowerthan last week (Oct 14) close of $2.035 per bushel ($80.18 per MT). The FOB value (US Gulf) was reported at $104 per MT.
For more details follow the link
http://www.grains.org/buying/market_perspectives.html
In India the arrivals of corn are still slow. Reports in a section of press indicate a higher maize production in Andhra Pradesh, while market reports do not support the argument. Arrivals in most of the markets are very slow except in Cuddaph, where the arrivals were over 500 tons on Oct 21. The price was Rs.5890 ($132) per MT. The spot prices in Nizamabad were reported at Rs.5490 ($123) per MT.
Prices in Bihar are showing a rising trend and stocks are depleting. Rannebannur, in Karnataka saw a spurt in arrivals, crossing over 3500 tons on Oct 21 with average prices at Rs.5050 ($113) per MT. While in Davangere the arrivals were about 500 tons and the price in the market was reported at Rs.4420 ($100) per MT. The Spot prices in Davangere however were hush higher at Rs.5580 ($125) per MT.
Due to excessive rains in the easten part of the country, severe damage to winter crop has been reported, specially in areas of West Bengal. Even coastal areas of Orissa, Andhra Pradesh have received heavy rainfall.
On the other side, to fight the menace of Bird Flu, a global poultry association, under the name of International Poultry Council (IPC) has been formed. Members include Argentina, Brazil, China, European Union, Mexico, Russia, Thailand and the United States. IPC will work for the common good of the poultry industry on a worldwide scale.
Delegates adopted a charter agreement whose vision and mission statements and list of objectives lays out an ambitious program under which the world’s poultry industries may work cooperatively to resolve issues that affect them all.
List of objectives include provisions to encourage uniform and science-based international sanitary and marketing standards for poultry, to strengthen ties to international animal disease and food safety organizations to name a few.
Even though the organization is brand new, the IPC’s first order of business will be to launch a campaign to dispel the myriad myths and rumors that have come out of the spreading epidemic of highly pathogenic avian influenza (HPAI), or bird flu, which has killed scores of people in Asia and has spread into Russia and, more recently, Europe.
Technologies that can help
Biotechnology as a tool to help the farmers realize the benefits and lower the costs, a positive impact on the environment and the people is one example how technology can help the mankind. Another example is the conversion of corn into bio fuel and bio plastics.
Mankind has been dependent of non renewable resources for long and it is time to realize that these resources are limiting the growth of some economies. With the help of technologies, it will be possible for many countries to use renewable resources and revitalize their ailing economies and environments. Countries like Japan, Taiwan and US have already realized this and have passed legislations and are making use of corn based plastics. But the major problem is in the developing countries where environment degradation due to petroleum based packaging material is posing a major threat.
Companies like Walmart in US are going green and moving towards a more environmentally sensitive product packaging, beginning with containers of strawberries, cut fruit, herbs and brussels sprouts that will be made from corn-based plastic instead of petroleum products.
The first substitution, starting 1st Nov 2005, for four products translates to 114 million clear-plastic clamshell containers used annually. With this change in the packaging, the company will save an estimated 800,000 gallons (3.02 million liters) of gasoline and reduce more than 11 million pounds (4.9 million kg) of greenhouse gas emissions. The company also plans to plans introduce corn based plastic to pack cut vegetables, breads, donuts and also use it in gift cards.
Corn-based plastics decompose in 47 days and can be used for almost every food item, except those that are microwaved. The product breaks down in high heats.
The Corn based plastic called PLA – Poly lactic acid is a product from NatureWorks L.L.C., a Minnesota-based division of Cargill Inc. As per the company, the product is competitively priced with petroleum-based plastic, which is commonly used for soda and water bottles.
A big difference between PLA plastic and its petroleum-based competitors -- beyond its origin in an annually renewable resource -- is PLA's ability to be composted in carefully regulated municipal operations. It is also recyclable, like most other plastics.
Containers and packaging accounted for 32 percent of municipal solid wastes by weight in 2003 in US, according to the Environmental Protection Agency.
There is a need to consider it and it comes at a time of when prices of oil and natural gas, the sources for most plastics, are ratcheting up the cost of plastic materials. Packaging of food products specially is a major issue and in cities like issue Mumbai which was affected by floods could use the green packing material. Hill stations to can follow up and reduce the denuding of the hills and deforestation.
Poultry industry can grow faster if supported
If state governments implement the guidelines issued by the central government on poultry, the sector can grow much faster. Based on the letter sent by Honourable Minister for AGriculture , Shri Sharad Pawar to all the state governments to include poultry under agriculture, Government of Orissa probably is the first state to do so.
In a resolution passed by Department of Agriculture, Government of Orissa on August 10, 2005, poultry farming has been classified as agriculture in the state. The resolution says, “Poultry farmers/entrepreneurs will have access to the same incentives as being offered for agriculture by other concerned departments like Revenue, Finance, Labour, Energy etc”. Such a move will make it possible for farmers to obtain priority lending and incentives from all other departments. This will certainly give a boost to the industry in the state.
If other states can take similar steps, it will help in further growth of the industry, which provides self employment opportunities to the rural youth and contributes heavily in the rural economy. Poultry industry also provides much needed protein in the form of eggs and meat to the rural & urban population and good manure for the farms.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 22, 2005
Saturday, October 15, 2005
Commodity prices are higher; Biotech crops can help environment; Bio-security, hygienic processing and Bird Flu
Commodity prices are higher
In the middle of October and in the harvest season, the prices of coarse cereals are still rulling higher than normal.
Reports received from various markets indicate fewer arrivals. Bajra (Pearl Millet) arrivals have started in markets of Rajastha, but arruvals are small, indicating higher prices of $135 – 138 per MT. Arrivals of Jowar (Grain Sorghum) have started in Gujarat, Maharashtra, Karnataka and Andhra Pradesh, but smaller amounts. Arrivals of Maize (corn) have started in Andhra Pradesh, but in smaller quanitities. Average prices of yellow corn is $124 - $127 per MT. Spot prices in Nizamabad and Davangere were $124 and $123 per MT.
The farmers in the United States are harvesting the second largest corn crop on record, according to the World Agricultural Supply and Demand Estimates (WASDE report) released by the USDA on Wednesday, October 12. The forecast for U.S. corn production is higher than the previous estimates. The current estimates project the crop size to be 275.79 MMT, higher by 5.56 MMT from Sept 2005 estimates. The report projects that increased supply will be partially absorbed by growth in domestic feed usage (149.23 MMT) and increases in food and industrial uses.
The report also projects the world production of corn at 668.18 MMT in 2005 of which 464.03 MMT will be utilized in feed. The ending stocks will be lower at 111.88 MMT as against last year’s 126.26 MMT.
Chinese corn crop is expected to be 126 MMT of which 100 MMT will be used in feed. China is expected to export about 3 MMT and the ending stocks are expected to be lower by 10.8 MMT at 25.6 MMT from last years 36.4 MMT.
The detailed report can be downloaded from the following link.
http://usda.mannlib.cornell.edu/reports/waobr/wasde-bb/2005/wasde10.pdf
The price of corn in US is under pressure due to higher production reports. Dec corn closed at $2.034 per bushel ($80.05 per MT). March corn closed at $2.1625 per bushel ($85.11 per MT).
Biotech crops can help environment (from Grainnet.com)
A study released on Oct 11, 2005 states “"Since 1996, adoption of biotech crops has contributed to reducing greenhouse gas emissions from agriculture and decreased pesticide spraying,". The adoption of biotech as a tool has helped decreasing the pesticide spraying and environmental footprint associated with pesticide use by 14%, the report says.
The study, "GM crops: the global socio-economic and environmental impact -- the first nine years 1996-2004," reported that biotech crops contributed to significantly reduced greenhouse gas emissions from agricultural practices.
Among the results:
• Farmers reduced fuel consumption by cutting down on the use of machines to apply chemicals and till the soil, saving a total 475 million gallons of fuel
• By not burning this fuel, and by reducing ploughing that allows carbon to escape from the soil, growers cut overall carbon dioxide emissions that could have an impact on global warming. The reduction was equivalent to eliminating 22 billion pounds of carbon dioxide from the atmosphere, which is equivalent to removing 5 million cars from the road for one year. This is one-fifth of cars registered in the United Kingdom
• reduced the volume of pesticide spraying globally by 6 percent since 1996, equivalent to a decrease of 380 million pounds according to the study. That's equivalent to eliminating 1,514 rail cars of pesticide's active ingredient.
• Farm incomes grew by more than $ 27.5 billion, including an $ 8 billion benefit to growers in Argentina. from a combination of enhanced productivity and efficiency gains. This increase in farm income is equivalent to adding 3 percent to 4 percent to the value of global production of the four main biotech crops.
The largest environmental gains from changes in pesticide spraying have been from biotech soybeans and cotton, which have reduced the associated environmental footprint by 19 percent and 17 percent, respectively.
According to the study, the industrialized nations of the United States and Canada, as well as the developing nations of China, South Africa and Argentina, experienced the greatest reductions in the environmental impact of crop production.
"As the world is increasingly focused on the need to reduce greenhouse gas emissions, it is clear biotech crops are already making an important positive contribution to achieving this goal," the report said.
In addition to environmental gains from biotech crops, substantial net economic benefits at the farm level have been realized.
• Herbicide-tolerant soybeans have generated the greatest gains at more than $17 billion in increased income, while biotech cotton farmers improved their income by $6.5 billion in the past nine years.
• Growers in the United States and Argentina have reaped the greatest rewards, each gaining approximately $10 billion in the past nine years, while farmers in China have experienced a $4 billion income increase from planting biotech cotton.
In addition to the significant measurable benefits, valuable indirect benefits that are more difficult to quantify can be credited to biotech crop adoption.
These include increased management flexibility, facilitating reduced tillage practices, reduced production risk and improved crop quality.
More than 8.25 million farmers in 18 countries around the world have adopted biotech crops, and 90 percent of those are resource-poor producers located in developing countries.
This study was compiled based largely on extensive analysis of existing farm-level economic impact data on biotech crops and additional primary analysis of the environmental impact from base data.
While the study showed advantages in US, Argentina, China, India and other developing countries which have adopted biotech crop’s, new reports suggest France has a about 1000 hac of land under biotech corn. Report is several of the newspapers suggest lack of communication between the authorities, farmers and public at large. Most believe this corn will be exported to Spain as biotech corn is growth their and used, but there is no ban on sale in France. Detailed report can be seen at the following link
http://www.fas.usda.gov/gainfiles/200509/146130886.pdf
Bio-security, hygienic processing and Bird Flu
The danger of bird flu lurks around the corner. Though India has no reports of the virus, vigilance is the key. This is the season of migratory birds and farmers in the areas will have to be extra cautious and step up bio-security measures. Using foot baths, sprays and not allowing unwanted people in the sheds would be one way.
Following the threat in Asia, it is perceived that the key to stopping bird flu will be in the rural belts where birds and humans are in much closer contact and wild birds and domestic birds share the land and water. It is a cheek to beak thing in most rural backyard poultries.
An outbreak in these backyard chickens can ruin not only the small farmers, but also large corporations who have large investments.
India, so far is not affected, but it will be necessary to educate the small farmers on bio-security measures and making sure birds are housed inside. It will be one way to minimize the risk.
Indeed, chicken farming in countries such as Vietnam and Cambodia is a haphazard affair compounded by wide ignorance of the danger bird flu poses and the way migratory birds can keep reseeding the virus in areas previously cleared of the disease. The same situation can happen in the backyards of India.
Of the chicken produced in the country (India), only 5% is processed hygienically. In all major and minor towns, on main streets backyard birds (desi) and broilers live side by side in cages waiting for the customer. The birds are dressed (processed) by hand for the customer.
Even in Thailand, which has a vastly more developed poultry industry than its neighbors have, millions of chickens are farmed in still less-than-secure conditions. Eighty percent of birds [in Thailand] are processed safely, but it is the 20% that is causing more worry to the health officials.
It is only in South East Asia’s countryside, where 66 people have died after contracting the virus since late 2003, including 12 in Thailand, health and agriculture experts are concentrating on techniques for safer chicken farming to head off the disease and prevent a pandemic.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 15, 2005
In the middle of October and in the harvest season, the prices of coarse cereals are still rulling higher than normal.
Reports received from various markets indicate fewer arrivals. Bajra (Pearl Millet) arrivals have started in markets of Rajastha, but arruvals are small, indicating higher prices of $135 – 138 per MT. Arrivals of Jowar (Grain Sorghum) have started in Gujarat, Maharashtra, Karnataka and Andhra Pradesh, but smaller amounts. Arrivals of Maize (corn) have started in Andhra Pradesh, but in smaller quanitities. Average prices of yellow corn is $124 - $127 per MT. Spot prices in Nizamabad and Davangere were $124 and $123 per MT.
The farmers in the United States are harvesting the second largest corn crop on record, according to the World Agricultural Supply and Demand Estimates (WASDE report) released by the USDA on Wednesday, October 12. The forecast for U.S. corn production is higher than the previous estimates. The current estimates project the crop size to be 275.79 MMT, higher by 5.56 MMT from Sept 2005 estimates. The report projects that increased supply will be partially absorbed by growth in domestic feed usage (149.23 MMT) and increases in food and industrial uses.
The report also projects the world production of corn at 668.18 MMT in 2005 of which 464.03 MMT will be utilized in feed. The ending stocks will be lower at 111.88 MMT as against last year’s 126.26 MMT.
Chinese corn crop is expected to be 126 MMT of which 100 MMT will be used in feed. China is expected to export about 3 MMT and the ending stocks are expected to be lower by 10.8 MMT at 25.6 MMT from last years 36.4 MMT.
The detailed report can be downloaded from the following link.
http://usda.mannlib.cornell.edu/reports/waobr/wasde-bb/2005/wasde10.pdf
The price of corn in US is under pressure due to higher production reports. Dec corn closed at $2.034 per bushel ($80.05 per MT). March corn closed at $2.1625 per bushel ($85.11 per MT).
Biotech crops can help environment (from Grainnet.com)
A study released on Oct 11, 2005 states “"Since 1996, adoption of biotech crops has contributed to reducing greenhouse gas emissions from agriculture and decreased pesticide spraying,". The adoption of biotech as a tool has helped decreasing the pesticide spraying and environmental footprint associated with pesticide use by 14%, the report says.
The study, "GM crops: the global socio-economic and environmental impact -- the first nine years 1996-2004," reported that biotech crops contributed to significantly reduced greenhouse gas emissions from agricultural practices.
Among the results:
• Farmers reduced fuel consumption by cutting down on the use of machines to apply chemicals and till the soil, saving a total 475 million gallons of fuel
• By not burning this fuel, and by reducing ploughing that allows carbon to escape from the soil, growers cut overall carbon dioxide emissions that could have an impact on global warming. The reduction was equivalent to eliminating 22 billion pounds of carbon dioxide from the atmosphere, which is equivalent to removing 5 million cars from the road for one year. This is one-fifth of cars registered in the United Kingdom
• reduced the volume of pesticide spraying globally by 6 percent since 1996, equivalent to a decrease of 380 million pounds according to the study. That's equivalent to eliminating 1,514 rail cars of pesticide's active ingredient.
• Farm incomes grew by more than $ 27.5 billion, including an $ 8 billion benefit to growers in Argentina. from a combination of enhanced productivity and efficiency gains. This increase in farm income is equivalent to adding 3 percent to 4 percent to the value of global production of the four main biotech crops.
The largest environmental gains from changes in pesticide spraying have been from biotech soybeans and cotton, which have reduced the associated environmental footprint by 19 percent and 17 percent, respectively.
According to the study, the industrialized nations of the United States and Canada, as well as the developing nations of China, South Africa and Argentina, experienced the greatest reductions in the environmental impact of crop production.
"As the world is increasingly focused on the need to reduce greenhouse gas emissions, it is clear biotech crops are already making an important positive contribution to achieving this goal," the report said.
In addition to environmental gains from biotech crops, substantial net economic benefits at the farm level have been realized.
• Herbicide-tolerant soybeans have generated the greatest gains at more than $17 billion in increased income, while biotech cotton farmers improved their income by $6.5 billion in the past nine years.
• Growers in the United States and Argentina have reaped the greatest rewards, each gaining approximately $10 billion in the past nine years, while farmers in China have experienced a $4 billion income increase from planting biotech cotton.
In addition to the significant measurable benefits, valuable indirect benefits that are more difficult to quantify can be credited to biotech crop adoption.
These include increased management flexibility, facilitating reduced tillage practices, reduced production risk and improved crop quality.
More than 8.25 million farmers in 18 countries around the world have adopted biotech crops, and 90 percent of those are resource-poor producers located in developing countries.
This study was compiled based largely on extensive analysis of existing farm-level economic impact data on biotech crops and additional primary analysis of the environmental impact from base data.
While the study showed advantages in US, Argentina, China, India and other developing countries which have adopted biotech crop’s, new reports suggest France has a about 1000 hac of land under biotech corn. Report is several of the newspapers suggest lack of communication between the authorities, farmers and public at large. Most believe this corn will be exported to Spain as biotech corn is growth their and used, but there is no ban on sale in France. Detailed report can be seen at the following link
http://www.fas.usda.gov/gainfiles/200509/146130886.pdf
Bio-security, hygienic processing and Bird Flu
The danger of bird flu lurks around the corner. Though India has no reports of the virus, vigilance is the key. This is the season of migratory birds and farmers in the areas will have to be extra cautious and step up bio-security measures. Using foot baths, sprays and not allowing unwanted people in the sheds would be one way.
Following the threat in Asia, it is perceived that the key to stopping bird flu will be in the rural belts where birds and humans are in much closer contact and wild birds and domestic birds share the land and water. It is a cheek to beak thing in most rural backyard poultries.
An outbreak in these backyard chickens can ruin not only the small farmers, but also large corporations who have large investments.
India, so far is not affected, but it will be necessary to educate the small farmers on bio-security measures and making sure birds are housed inside. It will be one way to minimize the risk.
Indeed, chicken farming in countries such as Vietnam and Cambodia is a haphazard affair compounded by wide ignorance of the danger bird flu poses and the way migratory birds can keep reseeding the virus in areas previously cleared of the disease. The same situation can happen in the backyards of India.
Of the chicken produced in the country (India), only 5% is processed hygienically. In all major and minor towns, on main streets backyard birds (desi) and broilers live side by side in cages waiting for the customer. The birds are dressed (processed) by hand for the customer.
Even in Thailand, which has a vastly more developed poultry industry than its neighbors have, millions of chickens are farmed in still less-than-secure conditions. Eighty percent of birds [in Thailand] are processed safely, but it is the 20% that is causing more worry to the health officials.
It is only in South East Asia’s countryside, where 66 people have died after contracting the virus since late 2003, including 12 in Thailand, health and agriculture experts are concentrating on techniques for safer chicken farming to head off the disease and prevent a pandemic.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 15, 2005
Monday, October 10, 2005
Commodity prices and production update; Biotechnology : Tool to produce healthier fresher products
Commodity prices and production update
Even though the harvest has started in India and small quanities of corn is trinkling in the market yards, the prices of corn are still higher. The prices for some varieties like Deshi Red and Kesari from Gujarat, Rajasthan and Maharashtra are higher and are reported in the range of Rs.6100 – Rs.6220 ($140 - $143) per MT. The highest price for yellow corn was in Gujarat (Rs.6500 - $149) per mt), while the average was around Rs.5500 ($126) per MT.
In most places the crop is delayed due to late rains and the total estimate is about 9.2 – 9.8 MMT in Kharif, while in Rabi the crop is expected to be about 2.4 MMT, limiting the total corn crop at 11.6 – 12.2 MMT for the year 2005-06, against a demand of 13.7 MMT based on the growth of poultry, livestock and starch sector and their requirements.
The corn prices in US are lower as the harvest is moving forward. December corn closed at $79.50 per MT (CBOT) lower by $1.47 per MT from Sept 30. The FOB value for Yellow corn was reported at $97.25 per MT. The freight rates however, are slowly inching up on higher demand and movement of goods.
Biotechnology : Tool to produce healthier fresher products
The corn being bough by you today at the grocery store probably would have less pesticides than the one bought by your mother a decade ago. This is because of the revolution in Biotechnology. The tool has create seeds which are resisiatnt to insects. Seeds are capable of doing what pesticides did once.
Farmers in US are increasingly growing biotech crops and now in EU farmers are adopting the technology as it produces healhier foods having less of pesticides. It is not only the consumer, but also the farmer who benefits as he is exposed to pesticided less number of times, the environment receives less chemicals and with water such a scare commodity in most parts of of the world, any help to reduce chneical contamination would be a welcome step.
In the near future, it will be possible to produce plants which would produce fat free oils and could grow well in stress conditions specially drought.
U S Grains Council has been active in the biotech sector and provding information to the interested groups all over the world and conducting conferences. Fouth in the series, a five day, 2005 Biotech Information Conference starts Oct 10, 2005 and will take the participants through the biotech crop tour, including visits to farms, laboratories and markets. Around 100 participantsincluding government oficials and opinion leaders from around the world will attend the conference including two from India. Dr.G S Toteja, Deputy Director General, Indian Council of Medical Research (ICMR), New Delhi and Dr.P D Dwivedi, Scientist, Indian Toxicology Research Centre (ITRC), Lucknow will represent India and learn about the systems and regulations that have helped the farmers and consumers alike to reap the benefits of the technology. This will also be an opportunity to meet with biotech regulators from other parts of the world including those from Mexico, Africa, Egypt, Saudi Arabia, Bangladesh, Pakistan, Japan, Korea, China, Malaysia, Indonesia to name a few.
In its endeavour to be a provider of factual information, the Council will also be conductiing a Biotech Harvest Tour from Oct 17 – 21, 2005 in this 10th year of biotech, for 18 journalists from 12 countries, incliding one from India. A five-day tour through the Midwest, includes visits to the Chicago Board of Trade, a grain elevator, research and industry facilities and several farms throughout Illinois, Indiana and Ohio. The journalists will observe the management, science and acceptance of agricultural biotechnology in the United States through direct contact with U.S. growers, regulators, academics, researchers and industry.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 10, 2005
Even though the harvest has started in India and small quanities of corn is trinkling in the market yards, the prices of corn are still higher. The prices for some varieties like Deshi Red and Kesari from Gujarat, Rajasthan and Maharashtra are higher and are reported in the range of Rs.6100 – Rs.6220 ($140 - $143) per MT. The highest price for yellow corn was in Gujarat (Rs.6500 - $149) per mt), while the average was around Rs.5500 ($126) per MT.
In most places the crop is delayed due to late rains and the total estimate is about 9.2 – 9.8 MMT in Kharif, while in Rabi the crop is expected to be about 2.4 MMT, limiting the total corn crop at 11.6 – 12.2 MMT for the year 2005-06, against a demand of 13.7 MMT based on the growth of poultry, livestock and starch sector and their requirements.
The corn prices in US are lower as the harvest is moving forward. December corn closed at $79.50 per MT (CBOT) lower by $1.47 per MT from Sept 30. The FOB value for Yellow corn was reported at $97.25 per MT. The freight rates however, are slowly inching up on higher demand and movement of goods.
Biotechnology : Tool to produce healthier fresher products
The corn being bough by you today at the grocery store probably would have less pesticides than the one bought by your mother a decade ago. This is because of the revolution in Biotechnology. The tool has create seeds which are resisiatnt to insects. Seeds are capable of doing what pesticides did once.
Farmers in US are increasingly growing biotech crops and now in EU farmers are adopting the technology as it produces healhier foods having less of pesticides. It is not only the consumer, but also the farmer who benefits as he is exposed to pesticided less number of times, the environment receives less chemicals and with water such a scare commodity in most parts of of the world, any help to reduce chneical contamination would be a welcome step.
In the near future, it will be possible to produce plants which would produce fat free oils and could grow well in stress conditions specially drought.
U S Grains Council has been active in the biotech sector and provding information to the interested groups all over the world and conducting conferences. Fouth in the series, a five day, 2005 Biotech Information Conference starts Oct 10, 2005 and will take the participants through the biotech crop tour, including visits to farms, laboratories and markets. Around 100 participantsincluding government oficials and opinion leaders from around the world will attend the conference including two from India. Dr.G S Toteja, Deputy Director General, Indian Council of Medical Research (ICMR), New Delhi and Dr.P D Dwivedi, Scientist, Indian Toxicology Research Centre (ITRC), Lucknow will represent India and learn about the systems and regulations that have helped the farmers and consumers alike to reap the benefits of the technology. This will also be an opportunity to meet with biotech regulators from other parts of the world including those from Mexico, Africa, Egypt, Saudi Arabia, Bangladesh, Pakistan, Japan, Korea, China, Malaysia, Indonesia to name a few.
In its endeavour to be a provider of factual information, the Council will also be conductiing a Biotech Harvest Tour from Oct 17 – 21, 2005 in this 10th year of biotech, for 18 journalists from 12 countries, incliding one from India. A five-day tour through the Midwest, includes visits to the Chicago Board of Trade, a grain elevator, research and industry facilities and several farms throughout Illinois, Indiana and Ohio. The journalists will observe the management, science and acceptance of agricultural biotechnology in the United States through direct contact with U.S. growers, regulators, academics, researchers and industry.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 10, 2005
Saturday, October 01, 2005
Commodity prices on a high in India; Corn with High Protein and oil developed in US; Ministry of Food Processing Industries issues guidelines for Meat
Commodity prices on a high in India
Though the harvest for corn has already started in parts of Karnataka, the prices of yellow corn and similar varieties which are used by poultry and starch industry continue to be high and rule at Rs.5600 – Rs.5700 ($129 – 130) per MT at the market yards on an average. Add to this the commissions and delivery charges, the price at the end use point is close to Rs.6200 – Rs.6400 ($142 – 147) per MT.
Other coarse grains which can also be used in poultry (Grain Sorghum and Pearl Millet) are also in short supply and the prices at the end of the week were about 25% and 6% respectively higher than corn, putting all the pressure on corn.
Some analysts believe production of corn in India to be lower by 20-25% than last year, due to delayed rains, drought like conditions and later heavy rains at the fag end of the crop season. A correct picture will emerge only after Oct 15th when more arrivals start coming in at the market yards. Major losses are reported from Uttar Pradesh & Rajasthan in the North, Andhra Pradesh in South. There are some gains reported from Karnataka, which are not sufficient to cover the losses in the above states.
Rabi (winter) maize is showing some gains in Tamil Nadu, but with Tamil Nadu consuming about 1.2 MMT of corn a year for broiler and layer sectors and production estimated at 0.45 – 0.6 MMT, it is going to put pressure on Andhra Pradesh and Karnataka to cover the supplies. On one side Government of India has talked about diversification in agriculture and move from wheat and rice to other crops, it has hiked the minimum support price (MSP) for Wheat and Barley by Rs.100 ($2.30) per MT. This would enhance the MSP to Rs.6500 ($149) per MT for wheat and Rs.5500 ($126) per MT for barley.
Major expansion in poultry is predicted in South India, especially layers in Namakkal in Tamil Nadu to the tune of 25% which is going to increase the pressure on corn in South India.
The prices of corn in US are coming down as harvest progresses. December corn closed at $2.055 per bushel ($80.96 per MT), $0.70 per MT lower than Sept 23 closing for Dec 2005 delivery. The freight rates on the other hand are expected to go up in near future.
U S Grains Council officers are conducting a corn crop survey in China and initial reports indicate a 4-5% lower production for the year 2005-06. The production was estimated at 127 MMT, but this figure is being though as too high. Some of the Chinese analysts have predicted that China would soon be a net importer of corn.
Corn with High Protein and oil developed in US
Protein content of corn grain has been doubled by Daniel Gallie, a professor of biochemistry at UC Riverside in the United States. This discovery would significantly add value to the crop and benefit corn producers & humanity alike. It could also provide a cost-effective solution to tackling global hunger.
In the United States, the vast majority of corn – nearly 65 per cent – is used to feed animals for meat production. Much of the remainder is exported to other countries for feeding animals or made into corn sweeteners or fuel alcohol.
Corn, the most widely produced feed grain in the United States, with over 80 million acres of land planted with corn.
Every corn kernel results from a flower on an ear of corn, Gallie explained. Initially the ear produces a pair of flowers for every kernel. But then one of the sister flowers undergoes abortion, resulting in one flower for each kernel.
Gallie's research group has developed technology that essentially rescues the aborted flower, resulting in two kernels that are fused together.
“Despite the fusion, the kernels are not bigger,” said Gallie. “It's basically the same corn, except that it is protein-rich and starch-poor – something that, if applied to sweet corn, would appeal to a large number of weight-conscious people in this country who are interested in low-carb diets and who normally avoid corn in their diets.”
Gallie and his colleagues published their work last year in The Plant Journal. Though their research focused on feed corn, the technology can easily be applied to sweet corn, a sugar-rich mutant strain of regular corn.
The US department of agriculture, the National Science Foundation, and the California Agricultural Experiment Station funded the research.
Ministry of Food Processing Industries issues guidelines for Meat Food Products
Ministry of Food Processing Industries, Government of India has issued guidelines to all State Secretaries, Department of Health, on the Implementation of Meat Food Products Order 1973. The guidelines cover aspects on issue of licences and their renewal, inspection of premises and material and seizure of the unapproved products. This is part of government of India's scheme to promote safe and hygienically producded processed foods.
The guidelines list out the procedures that will need to be followed for issue of license and the rules that would need to be followed by the industry which include among other things – medical fitness certificates of workers at the plant, water analysis report and an undertaking by the manufacturer to obtain HACCP certification within a stipulated time period. The guidelines also indicate that the source of meat would need to be mentioned in the license book and any deviation would result in seizure of the product and issuance of show cause notice to the manufacturer. These guidelines would help the manufacturer enhance the quality of products produced and increase consumer confidence in processed products in the long run.
Ministry of Food Processing Industries also took out an advertisement on Sept 19, 2005 in The Economic Times, providing useful information to the consumers on the value of and promoting processed foods. The slogan is also appropriate ‘ Processed food - really very good’. The advertisement lists five reasons on why processed foods make good sense and a foot note which covers all, ‘What more, with quality guarantee in every pack, you can be sure of it’s goodness’.
By issuing guidelines and advertisements, Government of India is promoting the processed food industry and trying to create confidence amongst the consumers to purchase processed foods without any fear. A commendable step from the ministry indeed, which will help the industry think is terms of more investment in this sector.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 01, 2005
Though the harvest for corn has already started in parts of Karnataka, the prices of yellow corn and similar varieties which are used by poultry and starch industry continue to be high and rule at Rs.5600 – Rs.5700 ($129 – 130) per MT at the market yards on an average. Add to this the commissions and delivery charges, the price at the end use point is close to Rs.6200 – Rs.6400 ($142 – 147) per MT.
Other coarse grains which can also be used in poultry (Grain Sorghum and Pearl Millet) are also in short supply and the prices at the end of the week were about 25% and 6% respectively higher than corn, putting all the pressure on corn.
Some analysts believe production of corn in India to be lower by 20-25% than last year, due to delayed rains, drought like conditions and later heavy rains at the fag end of the crop season. A correct picture will emerge only after Oct 15th when more arrivals start coming in at the market yards. Major losses are reported from Uttar Pradesh & Rajasthan in the North, Andhra Pradesh in South. There are some gains reported from Karnataka, which are not sufficient to cover the losses in the above states.
Rabi (winter) maize is showing some gains in Tamil Nadu, but with Tamil Nadu consuming about 1.2 MMT of corn a year for broiler and layer sectors and production estimated at 0.45 – 0.6 MMT, it is going to put pressure on Andhra Pradesh and Karnataka to cover the supplies. On one side Government of India has talked about diversification in agriculture and move from wheat and rice to other crops, it has hiked the minimum support price (MSP) for Wheat and Barley by Rs.100 ($2.30) per MT. This would enhance the MSP to Rs.6500 ($149) per MT for wheat and Rs.5500 ($126) per MT for barley.
Major expansion in poultry is predicted in South India, especially layers in Namakkal in Tamil Nadu to the tune of 25% which is going to increase the pressure on corn in South India.
The prices of corn in US are coming down as harvest progresses. December corn closed at $2.055 per bushel ($80.96 per MT), $0.70 per MT lower than Sept 23 closing for Dec 2005 delivery. The freight rates on the other hand are expected to go up in near future.
U S Grains Council officers are conducting a corn crop survey in China and initial reports indicate a 4-5% lower production for the year 2005-06. The production was estimated at 127 MMT, but this figure is being though as too high. Some of the Chinese analysts have predicted that China would soon be a net importer of corn.
Corn with High Protein and oil developed in US
Protein content of corn grain has been doubled by Daniel Gallie, a professor of biochemistry at UC Riverside in the United States. This discovery would significantly add value to the crop and benefit corn producers & humanity alike. It could also provide a cost-effective solution to tackling global hunger.
In the United States, the vast majority of corn – nearly 65 per cent – is used to feed animals for meat production. Much of the remainder is exported to other countries for feeding animals or made into corn sweeteners or fuel alcohol.
Corn, the most widely produced feed grain in the United States, with over 80 million acres of land planted with corn.
Every corn kernel results from a flower on an ear of corn, Gallie explained. Initially the ear produces a pair of flowers for every kernel. But then one of the sister flowers undergoes abortion, resulting in one flower for each kernel.
Gallie's research group has developed technology that essentially rescues the aborted flower, resulting in two kernels that are fused together.
“Despite the fusion, the kernels are not bigger,” said Gallie. “It's basically the same corn, except that it is protein-rich and starch-poor – something that, if applied to sweet corn, would appeal to a large number of weight-conscious people in this country who are interested in low-carb diets and who normally avoid corn in their diets.”
Gallie and his colleagues published their work last year in The Plant Journal. Though their research focused on feed corn, the technology can easily be applied to sweet corn, a sugar-rich mutant strain of regular corn.
The US department of agriculture, the National Science Foundation, and the California Agricultural Experiment Station funded the research.
Ministry of Food Processing Industries issues guidelines for Meat Food Products
Ministry of Food Processing Industries, Government of India has issued guidelines to all State Secretaries, Department of Health, on the Implementation of Meat Food Products Order 1973. The guidelines cover aspects on issue of licences and their renewal, inspection of premises and material and seizure of the unapproved products. This is part of government of India's scheme to promote safe and hygienically producded processed foods.
The guidelines list out the procedures that will need to be followed for issue of license and the rules that would need to be followed by the industry which include among other things – medical fitness certificates of workers at the plant, water analysis report and an undertaking by the manufacturer to obtain HACCP certification within a stipulated time period. The guidelines also indicate that the source of meat would need to be mentioned in the license book and any deviation would result in seizure of the product and issuance of show cause notice to the manufacturer. These guidelines would help the manufacturer enhance the quality of products produced and increase consumer confidence in processed products in the long run.
Ministry of Food Processing Industries also took out an advertisement on Sept 19, 2005 in The Economic Times, providing useful information to the consumers on the value of and promoting processed foods. The slogan is also appropriate ‘ Processed food - really very good’. The advertisement lists five reasons on why processed foods make good sense and a foot note which covers all, ‘What more, with quality guarantee in every pack, you can be sure of it’s goodness’.
By issuing guidelines and advertisements, Government of India is promoting the processed food industry and trying to create confidence amongst the consumers to purchase processed foods without any fear. A commendable step from the ministry indeed, which will help the industry think is terms of more investment in this sector.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
October 01, 2005
Monday, September 26, 2005
Commodity prices: A mixed bag; US Grains Council completes 2nd Poultry Meat Inspection Training workshop in India
Commodity prices: A mixed bag
Rains lashed parts of Maharashtra, Gujarat and Andhra Pradesh and might affect the production of grains and oilseeds in these belts. Flooding was reported from Godhra, Baroda in Gujarat, Kakinada, Vijaywada and surrounding areas in Andhra Pradesh and Bombay and surrounding areas in Maharashtra. Areas around Godavari river in Andhra Pradesh have been hit very badly and the floods are likely to affect Paddy, Chilli and Sugarcane in these areas. Coarse cereal production may also be hit in the affected areas.
In the midweek the average prices were higher for some and lower for some, a mixed bag. While prices for Bajra (Pearl Millet) were reported to go up from $130 to $149 per MT, prices of Barley reported a downtrend from $162 to $157 per MT. Grain sorghum prices also were lower from $166 to $143 per MT in the week. This could be due to less of buyers and low supply or lower quality stocks as this is the fag end of the crop season. The maize prices were a tad lower than last week and came lower by $1 per MT from $129 to $128 per MT. At the end of the week the prices for certain varieties were again higher and average price was up to $130 per MT. The average prices for Yellow, Kesari & Red varieties were although much higher and ranged from $136 - $138 per MT.
In US hurricane Rita lashed the coast of Louisiana and Texas and the city of New Orleans was hit once again. Reports indicate two refineries being damaged which is likely to affect supply of gasoline in parts of US.
The grain prices were however reported lower. For Dec 2005, the CBOT was reported at $81.66 per ton and the FOB value at $100 per ton (US Gulf). The barge / rail and ocean freight rates continued their upward trend last week.
US Grains Council completes 2nd Poultry Meat Inspection Training workshop in India
The 2nd Poultry Meat Inspection Training workshop, organized by U S Grains Council from Sept 18 – 23, 2005 at Coimbatore had a very encouraging response. Sixteen participants including officers from Ministry of Food Processing Industries, Government of India from North, South and East offices and production managers of some of the private poultry slaughter facilities in south India attended the workshop. The areas covered included, US poultry meat inspection systems, HACCP guidelines, post mortem findings, food safety issues, temperature abuse during transport and retail and affect on meat quality.
Few of the major recommendations included:
1. Regulation of live markets by the local authorities on the initiative by the traders and the poultry industry.
2. Poultry industry associations to approach the Federation of Hotel & Restaurant Associations of India (FHRAI) and help set norms for purchase of meat and meat products from registered suppliers.
3. The industry needs to work closely with packing material suppliers and institutes to provide good packaging material which is cheap, but at the same time safe and food grade.
4. Customer education is a vital tool and creating awareness about quality and food safety issues will be important factor in promoting chilled and processed poultry meat and meat products.
5. Whole sale and retail chain management in selling chilled and frozen products is vital and those involved in the segment will need to be made aware of the food safety issues.
The Ministry of Food Processing Industries, Government of India has principally agreed to include chilled and frozen chicken in its list of products. As soon as it is notified, the processing plants will need to register their plants with Ministry of Food Processing Industries and will obtain a plant number, which will need to be displayed on the packet along with the MFPI Logo. The companies will be able to promote this and will have an advantage over those whose plants will not be registered or those selling poultry meat sourced from unregistered sources.
In the long run, the registration of the plants will help the industry to create consumer confidence and expand the market much more. Currently only 5% of the broilers produced are processed mechanically under hygienic conditions. An increased consumer confidence will certainly help in increasing this share. In addition, it will be possible for the industry to grow much more than its 10% per year current growth.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Sept 26, 2005
Rains lashed parts of Maharashtra, Gujarat and Andhra Pradesh and might affect the production of grains and oilseeds in these belts. Flooding was reported from Godhra, Baroda in Gujarat, Kakinada, Vijaywada and surrounding areas in Andhra Pradesh and Bombay and surrounding areas in Maharashtra. Areas around Godavari river in Andhra Pradesh have been hit very badly and the floods are likely to affect Paddy, Chilli and Sugarcane in these areas. Coarse cereal production may also be hit in the affected areas.
In the midweek the average prices were higher for some and lower for some, a mixed bag. While prices for Bajra (Pearl Millet) were reported to go up from $130 to $149 per MT, prices of Barley reported a downtrend from $162 to $157 per MT. Grain sorghum prices also were lower from $166 to $143 per MT in the week. This could be due to less of buyers and low supply or lower quality stocks as this is the fag end of the crop season. The maize prices were a tad lower than last week and came lower by $1 per MT from $129 to $128 per MT. At the end of the week the prices for certain varieties were again higher and average price was up to $130 per MT. The average prices for Yellow, Kesari & Red varieties were although much higher and ranged from $136 - $138 per MT.
In US hurricane Rita lashed the coast of Louisiana and Texas and the city of New Orleans was hit once again. Reports indicate two refineries being damaged which is likely to affect supply of gasoline in parts of US.
The grain prices were however reported lower. For Dec 2005, the CBOT was reported at $81.66 per ton and the FOB value at $100 per ton (US Gulf). The barge / rail and ocean freight rates continued their upward trend last week.
US Grains Council completes 2nd Poultry Meat Inspection Training workshop in India
The 2nd Poultry Meat Inspection Training workshop, organized by U S Grains Council from Sept 18 – 23, 2005 at Coimbatore had a very encouraging response. Sixteen participants including officers from Ministry of Food Processing Industries, Government of India from North, South and East offices and production managers of some of the private poultry slaughter facilities in south India attended the workshop. The areas covered included, US poultry meat inspection systems, HACCP guidelines, post mortem findings, food safety issues, temperature abuse during transport and retail and affect on meat quality.
Few of the major recommendations included:
1. Regulation of live markets by the local authorities on the initiative by the traders and the poultry industry.
2. Poultry industry associations to approach the Federation of Hotel & Restaurant Associations of India (FHRAI) and help set norms for purchase of meat and meat products from registered suppliers.
3. The industry needs to work closely with packing material suppliers and institutes to provide good packaging material which is cheap, but at the same time safe and food grade.
4. Customer education is a vital tool and creating awareness about quality and food safety issues will be important factor in promoting chilled and processed poultry meat and meat products.
5. Whole sale and retail chain management in selling chilled and frozen products is vital and those involved in the segment will need to be made aware of the food safety issues.
The Ministry of Food Processing Industries, Government of India has principally agreed to include chilled and frozen chicken in its list of products. As soon as it is notified, the processing plants will need to register their plants with Ministry of Food Processing Industries and will obtain a plant number, which will need to be displayed on the packet along with the MFPI Logo. The companies will be able to promote this and will have an advantage over those whose plants will not be registered or those selling poultry meat sourced from unregistered sources.
In the long run, the registration of the plants will help the industry to create consumer confidence and expand the market much more. Currently only 5% of the broilers produced are processed mechanically under hygienic conditions. An increased consumer confidence will certainly help in increasing this share. In addition, it will be possible for the industry to grow much more than its 10% per year current growth.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Sept 26, 2005
Monday, September 19, 2005
Rains in India and production estimates; U S Production estimates; CLFMA Symposium ends with a set of recommendations
Rains in India and production estimates
Rains in most of the parts of the country North, west and east have brought in respite from the severe heat, but could also damage crops if the rains continue. Some area like Punjab, Haryana, Himachal Pradesh, Orrisa have experienced rains that could damage crops like cotton, coarse cereals and rice.
Government of India came out with the first estimates for the food production for the year 2005-06 last week. The Corn production for 2005-06 is pegged at 12.17 MMT. The fourth estimates for 2004-05 estimate the corn production at 11.6 MMT. This is inline with industry estimates for the year 2004-05. The requirement for 2004-05 was close to 13.19 MMT, while in 2005-06 the requirement of corn is pegged at 13.73 MMT. The lower production will surely put pressure on corn and increase prices in the long run.
The major loss is reported in Soybean crop, production of which is expected to be down by 12.4% due to delayed rains.
The CBOT quoted lower by about $3.74 per ton for Dec corn. The FOB prices however remained unchanged at $102.5 per MT. The freight rates are going up steadily and might continue to gain.
U S Production estimates
USDA came up with the report on Sept 12, 2005 and the estimates for corn production have been increased from 262 MMT from August 2005 report to 270 MMT. The increase is mostly due to better than expected yield and a very early corn harvest that is already underway. The yield is estimated at 3.63 tons / acre (8.99 tons / hac) against 3.53 tons / acre (8.71 tons / hac) in the August report. In 2004-05 the productivity was 4.07 tons/acre (10.07 tons / hac). India has the average yield of 0.73 – 0.8 tons / acre (1.8 – 2.0 ton/hac) in corn. Though there are areas where the productivity is higher as well. USDA also came out with the world production numbers and the productivity in China (2.54 times), Argentina (3.45 times), Brazil (1.79 times), South Africa (1.56 times) and Mexico (1.5 times) is also higher than India.
The corn usage in US has also been estimated. In fiscal 2006, the usage in Feed and residual use is expected to be 148 MMT as against 156 MMT in 2004-05. The use in feed and industrial sector is expected to be higher at 72 MMT as against 68 in 2004-05. Use by ethanol sector is also expected to be higher at 38 MMT in Fy 2006 as against 33 MMT in FY 2005.
CLFMA Symposium ends with a set of recommendations
The CLFMA symposium that was held in Goa on Sept 16 – 17, 2005 had a theme of ‘Safety First – Farm to Fork’ ended with a set of recommendations being given to Government of India. The major one being setting standards for inputs (feed) and output (food) and making then mandatory.
Though there has always been interest in exports, but concern was raised on competitiveness of Indian produce in the wake of government policies which do not allow import of major inputs like grand parent stocks, vaccines, feed inputs (corn and soybean meal) and putting in barriers. Government was asked to allow import of corn and soybean meal of zero tariff and make it possible for Indian produce to be competitive in the world market.
Another major concern raised by the house was the taxation on the processed chicken, which unduly increased the prices and made safe and hygienically produced products expensive for the consumer. It was recommended that the exemptions be given to the processing sector so as the sector can utilize their capacities efficiently and provide safe food to the consumers at affordable prices.
Dr.James Denton, consultant with U S Grains Council in his presentation to a 300 strong gathering pointed out facts and spelt clearly that industry needs to consider consumer protection in the wake of food safety. This is for all consumers, outside the country or in the country. Consumers buy products on quality and food safety is an inherent part of quality. Food safety is the prerogative of the industry and governments can only provide oversight.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Reporting from Coimbatore, Sept 19, 2005
Rains in most of the parts of the country North, west and east have brought in respite from the severe heat, but could also damage crops if the rains continue. Some area like Punjab, Haryana, Himachal Pradesh, Orrisa have experienced rains that could damage crops like cotton, coarse cereals and rice.
Government of India came out with the first estimates for the food production for the year 2005-06 last week. The Corn production for 2005-06 is pegged at 12.17 MMT. The fourth estimates for 2004-05 estimate the corn production at 11.6 MMT. This is inline with industry estimates for the year 2004-05. The requirement for 2004-05 was close to 13.19 MMT, while in 2005-06 the requirement of corn is pegged at 13.73 MMT. The lower production will surely put pressure on corn and increase prices in the long run.
The major loss is reported in Soybean crop, production of which is expected to be down by 12.4% due to delayed rains.
The CBOT quoted lower by about $3.74 per ton for Dec corn. The FOB prices however remained unchanged at $102.5 per MT. The freight rates are going up steadily and might continue to gain.
U S Production estimates
USDA came up with the report on Sept 12, 2005 and the estimates for corn production have been increased from 262 MMT from August 2005 report to 270 MMT. The increase is mostly due to better than expected yield and a very early corn harvest that is already underway. The yield is estimated at 3.63 tons / acre (8.99 tons / hac) against 3.53 tons / acre (8.71 tons / hac) in the August report. In 2004-05 the productivity was 4.07 tons/acre (10.07 tons / hac). India has the average yield of 0.73 – 0.8 tons / acre (1.8 – 2.0 ton/hac) in corn. Though there are areas where the productivity is higher as well. USDA also came out with the world production numbers and the productivity in China (2.54 times), Argentina (3.45 times), Brazil (1.79 times), South Africa (1.56 times) and Mexico (1.5 times) is also higher than India.
The corn usage in US has also been estimated. In fiscal 2006, the usage in Feed and residual use is expected to be 148 MMT as against 156 MMT in 2004-05. The use in feed and industrial sector is expected to be higher at 72 MMT as against 68 in 2004-05. Use by ethanol sector is also expected to be higher at 38 MMT in Fy 2006 as against 33 MMT in FY 2005.
CLFMA Symposium ends with a set of recommendations
The CLFMA symposium that was held in Goa on Sept 16 – 17, 2005 had a theme of ‘Safety First – Farm to Fork’ ended with a set of recommendations being given to Government of India. The major one being setting standards for inputs (feed) and output (food) and making then mandatory.
Though there has always been interest in exports, but concern was raised on competitiveness of Indian produce in the wake of government policies which do not allow import of major inputs like grand parent stocks, vaccines, feed inputs (corn and soybean meal) and putting in barriers. Government was asked to allow import of corn and soybean meal of zero tariff and make it possible for Indian produce to be competitive in the world market.
Another major concern raised by the house was the taxation on the processed chicken, which unduly increased the prices and made safe and hygienically produced products expensive for the consumer. It was recommended that the exemptions be given to the processing sector so as the sector can utilize their capacities efficiently and provide safe food to the consumers at affordable prices.
Dr.James Denton, consultant with U S Grains Council in his presentation to a 300 strong gathering pointed out facts and spelt clearly that industry needs to consider consumer protection in the wake of food safety. This is for all consumers, outside the country or in the country. Consumers buy products on quality and food safety is an inherent part of quality. Food safety is the prerogative of the industry and governments can only provide oversight.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Reporting from Coimbatore, Sept 19, 2005
Saturday, September 10, 2005
Commodity Prices and Monsoon Panic; Motorists want ethanol as oil prices soar;USGC 2nd Poultry Meat Inspection Training Course in Coimbatore
Commodity Prices and Monsoon Panic
Over the last week, the commodity prices have increased rapidly. This increase can be attributed to two things.
1. Monsoon Panic
2. Low stocks in the market viz a viz higher demand
As regards monsoon panic, IMD has predicted few rains in North India. More rains are predicted in South and Western parts of the country, especially Maharathtra. Within the next one week, heavy rainfall is predicted in west coast (www.monsoondata.org), while most of North India will remain parched. The temperatures in the next one week are also predicted to reach over 30 degrees C in parts of Rajasthan, Haryana, Punjab and Delhi.
Based on the data available from IMD, monsoon has left fields parched in Western Rajasthan (-39%), Western UP (-28%), Haryana (-23%), Delhi & Punjab (-22%). Due to deficient rains in North India the crops that are likely to be effected are Sugarcane, Rice, Coarse cereals (maize, Jowar and bajra) and Oilseeds, in states of Uttar Pradesh, Punjab, Haryana, Rajasthan, Jharkhand and Bihar
Within the last one week, average prices of all coarse cereals have gone up. The major gainer being Barja +8.5%, Barley +9.96%, Jowar (Grain Sorghum) +14.5%. Corn is the only commodity prices of which has shown a very small increase of 2.8% as most of the end users are covered till the new crop arrives in the market.
CBOT closed a little lower than last week. Sept corn was $2.03 per bushel ($79.98 per MT) as against $2.0350 per bushel ($80.18 per MT) last week. Dec corn closed at $2.1675 ($85.39 per MT), lower than last week’s 2.1775 per bushel ($85.79 per MT)
The trade awaits the Sept 12, 2005 USDA report. As per the industry report, corn production estimates will again be lowered and the producted is estimated to be close to 10.288 billion bushels (261 MMT) (Average 10.027 – 10.595 billion bushels) (254 – 269 MMT) as against last months 10.35 billion bushels (262 MMT) report. The decrease in production is being attributed to high temperature in the corn belt.
Motorists want ethanol as oil prices soar (from various sources)
Motorists around the world are looking for cheaper fuels to run theor cars. Bio fuels have shown the way and more and more people in US, Brazil, Europe are filling their cars with more biofuels, such as ethanol made from sugar cane or corn, in the hunt for cheaper alternatives to high gasoline prices. Even before the recent surge in crude prices, countries in the Americas, Europe, Asia including India and Africa were integrating biofuels into national energy plans. France and China also plan to step up the adoption of renewable energies.
In the latest U.S. ethanol production data, output in the month of June set a record of 249,000 barrels a day and demand was growing even faster, hitting 277,000 barrels a day. Ethanol production as it is practiced in the United States -- the world's biggest fuel market -- and Europe using grain or sugarbeet, only began to become economically competitive with gasoline when world oil prices rose above $40 a barrel. On Tuesday, Sept 06, 2005 at the NYMEX futures exchange in New York, crude for October delivery was trading at nearly $66, down from last week's peak close to $71. Expects are of the opinion that the market could run to new highs should supply disruptions or an unexpected rise in demand emerge.
The explosion in demand has come from the development of flex-fuel car engines which can run on gasoline, ethanol or any blend, whichever is cheapest. Brazil, in recent years, has used about 45 percent of its cane crop for ethanol production, the rest for sugar production. In 2005, brazil is expected to use more than 51 percent of its cane crop for ethanol production because of demand from flex-fuel cars.
In India ethanol is made from molasses, after sugar has been extracted, which would possibly increase the cost of production. India is the largest consumer of sugar and if the current situation prevails, India is likely to import 1.5 MMT of raw sugar this season to bridge the demand and supply gap. The gap is likely to remain till 2006-07.
Ethanol fuel, also used as a gasoline additive to reduce pollution, a substitute for lead and sulfur and to extend gasoline stocks, is just emerging as a commodity on the global market. Ethanol futures contracts that debuted in March at the Chicago Board of Trade.
Effective use of By products
As the use of corn based Ethanol in increases, the use of Dried Distillers Grain with solubles is also gaining support. Countries like Korea, Vietnam and experimenting with DDGS in total mix rations (TMR) to be used for feeding heifers, calves and lactating cows.
It is rather difficult to gauze the market for DDG as the ethanol plants are spread across the country and the prices range from $75 in the northern plains, to $90 in Kansas and Missouri and $116 in California. (All prices are FOB basis).
USGC 2nd Poultry Meat Inspection Training Course in Coimbatore
After the success of the 1st Poultry Meat Inspection Training Course conducted by U S Grains Council in April 2005 in Bombay, the council is all geared to start its 2nd Poultry Meat Inspection Training Course in Coimbatore from Sept 18–23, 2005. About 15 participants from Ministry of Food processing Industries and private sector processing plants are expected to attend.
The attendees will receive information on US poultry inspection systems, HACCP based inspection model, Port mortem findings, chilling and freezing, packing and transport. Information on retail chain systems and food safety issues related to meat handling will be provided to the participants.
Currently no chicken being sold in the market is inspected by a government agency and certified as wholesome. Almost 95% of the chicken sold in India is traded as live and slaughtered in the streets on shops as per the requirement of the customers. This slaughter is under unhygienic conditions.
Though several municipalities have issued orders to stop street slaughter the same have not been implemented as there is no infrastructure for mechanical slaughter and the officers are not trained to inspect the poultry meat. The Ministry of Food Processing Industries, Government of India has finalized the guidelines for inclusion of chilled and frozen chicken in its mandate under Meat Food products Order of 1973. Currently MFPO covers value added products and does nor cover raw poultry meat.
Sale of inspected poultry meat is expected to boost sales and consumer confidence. As integration is set to make inroads in almost all poultry belts, the consumers can expect a better product at a good price. Integration will also aim to remove the middlemen from the system and provide a direct link between the farmer –processor and the consumer.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Sept 10, 2005
Over the last week, the commodity prices have increased rapidly. This increase can be attributed to two things.
1. Monsoon Panic
2. Low stocks in the market viz a viz higher demand
As regards monsoon panic, IMD has predicted few rains in North India. More rains are predicted in South and Western parts of the country, especially Maharathtra. Within the next one week, heavy rainfall is predicted in west coast (www.monsoondata.org), while most of North India will remain parched. The temperatures in the next one week are also predicted to reach over 30 degrees C in parts of Rajasthan, Haryana, Punjab and Delhi.
Based on the data available from IMD, monsoon has left fields parched in Western Rajasthan (-39%), Western UP (-28%), Haryana (-23%), Delhi & Punjab (-22%). Due to deficient rains in North India the crops that are likely to be effected are Sugarcane, Rice, Coarse cereals (maize, Jowar and bajra) and Oilseeds, in states of Uttar Pradesh, Punjab, Haryana, Rajasthan, Jharkhand and Bihar
Within the last one week, average prices of all coarse cereals have gone up. The major gainer being Barja +8.5%, Barley +9.96%, Jowar (Grain Sorghum) +14.5%. Corn is the only commodity prices of which has shown a very small increase of 2.8% as most of the end users are covered till the new crop arrives in the market.
CBOT closed a little lower than last week. Sept corn was $2.03 per bushel ($79.98 per MT) as against $2.0350 per bushel ($80.18 per MT) last week. Dec corn closed at $2.1675 ($85.39 per MT), lower than last week’s 2.1775 per bushel ($85.79 per MT)
The trade awaits the Sept 12, 2005 USDA report. As per the industry report, corn production estimates will again be lowered and the producted is estimated to be close to 10.288 billion bushels (261 MMT) (Average 10.027 – 10.595 billion bushels) (254 – 269 MMT) as against last months 10.35 billion bushels (262 MMT) report. The decrease in production is being attributed to high temperature in the corn belt.
Motorists want ethanol as oil prices soar (from various sources)
Motorists around the world are looking for cheaper fuels to run theor cars. Bio fuels have shown the way and more and more people in US, Brazil, Europe are filling their cars with more biofuels, such as ethanol made from sugar cane or corn, in the hunt for cheaper alternatives to high gasoline prices. Even before the recent surge in crude prices, countries in the Americas, Europe, Asia including India and Africa were integrating biofuels into national energy plans. France and China also plan to step up the adoption of renewable energies.
In the latest U.S. ethanol production data, output in the month of June set a record of 249,000 barrels a day and demand was growing even faster, hitting 277,000 barrels a day. Ethanol production as it is practiced in the United States -- the world's biggest fuel market -- and Europe using grain or sugarbeet, only began to become economically competitive with gasoline when world oil prices rose above $40 a barrel. On Tuesday, Sept 06, 2005 at the NYMEX futures exchange in New York, crude for October delivery was trading at nearly $66, down from last week's peak close to $71. Expects are of the opinion that the market could run to new highs should supply disruptions or an unexpected rise in demand emerge.
The explosion in demand has come from the development of flex-fuel car engines which can run on gasoline, ethanol or any blend, whichever is cheapest. Brazil, in recent years, has used about 45 percent of its cane crop for ethanol production, the rest for sugar production. In 2005, brazil is expected to use more than 51 percent of its cane crop for ethanol production because of demand from flex-fuel cars.
In India ethanol is made from molasses, after sugar has been extracted, which would possibly increase the cost of production. India is the largest consumer of sugar and if the current situation prevails, India is likely to import 1.5 MMT of raw sugar this season to bridge the demand and supply gap. The gap is likely to remain till 2006-07.
Ethanol fuel, also used as a gasoline additive to reduce pollution, a substitute for lead and sulfur and to extend gasoline stocks, is just emerging as a commodity on the global market. Ethanol futures contracts that debuted in March at the Chicago Board of Trade.
Effective use of By products
As the use of corn based Ethanol in increases, the use of Dried Distillers Grain with solubles is also gaining support. Countries like Korea, Vietnam and experimenting with DDGS in total mix rations (TMR) to be used for feeding heifers, calves and lactating cows.
It is rather difficult to gauze the market for DDG as the ethanol plants are spread across the country and the prices range from $75 in the northern plains, to $90 in Kansas and Missouri and $116 in California. (All prices are FOB basis).
USGC 2nd Poultry Meat Inspection Training Course in Coimbatore
After the success of the 1st Poultry Meat Inspection Training Course conducted by U S Grains Council in April 2005 in Bombay, the council is all geared to start its 2nd Poultry Meat Inspection Training Course in Coimbatore from Sept 18–23, 2005. About 15 participants from Ministry of Food processing Industries and private sector processing plants are expected to attend.
The attendees will receive information on US poultry inspection systems, HACCP based inspection model, Port mortem findings, chilling and freezing, packing and transport. Information on retail chain systems and food safety issues related to meat handling will be provided to the participants.
Currently no chicken being sold in the market is inspected by a government agency and certified as wholesome. Almost 95% of the chicken sold in India is traded as live and slaughtered in the streets on shops as per the requirement of the customers. This slaughter is under unhygienic conditions.
Though several municipalities have issued orders to stop street slaughter the same have not been implemented as there is no infrastructure for mechanical slaughter and the officers are not trained to inspect the poultry meat. The Ministry of Food Processing Industries, Government of India has finalized the guidelines for inclusion of chilled and frozen chicken in its mandate under Meat Food products Order of 1973. Currently MFPO covers value added products and does nor cover raw poultry meat.
Sale of inspected poultry meat is expected to boost sales and consumer confidence. As integration is set to make inroads in almost all poultry belts, the consumers can expect a better product at a good price. Integration will also aim to remove the middlemen from the system and provide a direct link between the farmer –processor and the consumer.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Sept 10, 2005
Saturday, September 03, 2005
Monsoon Perils and Grain Production; Kartina and its after effects
Monsoon Perils and Grain Production
It may not be official as yet, but monsoon seems to be over as of now. Officially the monsoon season ends on Sept 30 and there would a 10% deficit then, if there is a little progress. Current deficit is about 6%. The areas in the deficit zone are west Rajasthan; west Uttar Pradesh; Jharkhand; Nagaland-Manipur-Mizoram-Tripura; coastal Andhra Pradesh and western Madhya Pradesh. Reports suggest that the soya crop which is the main crop of the area (Madhya Pradesh and parts of Rajasthan) is in danger of withering, if there is no rainfall in the next 2 – 3 days.
As per Indian Meteorological Department, a new touch is forming which might bring rainfall over all four southern States, Kerala, Karnataka, Tamil Nadu and Andhra Pradesh in the next 2 – 3 days.
Amidst all this talk about monsoon, the grain prices have shown an upoward trend. Yellow corn prices averaged at Rs.6010 ($138) per MT. The local corn traded at Rs.6900 ($159) per MT. The highest prices were reported in Gujarat. The harvest still about a month away, increased prices will effect the maize user industries, bring down profits.
The prices in US remained almost same as last week. CBOT closed at $2.035 per bushel ($80.18 per MT) for September delivery. The December delivery was marginally lower than last week at $2.1725 per bushel ($85.60 per MT). The FOB prices were $102 per MT for October and $104 per MT for November delivery.
The freight rates are expected to go up higher in the wake of Kartina, higher demand of grains in the world market and higher fuel prices.
As regards increased demand in the world, China's grain demand is predicted to continue its slow growth in the next four years, with grain consumption increasing 0.9 percent annually. In India as per the analysis the maize demand is expected to grow by 4.1 percent in 2005-06, whereas the production is expected is decrease by about 5.7% over last year. The increase in consumption is due to the increased broiler placement and the decreased production of corn due to the erratic monsoon.
Kartina and its after effects
The start of the week saw hurricane Katrina hitting the US gult coast and hitting it hard with 232 km per hour winds, damaging property worth billions of dollars and taking almost 10,000 lives (No one can predict, but the number was an estimate given by CNN.com).
The hurricane has damaged the city of New Orleans, the port of New Orleans, refineries in the Gulf of Mexico and the rail link between Mississippi and New Orleans.
The port handles almost 62 percent of all grain and soy that is exported out of US. The grain travels by barges and rail cars to the port and is loaded to the ships. On any given day 2 millions bushels (50813 tons) of grain leaves US. If there is any stoppage of the trade due to the closure of the port, it will have a cascading effect. Due to the current slowdown, the effect can already be felt. With harvest round the corner, the pressure to store the new crop will be immense. Some analysts have forecasted losses to the $1 billion on account of disrupted traffic, another $ 1 Billion is estimated on account of crop losses in Louisiana, Mississippi, Alabama, Florida and Tennessee.
The biggest danger is that Katrina has seriously damaged Gulf Coast refineries, which account for 10% of U.S. refining capacity. Experts warned that gasoline prices -- driven higher because of storm-related damage to the Gulf Coast's energy infrastructure -- were the greatest concern and might be approaching levels that would soon ripple through the economy. If that happens, prices of basic items could soar, pushing up inflation. As per reports the gasoline prices are already touching $3.55 per gallon (Rs.40.85 per litres).
With the grain movement being slow the and likely to remain slow for coming months, the world will probably be little starved and possibly taking prices a little higher.
India may also be in shock, if the world prices of crude oil go up. Indian Oil Corporation has already states that Government should increase the price of gasoline by Rs.7.50 per litre ($0.17 per litre) and diesel by Rs.5.00 per litre ($0.11 per litre). What would be the effect of this on inflation, probably no one has guessed.
Regards
Amit Sachdev
bluecross303@gmail.com
Sept 03, 2005
It may not be official as yet, but monsoon seems to be over as of now. Officially the monsoon season ends on Sept 30 and there would a 10% deficit then, if there is a little progress. Current deficit is about 6%. The areas in the deficit zone are west Rajasthan; west Uttar Pradesh; Jharkhand; Nagaland-Manipur-Mizoram-Tripura; coastal Andhra Pradesh and western Madhya Pradesh. Reports suggest that the soya crop which is the main crop of the area (Madhya Pradesh and parts of Rajasthan) is in danger of withering, if there is no rainfall in the next 2 – 3 days.
As per Indian Meteorological Department, a new touch is forming which might bring rainfall over all four southern States, Kerala, Karnataka, Tamil Nadu and Andhra Pradesh in the next 2 – 3 days.
Amidst all this talk about monsoon, the grain prices have shown an upoward trend. Yellow corn prices averaged at Rs.6010 ($138) per MT. The local corn traded at Rs.6900 ($159) per MT. The highest prices were reported in Gujarat. The harvest still about a month away, increased prices will effect the maize user industries, bring down profits.
The prices in US remained almost same as last week. CBOT closed at $2.035 per bushel ($80.18 per MT) for September delivery. The December delivery was marginally lower than last week at $2.1725 per bushel ($85.60 per MT). The FOB prices were $102 per MT for October and $104 per MT for November delivery.
The freight rates are expected to go up higher in the wake of Kartina, higher demand of grains in the world market and higher fuel prices.
As regards increased demand in the world, China's grain demand is predicted to continue its slow growth in the next four years, with grain consumption increasing 0.9 percent annually. In India as per the analysis the maize demand is expected to grow by 4.1 percent in 2005-06, whereas the production is expected is decrease by about 5.7% over last year. The increase in consumption is due to the increased broiler placement and the decreased production of corn due to the erratic monsoon.
Kartina and its after effects
The start of the week saw hurricane Katrina hitting the US gult coast and hitting it hard with 232 km per hour winds, damaging property worth billions of dollars and taking almost 10,000 lives (No one can predict, but the number was an estimate given by CNN.com).
The hurricane has damaged the city of New Orleans, the port of New Orleans, refineries in the Gulf of Mexico and the rail link between Mississippi and New Orleans.
The port handles almost 62 percent of all grain and soy that is exported out of US. The grain travels by barges and rail cars to the port and is loaded to the ships. On any given day 2 millions bushels (50813 tons) of grain leaves US. If there is any stoppage of the trade due to the closure of the port, it will have a cascading effect. Due to the current slowdown, the effect can already be felt. With harvest round the corner, the pressure to store the new crop will be immense. Some analysts have forecasted losses to the $1 billion on account of disrupted traffic, another $ 1 Billion is estimated on account of crop losses in Louisiana, Mississippi, Alabama, Florida and Tennessee.
The biggest danger is that Katrina has seriously damaged Gulf Coast refineries, which account for 10% of U.S. refining capacity. Experts warned that gasoline prices -- driven higher because of storm-related damage to the Gulf Coast's energy infrastructure -- were the greatest concern and might be approaching levels that would soon ripple through the economy. If that happens, prices of basic items could soar, pushing up inflation. As per reports the gasoline prices are already touching $3.55 per gallon (Rs.40.85 per litres).
With the grain movement being slow the and likely to remain slow for coming months, the world will probably be little starved and possibly taking prices a little higher.
India may also be in shock, if the world prices of crude oil go up. Indian Oil Corporation has already states that Government should increase the price of gasoline by Rs.7.50 per litre ($0.17 per litre) and diesel by Rs.5.00 per litre ($0.11 per litre). What would be the effect of this on inflation, probably no one has guessed.
Regards
Amit Sachdev
bluecross303@gmail.com
Sept 03, 2005
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