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