Maize Prices skyrocket
This week the prices of maize in the Indian market notched another high reaching an average price of Rs.6960 ($151.3) per MT. The delivered price of maize in Sangli (South Maharashtra) was Rs.9800 ($213) per MT, making it impossible for the poultry farmers to use maize in the poultry rations. The increase in the market yard price is about 5.2% in one week. The price is also higher than last year’s price of $133.5 by 13.34%.
In the current situation, when the Indian subcontinent is under severe drought in some parts and floods in some other parts, it has been difficult to assess the maize production. The new crop is likely to arrive in mid Oct 2006, which is still 45 days away.
Though the GOI has notified release of another 350,000 tons of maize from its go-downs, it will be difficult to bridge the gap between supply and demand. GOI has also stated that it is not averse to look at need based imports as it is doing for wheat.
In the recently concluded 48th National Symposium of CLFMA of India, the GOI officials present the discussions were appraised of the current maize situation and the hardships being faced by them due to the price increase. On one side the cost of production of chicken (live) is up to Rs.30 – 32 per kg, the sale price of live chicken in the market has come down drastically and the farmers are forced in sell chicken at a low price of Rs.17 – 24 at various locations, thus incurring a loss of Rs.8-15 per kg.
The CBOT on last Friday, Aug 25, closed a little higher than last week, with Sept corn at $88.56 per MT over last week’s $86.19, an increase of $2.37 per MT. Dec corn also closed higher by $2.36 per MT at $95.15 per MT.
The FOB values of corn at US Gulf are reported at $118.10 per MT for Sept Delivery, $121.95 per MT for Oct, $122.35 for MT for Nov and $123.15 for December 2006 deliveries.
It may still be possible to for Indian end users to import maize, but it might not be a very low price, but at least maize will be available to run the starch mills and feed the birds in animals in states which have high usage of maize and also have ports, like Gujarat, Maharashtra, Tamil Nadu and West Bengal. Without the duty of 15%, it may be possible to deliver corn at the port (CNF) at $168 (Rs.7900) per MT, which with the duty will be $193 (Rs.9070) per MT. Added cost of clearance, delivery would be an additional Rs.1200 per ton. It may just be possible to make maize available to the end users at a price lower than the current delivered price.
Market reports indicate that consumers and end users are finding it difficult to source value added products like Malto-dextrin, Dextrose, Glucose etc, as the production of these is affected, as the companies have reduced their capacity utilization to be at a bare minimum and run the plants. The prices of these products are also on the rise and will definitely affect the end users bottom line and eventually the consumers. It is high time GOI considers import of maize to stem the price increase as has been done with the wheat.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Aug 30, 2006
Wednesday, August 30, 2006
Sunday, August 20, 2006
Maize Prices unaffordable; New uses of Biotech Maize
Maize Prices unaffordable
The price of maize this week reached a highest level of Rs.6614 ($143.8) per MT, up from last week’s Rs.6350 ($138.1) per MT, an increase of 4.1%. In the last two weeks the price of maize in the local market has gone up from Rs.6237 ($135.6) to Rs.6614 ($143.8) per MT. The delivered prices in parts of Maharashtra touched a all time of high of Rs.8800 ($191) to Rs.9000 ($195) per MT, making the usage of corn unaffordable in the poultry rations. The price of maize in the market yard is also higher than last year by 13.5%. Last year the price of maize at this time of the year was Rs.5825 ($126.6) per MT.
Reports also indicate that the price of Bajra (Pearl Millet) in the local markets has gone up from Rs.6040 ($131.4) to Rs.7160 ($155.71) per MT, an increase of 18.5%. The price of Bajra is still higher than maize by 8.3% and last week the price of Bajra was lower than maize by 4.8%.
Sorghum prices on the other hand have come down from last week’s Rs.7400 ($161) to Rs.7100 ($154.28) per MT at the market yard, a drop of 4.17%. The price though is higher than last year’s Rs.6900 ($150) per MT. Even though the price of Sorghum has come down in the market yard, it is still higher than maize price in the market yard by 7.3%, making corn the best choice for the poultry rations.
Barley prices this week gained almost Rs.920 ($20) per MT reaching a high of Rs.7790 ($169.39) per MT at the market yard, an increase of 13.3%. The prices are also higher than last year’s prices by almost 17.14%.
With such high commodity prices, it is getting difficult for the end users to use these commodities for poultry or starch manufacturer.
With the current drop in prices of broilers and increase in cost of production due to increase in ingredient prices, it is likely that few of the farmers will close shop. With in the starch sector there is a possibility of increase in prices of starch and its value added products like dextrose etc which will be reflected in price increase of other products as well like processed foods, paper where starch is used and also health care products where dextrose and starch is used.
Maize may not be so much of direct use as wheat for human consumption, but it surely feeds the chickens and is the base stock for many industries, which in turn provides employment opportunities to many Indian people. A short supply of a particular commodity and its high prices will surely get reflected in the overall growth of the country.
While the prices in India may be increasing, prices in US at CBOT have shown a decline in the last two weeks. This week, CBOT closed at $86.43, lower than the previous week’s $87.53 per MT for September delivery. December corn was also down from $95.90 to $92.73 per MT.
While the demand for cereals in on the rise, a report by Rabo Bank projects an increase in us of Vegetable oil by 27% over a 5 year period (2006-2010). The reason for this increase will be due t o increase in world population and income, which will account for a 14% rise in use. The 13% rise will be due to the increased use of vegetable oil to manufacture biofuels.
The report also cited that the highest population and economic growth in the last 10 years has happened in India and China.
New uses of Biotech Maize
As the acceptance of crops derived from biotechnology is increasing, new uses of the technology are being found. While there are reports than vaccines can be administered to children via a GM Banana and Tomatoes can be modified to have increase Lycopene, required to fight cancer, Mexican researchers have proved that GM maize that has New Castle Vaccine.
A report published in Transgenic Research, indicates that the researchers of Center for Research and Advanced Studies (CINVESTAV) in Guanajuato, Mexico inserted a gene from the Newcastle disease virus into maize DNA. The chicken that were fed on the altered/modified maize produced antibodies against the virus. The maize provided a level of protection against infection comparable to that of commercial vaccines.
New Castle disease is an important disease of Poultry and effects millions of poultry birds worldwide. Though commercial vaccines are available, outbreaks are known to occur and there are times when booster doses of the vaccine have to be given at regular intervals. Providing the vaccine through Genetically Modified maize will help fight the disease and reduce losses due to morbidity and mortality.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Aug 19, 2006
The price of maize this week reached a highest level of Rs.6614 ($143.8) per MT, up from last week’s Rs.6350 ($138.1) per MT, an increase of 4.1%. In the last two weeks the price of maize in the local market has gone up from Rs.6237 ($135.6) to Rs.6614 ($143.8) per MT. The delivered prices in parts of Maharashtra touched a all time of high of Rs.8800 ($191) to Rs.9000 ($195) per MT, making the usage of corn unaffordable in the poultry rations. The price of maize in the market yard is also higher than last year by 13.5%. Last year the price of maize at this time of the year was Rs.5825 ($126.6) per MT.
Reports also indicate that the price of Bajra (Pearl Millet) in the local markets has gone up from Rs.6040 ($131.4) to Rs.7160 ($155.71) per MT, an increase of 18.5%. The price of Bajra is still higher than maize by 8.3% and last week the price of Bajra was lower than maize by 4.8%.
Sorghum prices on the other hand have come down from last week’s Rs.7400 ($161) to Rs.7100 ($154.28) per MT at the market yard, a drop of 4.17%. The price though is higher than last year’s Rs.6900 ($150) per MT. Even though the price of Sorghum has come down in the market yard, it is still higher than maize price in the market yard by 7.3%, making corn the best choice for the poultry rations.
Barley prices this week gained almost Rs.920 ($20) per MT reaching a high of Rs.7790 ($169.39) per MT at the market yard, an increase of 13.3%. The prices are also higher than last year’s prices by almost 17.14%.
With such high commodity prices, it is getting difficult for the end users to use these commodities for poultry or starch manufacturer.
With the current drop in prices of broilers and increase in cost of production due to increase in ingredient prices, it is likely that few of the farmers will close shop. With in the starch sector there is a possibility of increase in prices of starch and its value added products like dextrose etc which will be reflected in price increase of other products as well like processed foods, paper where starch is used and also health care products where dextrose and starch is used.
Maize may not be so much of direct use as wheat for human consumption, but it surely feeds the chickens and is the base stock for many industries, which in turn provides employment opportunities to many Indian people. A short supply of a particular commodity and its high prices will surely get reflected in the overall growth of the country.
While the prices in India may be increasing, prices in US at CBOT have shown a decline in the last two weeks. This week, CBOT closed at $86.43, lower than the previous week’s $87.53 per MT for September delivery. December corn was also down from $95.90 to $92.73 per MT.
While the demand for cereals in on the rise, a report by Rabo Bank projects an increase in us of Vegetable oil by 27% over a 5 year period (2006-2010). The reason for this increase will be due t o increase in world population and income, which will account for a 14% rise in use. The 13% rise will be due to the increased use of vegetable oil to manufacture biofuels.
The report also cited that the highest population and economic growth in the last 10 years has happened in India and China.
New uses of Biotech Maize
As the acceptance of crops derived from biotechnology is increasing, new uses of the technology are being found. While there are reports than vaccines can be administered to children via a GM Banana and Tomatoes can be modified to have increase Lycopene, required to fight cancer, Mexican researchers have proved that GM maize that has New Castle Vaccine.
A report published in Transgenic Research, indicates that the researchers of Center for Research and Advanced Studies (CINVESTAV) in Guanajuato, Mexico inserted a gene from the Newcastle disease virus into maize DNA. The chicken that were fed on the altered/modified maize produced antibodies against the virus. The maize provided a level of protection against infection comparable to that of commercial vaccines.
New Castle disease is an important disease of Poultry and effects millions of poultry birds worldwide. Though commercial vaccines are available, outbreaks are known to occur and there are times when booster doses of the vaccine have to be given at regular intervals. Providing the vaccine through Genetically Modified maize will help fight the disease and reduce losses due to morbidity and mortality.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Aug 19, 2006
Monday, August 14, 2006
Maize Prices up on slow deliveries and high demand; India free of Bird Flu
Maize Prices up on slow deliveries and high demand
Average maize prices in India suddenly shot up from last weeks Rs.6240 ($135.6) per MT to Rs.6350 ($138) per MT. The prices are likley to go up further as the most of the routes to production centres are cut of due to heavy rains in Central India in the last few days. Rains have also caused havoc in parts of Gujarat, Maharashtra, Andhra Pradesh and Orissa.
Prices of maize in major consumption and production centres like Andhra Pradesh are up from $ 122 to $ 130, Gujarat from $ 150 to $154, Karnataka $ 123 to $ 134, Tamil Nadu $ 135 to $ 137, Uttar Pradesh $ 135 to $ 141 (All prices at market yard in respective states). With less availability and higher prices, it is getting more and difficult for the end users to use corn and keep profit margins.
Prices of Pearl Millet slid down after a long time from $139.3 to $131.4 per MT, but it is still not feasible to use the grain against corn as the prices only 5% lower than corn.
Prices of Sorghum are again up from last weeks $156.4 to $161 per MT and are higher than last years price of $153.7 per MT at the same time. The prices are higher than maize by 15% and does not warrant a change in the poultry rations.
Barley prices are also showing a down trend and were at $149.5 per MT by the end of the week, lower than last week by almost $2.5 Per MT.
Prices in US on the other hand have softened and CBOT closed at $88.4 per MT for September delivery, much lower than last weeks close of $96.43. This is probably due to the new estimates from USDA on corn production, which is now estimated at 10.976 billion bushels (278 million metric tons), possibly the third largesy crop in US history.
India free of Bird Flu
Government of India in its most recent report to OIE dated Aug 11, 2006 sas stated that it is now free of bird flu. The document can be found on the weblink as under:
http://dahd.nic.in/flu/OIEfinal.doc
The document clearly indicates that since the last known outbreak of H5N1 which occurred on April 18, 2006 and the subsequent cleaning and culling operations which were completed on May 07, 2006, no new cases of Highly Pathogenic Avian Influenza have been deteced in the country.
The disease free status will help the industry to get back to it feet and the exports will finally start. It is likley to help in better placements of broilers and also layers in major layer belts from where exports of eggs to Middle east countries take place namely Tamil Nadu and Andhra Pdeash. Export of Hatching eggs, chicks to Middle East, Nepal and Bangladesh was also effected which will hopefully open their doors for Indian prodcuts.
Just prior to the bird flu episode in Feb 2006, Indian poultry processing plants had received clearances from Japanese govermnent to export poultry meat to Japan. The diasease free status will help in getting back to export of poultry meat to this market as well.
Even though India has declared itself free of Avian Influenza, the surveillance of the poultry belts should continue and awareness regading reporting the diseases must be created, which will help in nipping the crisis early if it happens again.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Aug 12, 2006
Average maize prices in India suddenly shot up from last weeks Rs.6240 ($135.6) per MT to Rs.6350 ($138) per MT. The prices are likley to go up further as the most of the routes to production centres are cut of due to heavy rains in Central India in the last few days. Rains have also caused havoc in parts of Gujarat, Maharashtra, Andhra Pradesh and Orissa.
Prices of maize in major consumption and production centres like Andhra Pradesh are up from $ 122 to $ 130, Gujarat from $ 150 to $154, Karnataka $ 123 to $ 134, Tamil Nadu $ 135 to $ 137, Uttar Pradesh $ 135 to $ 141 (All prices at market yard in respective states). With less availability and higher prices, it is getting more and difficult for the end users to use corn and keep profit margins.
Prices of Pearl Millet slid down after a long time from $139.3 to $131.4 per MT, but it is still not feasible to use the grain against corn as the prices only 5% lower than corn.
Prices of Sorghum are again up from last weeks $156.4 to $161 per MT and are higher than last years price of $153.7 per MT at the same time. The prices are higher than maize by 15% and does not warrant a change in the poultry rations.
Barley prices are also showing a down trend and were at $149.5 per MT by the end of the week, lower than last week by almost $2.5 Per MT.
Prices in US on the other hand have softened and CBOT closed at $88.4 per MT for September delivery, much lower than last weeks close of $96.43. This is probably due to the new estimates from USDA on corn production, which is now estimated at 10.976 billion bushels (278 million metric tons), possibly the third largesy crop in US history.
India free of Bird Flu
Government of India in its most recent report to OIE dated Aug 11, 2006 sas stated that it is now free of bird flu. The document can be found on the weblink as under:
http://dahd.nic.in/flu/OIEfinal.doc
The document clearly indicates that since the last known outbreak of H5N1 which occurred on April 18, 2006 and the subsequent cleaning and culling operations which were completed on May 07, 2006, no new cases of Highly Pathogenic Avian Influenza have been deteced in the country.
The disease free status will help the industry to get back to it feet and the exports will finally start. It is likley to help in better placements of broilers and also layers in major layer belts from where exports of eggs to Middle east countries take place namely Tamil Nadu and Andhra Pdeash. Export of Hatching eggs, chicks to Middle East, Nepal and Bangladesh was also effected which will hopefully open their doors for Indian prodcuts.
Just prior to the bird flu episode in Feb 2006, Indian poultry processing plants had received clearances from Japanese govermnent to export poultry meat to Japan. The diasease free status will help in getting back to export of poultry meat to this market as well.
Even though India has declared itself free of Avian Influenza, the surveillance of the poultry belts should continue and awareness regading reporting the diseases must be created, which will help in nipping the crisis early if it happens again.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Aug 12, 2006
Sunday, August 06, 2006
Maize availability - a big issue; Broilers in India – post AI episode
Maize availability - a big issue
Though the average price of maize at the market yard may not have gone up from last week’s Rs.6240 ($135.6) per MT, the availability of stocks sure is a major issue for the end users in non production areas like Gujarat, where average prices have moved up and delivered prices are close to Rs.7500 ($163) per MT. In the days to come the prices are likley to go up.
Prices in Bihar have also firmed up and are up from last weeks Rs.5610 ($122) per MT to Rs.5840 ($127) per Mt at the market yard. With renewed monsoon activity and heavy showers in South Maharashtra, Karnatak and in Andhra Pradesh, the likleyhood of standing crop getting affected is very high.
The prices of other coarse cereals, sorghum, bajra and barley have remained stable in the past week at Rs.7190 ($156.4) per MT, Rs.6430 ($139.8) per MT and Rs.6990 ($151.9) per MT respectively at the market yard. As the prices of sorghum is still about 15.3% higher than maize, the poultry sector is unable to utilize sorghum instaed of maize in the rations.
Prices at CBOT closed a $3.03 per MT higher than last week at $96.43 per MT for September delivery.
Due to heavy rains in the maize production areas, resowing may be required, which would also mean late harvest and lwo production. As the season would be delayed and arrivals would be only in November 2006, which is still 3 months from now. The price increase would be anybody’s guess.
While on one side there has been discussions about diversification in agriculture and farmers have been asked to move away from wheat – rice cultivation to oter crops, reports indicate that the situation for wheat is likely to worsen by 2012. GOI is contempelating schemes to bring in more land under wheat particularly in Gujarat, Madhya Pradesh, Maharashtra and Bihar.
Broilers in India – post AI episode
Even though it has been over 5 months since the bird flu episode occurred in India, the poultry sector has not been able to come to terms with it. With losses being estimated at Rs.3000 crores ($0.65 billion), the industry which had placed 140 million broilers in Jan 2006, industry estimates suggest that the placement in March 2006 was down to 85 million broilers. The overall estimates for broiler placement for the financial year 2005-06 were pegged at 1694 million broilers was cut short to 1611 millions due to the bird flu episode. The growth which was estimated at 10.28% pre AI, is now 4.88%. There may still be time to cover the lost ground and partly cover some of the the losses in broiler placements and reach the end of 2005-06 level of 1694 million.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Aug 05, 2006
Though the average price of maize at the market yard may not have gone up from last week’s Rs.6240 ($135.6) per MT, the availability of stocks sure is a major issue for the end users in non production areas like Gujarat, where average prices have moved up and delivered prices are close to Rs.7500 ($163) per MT. In the days to come the prices are likley to go up.
Prices in Bihar have also firmed up and are up from last weeks Rs.5610 ($122) per MT to Rs.5840 ($127) per Mt at the market yard. With renewed monsoon activity and heavy showers in South Maharashtra, Karnatak and in Andhra Pradesh, the likleyhood of standing crop getting affected is very high.
The prices of other coarse cereals, sorghum, bajra and barley have remained stable in the past week at Rs.7190 ($156.4) per MT, Rs.6430 ($139.8) per MT and Rs.6990 ($151.9) per MT respectively at the market yard. As the prices of sorghum is still about 15.3% higher than maize, the poultry sector is unable to utilize sorghum instaed of maize in the rations.
Prices at CBOT closed a $3.03 per MT higher than last week at $96.43 per MT for September delivery.
Due to heavy rains in the maize production areas, resowing may be required, which would also mean late harvest and lwo production. As the season would be delayed and arrivals would be only in November 2006, which is still 3 months from now. The price increase would be anybody’s guess.
While on one side there has been discussions about diversification in agriculture and farmers have been asked to move away from wheat – rice cultivation to oter crops, reports indicate that the situation for wheat is likely to worsen by 2012. GOI is contempelating schemes to bring in more land under wheat particularly in Gujarat, Madhya Pradesh, Maharashtra and Bihar.
Broilers in India – post AI episode
Even though it has been over 5 months since the bird flu episode occurred in India, the poultry sector has not been able to come to terms with it. With losses being estimated at Rs.3000 crores ($0.65 billion), the industry which had placed 140 million broilers in Jan 2006, industry estimates suggest that the placement in March 2006 was down to 85 million broilers. The overall estimates for broiler placement for the financial year 2005-06 were pegged at 1694 million broilers was cut short to 1611 millions due to the bird flu episode. The growth which was estimated at 10.28% pre AI, is now 4.88%. There may still be time to cover the lost ground and partly cover some of the the losses in broiler placements and reach the end of 2005-06 level of 1694 million.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Aug 05, 2006
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