Maize prices move up yet again; Efficient Use of Feed Stocks

Maize prices move up yet again

The maize prices in India moved up yet again, this time by about 3.6% over last week, averaging Rs.7400 – 7500 per MT at the market yard. The delivered prices were over Rs.9600 per MT. The prices at the market yard were higher by 24.4% over last year. The highest prices were recorded in Gujarat Rs.8865 per MT at the market yard. While in Tamil Nadu, a major consumption centre the prices moved from Rs.6600 per MT of last week to Rs.7200 per MT, an increase of about 9%.

Pearl Millet (Bajra) prices were down by 1.5% over last week, reaching Rs.6700 – 6800 per MT at the market yard. The prices were also about 1.5% lower than last year. Against corn the prices of pearl Millet were 9.5% lower this week.

Sorghum (Jowar) prices went up by 0.7% over last week at Rs.8700 – 8800 per MT at the market yard. The prices are approximately 30% higher than last year. As against corn the prices are higher by 17%.

Barley prices levelled at Rs.8500 – 8600 per MT at the market yard, and were lower by 9.5% over last week.

The increase in prices of essential commodities, inputs is showing up in the rate of inflation which reached 6.58% in the first week of Feb 2007.

Corn prices at CBOT moved up slightly, with prices rallying at $159.93 (March), $164.56 (May), $167.02 (Jun), $166.98 (Jul). The FOB values (US Gulf) for the future also moved up slightly $179.20 (Feb), $178.45 (Mar), $179.50 (April) and $180.30 (May).

The USDA pegged ending stocks at 19.1 MMT, which was below the average trade estimate of 19.456 MMT. World ending stocks for 2006/2007 were pegged at 87.9 MMT, up from 86.4 MMT posted last month but down from 124.5 MMT last year, almost a drop of 30%. Argentina corn production was revised higher to 21 MMT from 19 million last month, an increase of 2 MMT, and Brazil's production was boosted to 46 MMT from 42 MMT last month. This addition of 6 MMT might help in keeping a check on world maize prices. The total world usage is also likely to jump by 3 MMT in 2007 as the USDA report.

Efficient Use of Feed Stocks

As the prices of commodities skyrocket, it becomes essential to make the best use of the new techniques to enhance the efficiency of production. The US Grains Council in an effort to provide an insight into the new technologies in grain processing invited Professor Vijay Singh, Assistant Professor, Department of Ag. & Biological Engineering, University of Illinois at Urbana-Champaign, USA to India to provide the details to Starch producers.

Under the conventional system it is necessary to soak maize (process called steeping) for at least 24 – 36 hrs and use of Sulfur Di-oxide gas is required. The high use of water, also requires higher capacity effluent treatment plants and as the water is scarce commodity it will be essential to find alternatives.

In the new method, using enzymes, the soaking time has been reduced considerably to 6-8 hrs. In addition, it has been reported in the trails that the average starch yields are higher by 3 – 4%, than the conventional method. In addition the new system allows use of Broken Corn, saves on water and operating costs such as steam (for steeping and steepwater evaporation).

The information will certainly help the starch manufacturer increase the efficiency of production, and is a way to keep a check on prices. Starch and its products are used in daily life and any increase in the price of maize will affect the prices of products needs on a daily basis in homes of millions of Indians.

Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com

Feb 12, 2007