Commodity prices & Production estimates
This week is a mixed bag. Same time last month there was heavy rainfall in Maharashtra, Karnataka and surrounding areas and there was loss to agriculture in these parts. This week the monsoon has subdued and as per the report from the Indian Meterological Department, the overall deficit at this point is 3%. Areas that have been put under moisture stress watch are Rajasthan, Tamil Nadu, Western Uttar Pradesh, Bihar, Jharkhand, Assam.
Due to the erratic monsoon, the area under coarse cereals and oilseeds has dipped. As per Ministry of Agriculture reports Maize area is down from last years 7.2 mill ha to 6.9 mill ha. Industry estimates the coverage at 6.7 mill ha. The monsoon and the dry spell will also effect the productivity, but it is too early to say anything about it. First estimates available put the figure 1.7 – 1.75 tons/ha, putting the production at 11.3 – 11.7 MMT. A lot would depend on the monsoon again and if reports from National Centre for Medium Range Weather Forecasting (NCMRWF) are to be taken, the monsoon is already in break-like phase again and if no rains are there, the standing crop in the rainfed areas will be severely effected.
Area under Grain Sorghum (Jowar) is also down to 3.93 mill ha, while Pearl Millet (Bajra) is down to 8.72 mill ha from 8.97 mill ha last year. The area under Cotton (8.13 mill ha), pulses (9.65 mill ha) and sugarcane (4.19 mill ha) has gone up from last year 7.86 mill ha for Cotton, 8.38 mill ha for pulses and 3.75 mill ha of Sugarcane respectively.
The prices of corn are in the spot Market have risen tremendously is the last one month. Corn in Davangere (Karnataka) is now offered at Rs.5640 ($130) per MT as against Rs.5500 ($126) per MT, an increase of 2.5 percent. While in Nizamabad the prices have gone up by 4.6 percent, The prices are up from Rs.5830 ($134) per MT to Rs.6100 per MT ($140) per MT.
The prices in US are down and the CBOT closed at $80.27 per MT on Friday (Aug 26) lower by $2.56 per MT from last week (Aug 19). The FOB US Gulf price for September delivery is quoted at $99 per MT, while for October it is quoted at $101 per MT. With freights going up slightly due to higher demand and high fuel prices, it will be a little expensive to move commodities.
Barley prices in the US for October & November delivery are quoted at $110-120, FOB PNW. (Pacific North West).
The detailed USGC Market perspectives can be seen at
http://www.grains.org/buying/market_perspectives/mp_8-26-05.pdf
The International Grains Council (IGC) estimates, released on Aug 24, 2005 puts the 2005/2006 wheat production at 610 MMT as against 608 MMT set last month, up by 2 MMT. This is due to increase in the estimates for China, Canada, Russia, Kazakhstan and Australia, which will cover dips in production in EU, Pakistan, US and Argentina.
The coarse cereals production has been reduced from 955 MMT of last month to 945 MMT and most of this has been attributed to corn, the production of which is estimated at 661 MMT. USDA estimated the world production at 657 MMT on Aug 12, 2005.
IGC estimates the barley production at 137 MMT as against 133 MMT by USDA. The production is still below last year’s record production of 152 MMT.
Use of renewable resources to increase
Ethanol produced from Grains, poly bags produced from Grains would be the new mantra. With the crude prices going up again and may touch as high as $100 per barrel if reports are to be believed, many economies will not be able to sustain the pressure.
With Government of Maharshtra banning use of plastic bags after the last month flooding being attributed to the petro based plastic bags which do not degrade and block drains etc, poly bags made out of Poly Lactic Acid from Starch (grain) would be more eco friendly. The product range that can be made out of PLA includes, egg trays, water bottles, sheets, food containers. Even panel for car inside, CD covers etc can be made out of PLA granules. The product can be remoulded as a normal Poly Propylene (PP) product, but will be eco friendly. Using paper bags would be an option, but to make paper again trees will need to be felled and paper can not sustain moisture.
Ethanol too can be produced from renewable sources like grains. The first plant in India on commercial lines has come up in Andhra Pradesh by Ammana Bio Pharma Limited and will use sweet sorghum (Sorghum bicolour). The company claims that the raw material cost per unit with use of sweet sorghum will get reduced by 40% compared to use of molasses.
There are many reports which site that ethanol production has a negative energy balance, but there are more reports which suggest that ethanol has a positive energy balance. At the forum organized last week, USDA experts gave a final verdict, “Ethanol's net energy balance is strongly positive, with the fuel producing at least 35 percent to 67 percent more energy than is consumed in making it”. That can go much higher, they said, under some limited circumstances. USDA and other federal studies, as well as University of Nebraska energy audits, found ethanol had a positive energy balance of between 25 percent and 65 percent.
The energy balance exercise is more complex than thought. The energy derived from burning a litre of ethanol can be measured easily. But production inputs include everything from the energy used to produce and spread fertilizer to the cost of bringing the grain to the ethanol plant and then to the gasoline blender. The energy needed to make tractors and combines to harvest the grain is factored in, as is the cost of building the ethanol plant.
In this whole exercise up-to-date figures are very important. New corn varieties, currently in the market in US, yield more and require less attention by machinery, thus using less energy per ton to produce. Modern ethanol manufacture, experts say, uses drastically less energy than in the past.
When ethanol is made, a by-product is dry distiller's grain, an efficient cattle feed. This is at least a partial answer to those who are concerned because a food grain, corn, is being used not to feed the hungry but to make energy.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment