Coarse cereal prices lower across the board and sowing trails

Coarse cereal prices lower across the board and sowing trails

Maize prices moved lower by about 2.7% this week on an average at the market yards. Prices were average at Rs.8790 per MT. The prices though are higher than last year by about 18%. One of the reasons being attributed to the lower maize prices is the wait and watch adopted by the large end users, poultry, starch and feed sector. There is also an issue that poultry industry is going through a slowdown, which has affected the purchases.

On the futures front the, prices were down of Sept – Nov deliveries by 0.5 to 2.5% and were up for Dec delivery by about 1%. In the SPOT markets of Davangere, Karimnagar and Nizamabad, also the prices tumbled by about 2.5 – 3.7%.

Pearl Millet prices were down by 3.1% this week, to Rs.7375, but were 8.2% higher over last year. Against maize, the prices were lower by about 19% at the market yard.

Sorghum prices were also down by 1.3% to Rs.10730 per MT., but 14% higher than last year. Prices were about 18% higher than maize at the market yard.

Barley prices moved by this week at the market yard by 1.4%, average at Rs.10,130 per MT. Prices were 20.3% higher than last year at the market yard.

The new sowing data released by Ministry of Agriculture (Aug 21, 2008) shows maize sowing trailing by 7.1% (6.664 mil hac in 2008 against 7.178 Mill hac in 2007). States where the decline has been prominent include Andhra Pradesh, Kanataka and Maharashtra. Total coarse cereal area is down by 9.78% and pulses by 15.32%. Only Oilseed area is up by 0.71 and Rice by 6.94.

Corn prices on CBOT were up slightly for Sept and Dec deliveries at $230.85 and $238.72 per MT respectively.

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

Coarse grains prices show mixed response; Corn production predicted to be higher in US

Coarse grains prices show mixed response

Maize prices were down by 0.63% over last week and were close to Rs.9030 per MT. The prices though were about 17% higher than last year. Future prices for Aug / Sept were up by 2.8 – 2.9% over last weeks close, and spot prices at Davangere were also up by 0.4%. Other location the prices were either stable or down slightly. One of the reasons being attributed to stable prices is slowdown in demand from poultry, at least for some time. Poultry prices are down and cost of production being high, farmers not putting any stocks of broilers. Also the pickup is slow, as per report from Andhra Pradesh, Karnataka, Maharashtra, where the people turn vegetarians for 30 days during the religious festival in August – September.

Pearl Millet prices were down by 5.4% to Rs.7615 per MT, but about 13% higher than last year. Prices are about 18.6% lower than maize in the Mandi.

Sorghum prices moved up to Rs.4.5% over last week to Rs.10880 per MT. Prices are about 11.3% higher than last year and 17% higher than maize.

Barley prices were down by 8.7% this week to Rs.9990 per MT at the market yard. Prices were 22% higher than last year. Report that most of the end users are covered and the export demand being slow, is being attributed to downtrend in prices.

Corn prices on CBOT closed at $208 – 216 per MT for Sept – December delivery. The prices were lower than last week. The low prices have been attributed to slide in oil prices.

Corn production predicted to be higher in US

Despite the worst flooding in 15 years, which occurred in the Midwest, the farmers in US are projected to produce a record crop, says a USDA report. The latest WASDE, report released Aug 12, 2008 estimates corn production in US to touch about 313 MMT, against last month’s estimates of 297 MMT and increase of 4.9% over last week’s estimates. The weather in the last one month has been excellent and this will be beneficial to corn.

The ending stocks are still a worry and will be close to 28 MMT, against last years 40 MMT. There is speculation about the 104 MMT of corn use (33% of production) in ethanol, up from 76 MMT (22.9% of production) last year. As the corn prices were record high, there was an issue that some new ethanol plants may not see the light of the day, but with corn prices coming down to close to close to $200 per MT and stabilizing, the profits have increased and the ethanol plants are back in production.

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

Commodity prices stay firm; Year of food safety and quality

Commodity prices stay firm

Maize prices averaged Rs.9090 per MT at the market yard this week, up by about 1% this week. But the prices were 17% higher than last year. In the futures market (NCDEX), the futures were down by 4-8%, max being for Sept by 8%. In the spot markets of Nizamabad and Karimnagar prices were down by 3%, while in Davangere they are up by 3% at Rs.10760 per MT.

Pearl Millet (Bajra)) prices were up by 1.8% to Rs.8050 per MT of demand from poultry sector, specially the layer segment. Prices are up by 15% over last year. Against maize the price are lower by 13%. The prices have moved up only due to pressure of buying.

Sorghum (jowar) prices on the other hand were down by 8.5%, to Rs.10409 at the market yard, but 11.7% higher than last year. And 12.7% above maize prices.

Barley prices moved up substantially this week to Rs.10,944 at the market yard, add 6.4% to its tally. The prices were 30.5% above last year values. On NCDEX, the futures were lower by 2-5% over last week and also in the spot market the prices were reported lower by 1%.

There has been extensive amount of rain this week all over the country and this may be good news for some areas, bur the flood situation in some areas could be an issue. Farmers are still out there planting gains, oilseeds etc and we can expect a good crop in the long run.

Corn prices on CBOT were below 200 levels for SEPT delivery ($196.20), a drop of 11.8% over last week. Dec corn was also at $204 per MT, losing 11.3% in the rally.

Year of food safety and quality

The year 2008/09 has been declared as the YEAR OF FOOD SAFETY AND QUALITY, by Government of India. As citizens of the country, customers and part of the food industry, let us join hands and do what we can to make this a year what it is meant to be be.

Lets try to make simple changes in the way we see food products (produce, transport, store and sell) and one small change of keep temperature as per the requirement and general cleanliness can make a different.

It is not a one man's job, but a collective effort that can help every one. If China can think of doing such a spectacular show, make changes in the system and adopt food safety systems, India too can do that, and with Food Safety and Standards Authority (FSSA) now a reality, it is more important that its hands are strengthened.

What do you think needs to be done in the meat sector (production, distribution, retail, customer level). If you have any suggestions, do write in with reasoning and these will be put together and put on the blog, for wider circulation and discussion.

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

Commodity prices do not relent; Poultry Processing and waste management; DDGS can lower cost of production

Commodity prices do not relent

Inflation is just a kissing distance away from 12% (11.98%). Commodity prices – specially coarse grain prices have risen further and there is no escape for the end-users – poultry, starch and livestock.

Maize prices moved up by 4.7% on an average at the market yard, crossing the Rs.9000 per MT mark for loose material. The prices are about16.5% above the last year prices. In some areas of Karnataka, Tamil nadu, delivered prices are close to Rs.12,200 – 12,500 per MT. For the month of July 2008, the average price of maize at the Market yard was Rs.8485 per MT against Rs.7442 per MT in July 2008, an increase of 14%.

In the futures market, maize prices were down from 3 – 7% over last week for Aug – Nov deliveries, but remained over Rs.10,000 per MT levels. Prices in Davangere SPOT market moved up by 6.8%, breached Rs.11000 per MT mark. Prices in Karimnagar and Nizamabad though were down by 1%. One of the reasons being attributed to a sudden price decrease is improvement in the monsoon coverage and some areas receiving wide-spread rains, which is likely to reduce the loss of yield. Even if farmers increase the speed of sowing in areas, which are receiving rains, the productivity will be affected.

Pearl Millet (Bajra) prices added 0.4% to its tally, reaching Rs.7900 per Mt at the market yard. The prices are 16% above last year values in the last week of July 2007. As the average prices are lower than maize by 14% thus generating interest to use Pearl Millet in rations and heavy buying is being done for delivering to South India, where average delivery prices are Rs.10000 – 10,500 per MT. Average Pearl Millet price for July 2008 was Rs.7440 per MT, against Rs.6580 per MT in July 2008, an increase of 13%.

Sorghum (Jowar) prices moved up by 5.6% to level at Rs.11,380 per MT at the market yard. Prices are about 15.4% higher than last year and 21% higher than maize. Average price for July 2008 at t he market yard was Rs.10,825 per MT, against Rs.9382 per MT in July 2007, an increase of 15.3%.

Barley prices were lower by 6.3% at the market yard this week, to level at Rs.10,290 per MT, but were higher than last year by 26.5%. Average prices for July 2008 were Rs.10,767 per MT almost 49.5% up against Rs.7200 per MT in July 2007.

Corn prices on CBOT slipped further by $4 -5, per Mt to close at 4222.42 - $230 per MT. One the reasons attributed to lower prices is the good weather in the corn belt and in addition reports than Argentina may be reducing the export tax.

Poultry Processing and waste management

At a recent meeting held under the agies of Municipal Corporation of Delhi regarding increased number of bird hits at Delhi’s Indira Gandhi International Airport, the poultry and animal waste generated and dumped around the city of Delhi from the slaughtering at the poultry market and elsewhere in the city has been held culprit. In addition the Hindon airbase, which is a stone throw from the Poultry Market on NH 24, is also facing problems of bird hit, due to slaughter and dumping of poultry waste at the dumpsite.

The Municipal Corporation of Delhi (MCD) enacted a law in Nov 2004, wherein slaughter of birds within the city of Delhi was banned, but the law was not enacted. It is high time that GOI / MCD takes action on this.

A proper poultry processing plant set up in Delhi will not only provide safe poultry meat to the citizens and tourists in the area, but will also help in managing poultry waste, that will be generated and will be rendered (converted into a protein meal at high temperature and pressure) within the premises, before being trucked out.

Food safety will be a major concern during common wealth games in 2010 and Govt. of Delhi will be need to be ready to provide not only safe food to the athletes but also safe environment to one and all.

For the Beijing Olympics, China has already gone ahead and banned live bird sales in some areas. Also extensive monitoring of poultry production from breeders to slaughters to delivery trucks and the feeding regimen have been taken up. This is to ensure safe food not only to the athletes but also for the general public. Once the project is implemented,

DDGS can lower cost of production

Report from two universities in US (Auburn and Purdue) suggest that 10% use of DDGS in broiler rations with appropriate enzymes can increase efficiency of production. It can lower the feed cost by about $9 per MT (US standards). A trial conducted reported 8% better live weight gain in 56 days and also improvement in Feed Conversion Ratio (FCR) by 4 points.

DDGS, with 10% oil and 27% protein is the only combination source, which is being used effectively in many countries of the world to manage production costs. It can also be used in dairy feeds to provide concentrated form of energy and protein to high yielders and in case of fish feed as well.

New plants are coming online in USA and the supply situation is likely to ease. The price of DDGS delivered to South East Asia (closest Bankok) is about $325.

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