GOI allows imports on Wheat
Duty free import of 500,000 tons of wheat has been allowed by GOI through State Trading Corporation (STC’s), setting a precedence for imports of agri commodities to check the rising commodity prices. Wheat prices in South India has touched a all time high of Rs.12000 ($270) per ton in retail. As the food habits are changing in South India, demand of wheat is rising. The prices in North are also rising and were reported at Rs.9500 ($213) per ton.
As per the reports available, the imports are expected to arrive in about 60 days in the South India ports only, namely., Chennai, Tuticorin, Vishakhapatnam and Kakinada and are meant for South India states.
The arrival of imported wheat will coincide with the procurement of wheat in North India and it will be some time before the wheat from North India makes way to South India. As per GOI the imports are not expected to affect the farmers price and imports will help the end users to buy some time till stocks from North India (domestic) can be routed to South India.
It is not only wheat, whose prices are rising. Maize (corn) prices have also risen and the end users specially the Poultry sector and the starch manufacturers are finding it difficult to procure maize to fulfil their requirements. The crop of corn is expected to arrive in the markets in March/April in Bihar, Tamil Nadu and small crops in Andhra Pradesh and Karnataka. The end users face high prices every year from April to September, which, this year have been from Dec 2005 only.
Average prices for the best red and yellow varieties at the start of the week (Jan 30), were $137 (Rs.6100) per ton and $141 (Rs.6275) per ton. The prices by the end of the week had gone up to $144 (Rs.6400) per ton forred and had remained same from the yellow varieties. Prices of other commodities like Jowar (Grain Sorghum) and Bajra (Pearl Millet) also averaged $150 (Rs.6675) per ton by the end of the week, higher than the maize prices, making it more difficult for the poultry farmers to feed the birds.
If GOI does open imports and takes a duty free route for maize as they have done for wheat, imports are most likely to happen in Kandla (Gujarat) to be used the starch and poultry sector (layer and broilers) in Gujarat, Chennai and Cochin to be used by poultry sector (broiler and layers) in Tamil Nadu, Bombay to be used by the starch and poultry sector in Maharashtra. The end users are sure that if GOI allows imports as in the case of wheat, it will help stabilize the prices by releasing the demand pressure in production states of Karnataka. Even in GOI decides to allows imports, it will happen only in April 2006, when local crop is not available in Gujarat and Maharashtra.
Prices in Gujarat which averaged $136.5 (Rs.6075) per ton in January 2006, started with $140 (Rs.6230) per ton in Feb 2006.
Prices in US are also slowly inching up. CBOT prices for March delivery closed at $88.68 per ton on Feb 03, 2006, up by almost 5.4% than last week close of $84.12 per ton, thus increasing the FOB (US Gulf) price as well to $108.75 per ton for March delivery, an increase of approximately $2.75 per ton. It is highly unlikely that the prices are going to show a down trend in US.
Japan to increase use of bio-fuels and bio-plastics
It is estimated that the demand for bio-fuels will be increasing in Japan by 20% per year. Japan is committed to reduce the greenhouse gas emissions as part of the Kyoto Protocol and the blending will help reduce the carbon-dioxide emissions by almost 600,000 tons per years, reports U S Grains Council office in Japan.
It is not only the biofuels, but also bio-plastics that will help reduce the environment load in Japan. The country used only 12,000 tons of Poly Lactic Acid (PLA) in 2005. Companies are increasing their capacities to use more of bio-plastics for food and beverages packing as it reduces the environment pollution. Bio-plastics will disintegrate in the environment in 35 – 40 days in proper temperature and moisture. Nikkei Biotechnology & Business Review estimates that the market for bio-plastics is worth about $22 million in Japan.
In countries like India, where dumping grounds, drains and fields are chocked with non-biodegradable plastic, use of bio-plastics makes sense. Policy interventions will be required to make it possible for industries to use the environmental friendly technologies, which will help the citizens of the country at large.
Focus on Biotechnology
A new book titled “Let Them Eat Precaution”, written by Jay Byrne, Gregory Conko, Jon Entine, Tony Gilland, Thomas Jefferson Hoban, Patrick Moore, Andrew S. Natsios, Martina Newell-McGloughlin, Robert L. Paarlberg, C. S. Prakash, Carol Tucker Foreman and Edited by Jon Entine, published by American Enterprise Institute for Public Policy Research talks about the communication void between the scientific community, innovators and the so called green groups.
In order that the benefits of the technology seep through to those who are in most need, like the children who die or go blind because of infections, vitamin A deficiency, it is vital that the void is removed. The technology it seems is a victim of a transatlantic cultural and trade war.
Among the key points made in "Let Them Eat Precaution":
-- Cultural politics and trade disputes, not science, pose the biggest hurdles in developing genetically modified products.
-- Countless independent scientific studies have shown that biotech farming can dramatically reduce reliance on costly and environmentally harmful chemicals, with results as safe and healthy as organic products.
-- Bioengineering has created new kinds of soybeans, wheat, and cotton that generate natural insecticides (making them more resistant to pests and drought and increasing yields); nutrition-added fruits, vegetables, and grains; and futuristic "farmaceuticals" -- life-saving medicines made by melding agricultural methods with advanced biotechnology.
-- Even though the National Academy of Sciences issued a report two years ago calling the fears of anti-biotechnology "scientifically unjustified," noting that genetic engineering is "not an inherently hazardous process," opponents -- including well-funded environmental groups such as Greenpeace and Friends of the Earth; organic advocates; religious groups such as Christian Aid; and "socially responsible" investors -- argue that the U.S. government and multinational corporations are ushering in an age of "Frankenfoods."
-- Ironically, while the political battle simmers in Europe and North America, fast-growing countries such as China, India, Brazil, and even Iran are growing record amounts of genetically modified (GM) cotton and rice altered to resist insects which reduces the use of chemical pesticides. The acreage devoted to GM crops is growing at double-digit rates, increasing to 222 million acres last year, although growth in the U.S. and other major farming countries is slowing because of political opposition.
The book review is available at the following link.
http://www.aei.org/books/bookID.842,filter.all/book_detail.asp
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Feb 04, 2006
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