GOI removes duty on maize Imports
As a Republic Day gift to the maize users of India, starch, poultry and livestock, GOI abolished the duty on maize imports into India. Reports available indicate that the maize imports are allowed under zero duty with immediate effect and will be allowed until Dec 31, 2007.
The duty free imports will certainly help in bridging the gap between demand and supply. Though the parity of imports may not be there, sentiments will rule for the next few months in bringing the prices down. The imports are most likely to take place in May - September 2007, which is when the prices will be highest as there is no production during the period. The new crop would be available only in October 2007.
Prices of maize in the market yard touched a new high this week notched up to Rs.7300 – 7400 per MT range. The delivered prices averaged Rs.9100 – 9300 per MT ($206 per MT). The current prices are higher than last year prices by approximately 19%. The futures at NCDEX were also high, Feb Rs.7730; Mar Rs.7880; April Rs.8030; May Rs.8150. The prices are at delivery centres and cost of loading-unloading, transport will need to be added.
Prices on CBOT are similar to last week’s close at $160 per MT. The indicative FOB values for corn out of US Gulf are Feb $173; Mar $175; April $178; May $179 (All prices of per ton basis).
With a boom in the Chinese economy, which grew at 10.7% in 2006, the demand for maize as a basic ingredient for food and feed will be much higher. Reports available indicate that China’s maize demand will outshoot its supply by 4.8 MMT by 2010.
Sorghum (Jowar) prices dipped little (4.8%) over last week to Rs.8300-8400 per MT range at the market yard. The prices are still higher than maize by about 14%. The Sorghum prices are higher than last year’s prices by 21%.
Pearl Millet (Bajra) prices also dipped by 4% reaching a level of Rs.6800 – 6900 per MT, which is about 6.7% lower than maize prices. The prices are lower than last year by 9%.
Barley prices were down over last week by 11% to Rs.7800 – 7900 per MT. The prices are lower than last years prices by 12%. The futures trade of barley on NCDEX was March Rs.8210; April Rs.7500; May Rs.7630; Jun Rs.7840. All prices are on per ton basis.
Growth of Poultry in India
The Indian poultry industry has almost doubled in 6 years. In 2000, the broiler placement in India was 876 million, with the per capita consumption at 0.876 kg. In 2006 the estimated broiler placement for the year is likely to be 1711 million with the per capita consumption slated at 1.76 kg, which is exactly double. The big question though is will be double in the next 6 years?
In 2012 if all goes well and there are no surprises, the broiler placement is projected to reach 2715 million, adding 58.6% in 6 years, with the per capita consumption at 2.52 kg. The average growth would be 9.76% per year.
The first 6 years of 21st century saw a great jump, but it seems that the Indian poultry sector will not be able to sustain that growth, unless the sector changes the way business is conducted. One of the primary reasons attributed to the uneven growth is the stagnation of the live markets. The live markets though can take more birds, but will not grow fast enough than the processed market and will tend to pull the market down.
Another factor which effects the growth in broiler sector is the price of live birds which is controlled by traders rather than the market. The investment in production facilities as new or expansion would not take place unless farmers receive a fair price which is possible under contract growing. Lessons need to be learnt from countries where poultry farmers have benefited from adopting integrated poultry farming system completely, wherein farmers are linked to the market (processor) and the middle men/traders can be eliminated.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Jan 27, 2007
Saturday, January 27, 2007
Saturday, January 20, 2007
Commodity prices high this week; Death bed for live poultry markets; Adoption of Agri-Biotech on an increase
Commodity prices high this week
Maize prices in India soared again this week, reaching levels of Rs.7200 - 7300 per MT at the market yard. The prices are 3.5% higher than last week and about 14% higher than last year prices.
Sorghum (Jowar) prices dipped little (1.4%) over last week to Rs.8700-8900 per MT range at the market yard. The prices are still higher than maize by about 21%.
Pearl Millet (Bajra) prices remained stable at Rs.7100 – 7200 per MT and are similar to maize prices. The prices are just about 2% higher than last year prices. There is some substitution of the pearl millet in poultry rations in north India, especially in layer rations, which might help some poultry operators, but this may not go on for long.
Barley prices shot up this week to Rs.8700 – 8800 per MT range, an increase of 16-17% over last week. The prices though are lower than last year prices by 6%.
The high prices have taken a toll on the inflation, which has hit 6.12% for the week ending Jan 06, 2007. This is the highest rate of inflation in two years. This is much higher than the Reserve Bank of India (RBI) projected inflation of 5 – 5.5% range. One of the major causes of high inflation is the high price of commodities.
It is not only in India that high commodity prices are affecting a common man. In Mexico, where Tortillas are a staple, the prices have shot up by over 400% as per a report. Tortillas are made from corn.
As per a report from China Information Centre, the grain prices may increase by over 6%. The increase is price is being attributed to high input costs, tight world market and drought in Australia.
CBOT prices for corn closed on Friday higher than last week. March delivery $160 per MT (higher by 2.5% over last week), and May delivery $164.54 per MT (High by 2.6% over last week.)
Death bed for live poultry markets
With South East Asia getting a fresh dose of AI cases, it does sound like death knell for the live poultry markets in countries where buying chicken from the live markets is a way of life. In countries like China, Hongkong, Vietnam, Indonesia, Thailand, Cambodia, the governments started the registration of farms and also supervision of the live markets. In certain areas the live markets were completely closed, which did effect the business, but the show must go on.
In Egypt, after the first AI cases were reported, the government ordered complete closure of the live markets. Like in India, Egyptians do prefer to buy freshly cut chicken. Due to HPAI, 30 million birds were culled and slaughtered as per a report.
The sales due to the HPAI outbreak also suffered, and affected lives of the live bird sellers, traders and also the farmers in Egypt. Cairo Poultry Company (CPC), as per a report was slaughtering 110,000 birds/day before the outbreak and reduced the capacity to 70,000 birds/day.
But some of the venders did smell a business opportunity and shifted to selling frozen chicken and value added products, the sales of which are not as good, but they are back in business and the sales are growing. As more outlets for frozen chicken have opened in Egypt, it is more valuable than live chicken and demand is increasing. This has also force CPC to run the plant to full capacity of 110,000 per day and has already made an investment to increase the capacity of the plant to 300,000 birds/day.
The total broiler placement in Egypt is 800 million per year (about 50% that of India), but the acceptance of frozen chicken is fast and Government looking at taking a Public Private Partnership (PPP) route for setting up chicken slaughter houses.
The reason for the drastic change in closing the live markets is not only for the consumer safety, who go to these live markets t purchase a chicken for the family, but public safety at large. There is not way to stop migration of wild birds. These birds can only be tracked and surveillance stepped up. Change in the way business is conducted is possible and that is what most governments are looking at.
Adoption of Agri-Biotech on an increase
As per the report by International Service for the Acquisition of Agri-biotech Application (ISAAA), the total area under biotech crops leaped to 102 million hac (251.94 million acres) in the year 2007. This is a growth of 12 million hac (29.64 million acres), 13.3% increase over 2005 acerage.
One of the primary reasons for this increase has been attributed to the increase profits by the small land holders, who save money by reducing the number of sprays of pesticides and increase in yields attributed to biotech crops.
The most dramatic acceptance has been seen in India, where the increase has been from 1.3 million hac (3.2 million acres) to 3.8 million hac (9.38 million acres), an increase of 2.5 million hac (6.17 million acres) or 192% in one year.
This has also helped India become the fifth largest producer of biotech crops, surpassing China for the first time.
Of the traits and crops whose acreages have increased, Bt Cotton heads the race with the increase in acreage by 63% from 4.9 mill hac to 8 million hac., followed by Bt/HT Maize at 53.8% from 6.5 million hac to 9.0 million hac and HT Maize at 47% from 3.4 million hac to 5.0 million hac.
Of the total 102 million hac land under biotech crops, more than 53.5% land (54.6 million hac) is accounted for in US. The second in the line is Argentina with 18 million hac, followed by Brazil at 11.5 million hac.
ISAAA also estimates that by 2015 the total acerage would be up to 200 million hac and almost 20 million farmers will be benefited from the technology. Currently 10.3 million farmers are utilizing the technology of which almost 90% are in developing nations and are resource poor, small land holders.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Jan 20, 2007
Maize prices in India soared again this week, reaching levels of Rs.7200 - 7300 per MT at the market yard. The prices are 3.5% higher than last week and about 14% higher than last year prices.
Sorghum (Jowar) prices dipped little (1.4%) over last week to Rs.8700-8900 per MT range at the market yard. The prices are still higher than maize by about 21%.
Pearl Millet (Bajra) prices remained stable at Rs.7100 – 7200 per MT and are similar to maize prices. The prices are just about 2% higher than last year prices. There is some substitution of the pearl millet in poultry rations in north India, especially in layer rations, which might help some poultry operators, but this may not go on for long.
Barley prices shot up this week to Rs.8700 – 8800 per MT range, an increase of 16-17% over last week. The prices though are lower than last year prices by 6%.
The high prices have taken a toll on the inflation, which has hit 6.12% for the week ending Jan 06, 2007. This is the highest rate of inflation in two years. This is much higher than the Reserve Bank of India (RBI) projected inflation of 5 – 5.5% range. One of the major causes of high inflation is the high price of commodities.
It is not only in India that high commodity prices are affecting a common man. In Mexico, where Tortillas are a staple, the prices have shot up by over 400% as per a report. Tortillas are made from corn.
As per a report from China Information Centre, the grain prices may increase by over 6%. The increase is price is being attributed to high input costs, tight world market and drought in Australia.
CBOT prices for corn closed on Friday higher than last week. March delivery $160 per MT (higher by 2.5% over last week), and May delivery $164.54 per MT (High by 2.6% over last week.)
Death bed for live poultry markets
With South East Asia getting a fresh dose of AI cases, it does sound like death knell for the live poultry markets in countries where buying chicken from the live markets is a way of life. In countries like China, Hongkong, Vietnam, Indonesia, Thailand, Cambodia, the governments started the registration of farms and also supervision of the live markets. In certain areas the live markets were completely closed, which did effect the business, but the show must go on.
In Egypt, after the first AI cases were reported, the government ordered complete closure of the live markets. Like in India, Egyptians do prefer to buy freshly cut chicken. Due to HPAI, 30 million birds were culled and slaughtered as per a report.
The sales due to the HPAI outbreak also suffered, and affected lives of the live bird sellers, traders and also the farmers in Egypt. Cairo Poultry Company (CPC), as per a report was slaughtering 110,000 birds/day before the outbreak and reduced the capacity to 70,000 birds/day.
But some of the venders did smell a business opportunity and shifted to selling frozen chicken and value added products, the sales of which are not as good, but they are back in business and the sales are growing. As more outlets for frozen chicken have opened in Egypt, it is more valuable than live chicken and demand is increasing. This has also force CPC to run the plant to full capacity of 110,000 per day and has already made an investment to increase the capacity of the plant to 300,000 birds/day.
The total broiler placement in Egypt is 800 million per year (about 50% that of India), but the acceptance of frozen chicken is fast and Government looking at taking a Public Private Partnership (PPP) route for setting up chicken slaughter houses.
The reason for the drastic change in closing the live markets is not only for the consumer safety, who go to these live markets t purchase a chicken for the family, but public safety at large. There is not way to stop migration of wild birds. These birds can only be tracked and surveillance stepped up. Change in the way business is conducted is possible and that is what most governments are looking at.
Adoption of Agri-Biotech on an increase
As per the report by International Service for the Acquisition of Agri-biotech Application (ISAAA), the total area under biotech crops leaped to 102 million hac (251.94 million acres) in the year 2007. This is a growth of 12 million hac (29.64 million acres), 13.3% increase over 2005 acerage.
One of the primary reasons for this increase has been attributed to the increase profits by the small land holders, who save money by reducing the number of sprays of pesticides and increase in yields attributed to biotech crops.
The most dramatic acceptance has been seen in India, where the increase has been from 1.3 million hac (3.2 million acres) to 3.8 million hac (9.38 million acres), an increase of 2.5 million hac (6.17 million acres) or 192% in one year.
This has also helped India become the fifth largest producer of biotech crops, surpassing China for the first time.
Of the traits and crops whose acreages have increased, Bt Cotton heads the race with the increase in acreage by 63% from 4.9 mill hac to 8 million hac., followed by Bt/HT Maize at 53.8% from 6.5 million hac to 9.0 million hac and HT Maize at 47% from 3.4 million hac to 5.0 million hac.
Of the total 102 million hac land under biotech crops, more than 53.5% land (54.6 million hac) is accounted for in US. The second in the line is Argentina with 18 million hac, followed by Brazil at 11.5 million hac.
ISAAA also estimates that by 2015 the total acerage would be up to 200 million hac and almost 20 million farmers will be benefited from the technology. Currently 10.3 million farmers are utilizing the technology of which almost 90% are in developing nations and are resource poor, small land holders.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Jan 20, 2007
Saturday, January 13, 2007
Commodity prices stable this week; Commodities in the world in 2007
Commodity prices stable this week
It has been a quite week on the commodity front, with prices of all major commodities staying stable this week.
The average maize prices this week have been stable at Rs.6900 – 7000 per MT levels at the market yard, though the prices are higher over last year by 12 – 13%.
Pearl Millet (Bajra) prices also stayed at similar levels as they were in the last week (Rs.7000 – 7100 per MT), but the prices are certainly higher than last year by 11.5%. The prices are higher than maize by 2.3%, which is very notional and this helping some small substitution in the layer rations.
Sorghum (Jowar) prices have also remained at levels similar to last week Rs.8800 – 9000 per MT range, but the prices are higher substantially over last year by 17%. As against maize the prices are higher by 27%.
Barley prices in the market yard moved downs ward by about 7.2%. Current prices at the market yard was Rs.7400 – 7600 per MT at the market yard. Some analysts believe that this is a temporary correction and the prices are likely to go up again in the near future. Over last year the prices are lower by 18.5%.
Reports indicate that on the week ending Dec 30, the rate of inflation was 5.58%, which is the highest recorded in these times, though as per RBI this is not alarming. As per the reports the Chicken prices were up by 9% in this week.
Though the commodity prices have been stable the broiler prices have been rising, due to increased demand in all the major markets. Prices in some of the major markets Delhi Rs.45- 47 per kg (live), Hyderabad Rs.42 per kg live, Bombay 40 per kg live, which is good for the farmers, who will be able to cover some of the losses.
The prices of maize in US at CBOT from last weeks, close at $144.95 per MT to %156 per MT this week, a gain of 7.6% over last week. For May 07 delivery, prices of Maize at CBOT was $160.36 per MT.
Commodities in the world in 2007
Despite a bumper maize crop in China, the prices are rising, which will contribute to a rise of 2.5 percent in the country's consumer price index (CPI) in 2007. This is a steep increase on the 1.4 percent predicted for 2006. Reports available indicate that the average grain prices will grow six percent in 2007, outpacing last year's rise and becoming the major contributor to price hikes in 2007.
In order to contain the price rise, China has released 4.3 MMT of grain rom its reserves. The amount is similar to the grain that has been contracted for exports from China. It is also indicated that the prices will not fall until new crops are harvested in the first half of 2007. Other inflationary pressures is the rise in prices of for farming materials -- including fertilizers, pesticides and diesel oil, which are expected to drive up farming costs in 2007.
Report indicate that China’s maize consumption for the year 2007 is likely to rise by 8.2% over 2006 reaching 145 MMT and China would be able to produce a similar quantity (145 MMT) from 27.35 Mill Hactares. This would be an increase of 3 MMT over 2006 production.
Maize production in Brazil is also likely to rise to 45.06 MMT in 2007, an increase of over 8% over last year. This increase has mostly been linked to the high maize prices both on the domestic and international markets, which has led to higher plantings.
As in India, Brazil traditionally grows crops two times a year. The first harvest is likely to be 33.78 MMT, while the second one is expected to be 11.28 MMT.
With the oil prices coming down and expected to reach $45 per barrel in the long run as per some analysts, the debate is now on, as to what will happen to the grain prices. Oil prices are currently running at $60 per barrel. Some analysts believe that the prices of major commodities used for bio fuel Corn, Sugar and Vegetable will see a major correction and will come down. The prices of the above three commodities have risen sharply over the last one year, mainly due to its diversion into the biofuels sector, which has seen huge investments all over the world, more specifically in US. China on the other hand had put a cap on the use of maize for ethanol production to help stabilize the prices in the country.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Jan 13, 2007
It has been a quite week on the commodity front, with prices of all major commodities staying stable this week.
The average maize prices this week have been stable at Rs.6900 – 7000 per MT levels at the market yard, though the prices are higher over last year by 12 – 13%.
Pearl Millet (Bajra) prices also stayed at similar levels as they were in the last week (Rs.7000 – 7100 per MT), but the prices are certainly higher than last year by 11.5%. The prices are higher than maize by 2.3%, which is very notional and this helping some small substitution in the layer rations.
Sorghum (Jowar) prices have also remained at levels similar to last week Rs.8800 – 9000 per MT range, but the prices are higher substantially over last year by 17%. As against maize the prices are higher by 27%.
Barley prices in the market yard moved downs ward by about 7.2%. Current prices at the market yard was Rs.7400 – 7600 per MT at the market yard. Some analysts believe that this is a temporary correction and the prices are likely to go up again in the near future. Over last year the prices are lower by 18.5%.
Reports indicate that on the week ending Dec 30, the rate of inflation was 5.58%, which is the highest recorded in these times, though as per RBI this is not alarming. As per the reports the Chicken prices were up by 9% in this week.
Though the commodity prices have been stable the broiler prices have been rising, due to increased demand in all the major markets. Prices in some of the major markets Delhi Rs.45- 47 per kg (live), Hyderabad Rs.42 per kg live, Bombay 40 per kg live, which is good for the farmers, who will be able to cover some of the losses.
The prices of maize in US at CBOT from last weeks, close at $144.95 per MT to %156 per MT this week, a gain of 7.6% over last week. For May 07 delivery, prices of Maize at CBOT was $160.36 per MT.
Commodities in the world in 2007
Despite a bumper maize crop in China, the prices are rising, which will contribute to a rise of 2.5 percent in the country's consumer price index (CPI) in 2007. This is a steep increase on the 1.4 percent predicted for 2006. Reports available indicate that the average grain prices will grow six percent in 2007, outpacing last year's rise and becoming the major contributor to price hikes in 2007.
In order to contain the price rise, China has released 4.3 MMT of grain rom its reserves. The amount is similar to the grain that has been contracted for exports from China. It is also indicated that the prices will not fall until new crops are harvested in the first half of 2007. Other inflationary pressures is the rise in prices of for farming materials -- including fertilizers, pesticides and diesel oil, which are expected to drive up farming costs in 2007.
Report indicate that China’s maize consumption for the year 2007 is likely to rise by 8.2% over 2006 reaching 145 MMT and China would be able to produce a similar quantity (145 MMT) from 27.35 Mill Hactares. This would be an increase of 3 MMT over 2006 production.
Maize production in Brazil is also likely to rise to 45.06 MMT in 2007, an increase of over 8% over last year. This increase has mostly been linked to the high maize prices both on the domestic and international markets, which has led to higher plantings.
As in India, Brazil traditionally grows crops two times a year. The first harvest is likely to be 33.78 MMT, while the second one is expected to be 11.28 MMT.
With the oil prices coming down and expected to reach $45 per barrel in the long run as per some analysts, the debate is now on, as to what will happen to the grain prices. Oil prices are currently running at $60 per barrel. Some analysts believe that the prices of major commodities used for bio fuel Corn, Sugar and Vegetable will see a major correction and will come down. The prices of the above three commodities have risen sharply over the last one year, mainly due to its diversion into the biofuels sector, which has seen huge investments all over the world, more specifically in US. China on the other hand had put a cap on the use of maize for ethanol production to help stabilize the prices in the country.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Jan 13, 2007
Saturday, January 06, 2007
Maize prices move up at the start of year; What is happening on ethanol?
Maize prices move up at the start of year
At the start of the New Year, the maize prices all across the country notched up a bit, reaching Rs. 6900 – 7000 per MT at the market yard on an average. The prices are about 2.3% higher than last week of Dec 2006. The prices at the market yard were higher than last year prices in the first week of Jan 2007 by 19%. Delivered prices averaged Rs.8700 – 9000 per MT. It is unlikely that the prices would come down for the next one month.
Pearl Millet (Bajra) prices did come down by about 5% over last week to Rs.7000 per MT at the market yard, but are still higher than last year by 5.5%. Ag against maize, the prices are higher by just 1.4%, making substitution in poultry rations just possible, but only in few states where the commodity is available. In the long run, prices of Pearl Millet are also expected to rise, if demand from poultry sector shoots up and its use at human food in Rajasthan, Madhya Pradesh also goes up.
Sorghum (Jowar) prices moved up over last week by 15%, highest increase so far, reaching a level of Rs.8700 – 8900 per MT at the market yard. The prices are higher over last year by 28%. As against maize, the prices of sorghum were higher by 26%, making substation impossible.
Barley prices in the market yard have also moved up over last week by 4.5% to Rs.8000 – 8200 per MT range. Delivered prices were close to Rs.9000 – 10000 levels. The prices are the market yard are though 3.5% lover than last year, during the same time.
The prices of maize in US at CBOT this week closed at $144.95 per MT, down by $8.65 per MT, approximately 5.6% over last week of Dec 2006. The FOB values (US Gulf) for the next few months are Jan $158; Feb $161.5; Mar $163.5, April $166.45 per MT.
The detailed market perspectives for January 5 from US Grains Council can be found at the following link.
http://www.grains.org/galleries/market_perspectives/mp_%201_5_07.pdf
What is happening on ethanol?
It is fight for food against energy, as some would say. But in both cases, it is a fight for survival for the people. While China plans to limit the use of corn to be converted to ethanol, new capacities in US are coming online in 2007 – 2008.
The current capacity of ethanol production in US is 20 billion liters and it would add would add another 22 billion liters by 2008, overshooting the mandated 28 billion liters by 2012. It would also increase the demand of corn in US by 25.4 MMT every year. The Renewable Fuels Association (RFA) believes that US ethanol plants would use 60 MMT of corn by 2008. If one goes by the figures put out by Earth Policy Institute (EPI), the figure would be 139 million, which may be exaggerated.
But whatever may be the case, the demand is on the rise, for both livestock feed, food and fuel and its will be the fight for survival for all businesses. Some reports also indicate that if the demand and supply is to be balanced about 6 – 7 million acres will need to be added every year in US. In such a situation price is not the criterion, but availability of the commodity would be the biggest concern.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Jan 06, 2007
At the start of the New Year, the maize prices all across the country notched up a bit, reaching Rs. 6900 – 7000 per MT at the market yard on an average. The prices are about 2.3% higher than last week of Dec 2006. The prices at the market yard were higher than last year prices in the first week of Jan 2007 by 19%. Delivered prices averaged Rs.8700 – 9000 per MT. It is unlikely that the prices would come down for the next one month.
Pearl Millet (Bajra) prices did come down by about 5% over last week to Rs.7000 per MT at the market yard, but are still higher than last year by 5.5%. Ag against maize, the prices are higher by just 1.4%, making substitution in poultry rations just possible, but only in few states where the commodity is available. In the long run, prices of Pearl Millet are also expected to rise, if demand from poultry sector shoots up and its use at human food in Rajasthan, Madhya Pradesh also goes up.
Sorghum (Jowar) prices moved up over last week by 15%, highest increase so far, reaching a level of Rs.8700 – 8900 per MT at the market yard. The prices are higher over last year by 28%. As against maize, the prices of sorghum were higher by 26%, making substation impossible.
Barley prices in the market yard have also moved up over last week by 4.5% to Rs.8000 – 8200 per MT range. Delivered prices were close to Rs.9000 – 10000 levels. The prices are the market yard are though 3.5% lover than last year, during the same time.
The prices of maize in US at CBOT this week closed at $144.95 per MT, down by $8.65 per MT, approximately 5.6% over last week of Dec 2006. The FOB values (US Gulf) for the next few months are Jan $158; Feb $161.5; Mar $163.5, April $166.45 per MT.
The detailed market perspectives for January 5 from US Grains Council can be found at the following link.
http://www.grains.org/galleries/market_perspectives/mp_%201_5_07.pdf
What is happening on ethanol?
It is fight for food against energy, as some would say. But in both cases, it is a fight for survival for the people. While China plans to limit the use of corn to be converted to ethanol, new capacities in US are coming online in 2007 – 2008.
The current capacity of ethanol production in US is 20 billion liters and it would add would add another 22 billion liters by 2008, overshooting the mandated 28 billion liters by 2012. It would also increase the demand of corn in US by 25.4 MMT every year. The Renewable Fuels Association (RFA) believes that US ethanol plants would use 60 MMT of corn by 2008. If one goes by the figures put out by Earth Policy Institute (EPI), the figure would be 139 million, which may be exaggerated.
But whatever may be the case, the demand is on the rise, for both livestock feed, food and fuel and its will be the fight for survival for all businesses. Some reports also indicate that if the demand and supply is to be balanced about 6 – 7 million acres will need to be added every year in US. In such a situation price is not the criterion, but availability of the commodity would be the biggest concern.
Amit Sachdev
Representative
U S Grains Council, India
bluecross303@gmail.com
Jan 06, 2007
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