Indian Coarse Grain Prices are Volatile
Maize prices by week ending Oct 27, 2007 reached Rs.6400 - 6500 per MT at the market yard and have been at this value for 2 weeks now. The prices are higher than last year (OCt 2006) prices by about 8%. even with the higher crop. The increased prices are due to higher local/domestic demand and also due to export demand to South East Asian market, specially Malaysia, Vietman and other countries.
Pearl Millet (Bajra) prices are stable between s.6200 - 6400 per MT range by end of Oct 27, 2007 and were higher than last year prices by 10%. Against maize, the prices are lower by just 1%.
Sorghum prices have moved up by over 11% in one week to end at Rs.9700 per MT after reaching a low of Rs.8700 per MT a week before. Prices are higher than 50% over last year and against maize prices are higher by 49%. There are some export querrie for sorghum as well, but at these prices it just may not be feasible to export sorghum.
Barley prices reached Rs.11000 per MT at the market yard and have been going up steadily. Prices are about 38% higher than last year. GOI has fixed a target of 2 MMT of barley for Rabi season, up fro, a production of 1.31 MMT last year. Thebig question though is will the farmers move from wheat to barley as the Minimum Support Price for wheat is higher a Rs.10000 per MT.
Prices in US are high
Fueled by high crude oil prices and increase in ethanol prices from $1.40 per gallon to $1.75 per gallon (on CBOT), corn prices in last 2 weeks have added $7.27 per MT to the rally for Dec delivery (up from $139.18 to $146.45) and $8.26 per MT for Mar 08 delivery (up from $144.78 to $153.04 per MT on CBOT).
FOB US Gulf values for Nov / Dec deliveries were $179.5 per MT and from Pacific North West (PNW) were $196.85 and $198.40 per MT respectevely.
About 60% of corn crop is estimated to be harvested and the harvest is lilkely to proceed faster as the winter fast approaches.
Based on the curret prices of other commodities, Informa Economics have estimated land coverage for next's years crop in US.
They have predicted that U.S. acreage planted to major crops would be as under:
Corn acreage: 85.8 million acres down 7.9 million acres from this year.
Soybean acreage: 71.7 million acres up 8 million acres from this year.
W heat acreage: 63.7 million acres up 3.3 million acres from this year.
Soybean acreage: 71.7 million acres up 8 million acres from this year.
W heat acreage: 63.7 million acres up 3.3 million acres from this year.
This is mainly due to higher soy and wheat prices in the world market
Amit Sachdev
India Representative
U S Grains Council
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