Maize prices slump in India, move up in US
Maize prices have slumped in the market yard across the country to Rs.7700 per MT, a loss of 2.8% against last week. The prices though still remain higher than last year by 11% at the market yard level for loose material. Reports available indicate that maize is being delivered to destination in Tamil Nadu, Karnataka and also Andhra Pradesh at Rs.8400 – 8500 levels.
In the futures as well as the spot markets the prices have crashed and currently are below the Minimum Support Price (MSP) of Rs.8400 per MT. For Jan 2009 delivery, the prices were down by 3.4% over last week to Rs.7815 per MT< while for Feb and Mar delivery the prices tumbled 4.6% to level at Rs.7820 and Rs.7840 per MT. For April delivery the prices were down by 5.4% to Rs.7900 per MT. On the Spot market, maize at Nizamabad lost 2.73% to level at Rs.8279 per MT. In karimnagar and Davangere the prices were lower than last week by 2.9% and leveled at Rs.Rs.8082 and 8275 per MT.
These low prices are a boon to the poultry sector as the cost of production will go down and as the prices for broilers remain higher due o good demand in North, South and West, it will a good time for the poultry farmers. Even though North East of the country is affected due to bird flu and demand of chicken low in urban and rural belts in the region, other regions of the country are not affected as consumers are aware that bird flu birds will not reach them in their regions and there is no panic.
Pearl Millet (Bajra) prices have gone up in the market yard by 2.2% to reach Rs.7760 per MT at the market yard. Against maize the prices are higher by 1.1%, which has not been case for a long time. The prices are also higher than last year by 14.2% at this time of the year.
Sorghum (Jowar) prices moved close to Rs.8200 per MT, losing 8.8% over the week. The prices are only 6.4% higher than maize and remain lower than last year prices by about 25%.
Barley prices have also slumped by 8.6% at the market yard and are lower than last year by 23.6%. In the spot market at Jaipur the price was down by 0.4% to Rs.9162 per MT (tax paid).
Corn on CBOT moved up by 8.3% for Mar and May delivery to close at $162.27 and $166.30 per MT
Poultry industry to shrink in US
In 2007, US poultry produced 8.9 billion broilers and at the farm level the broilers were worth $21.5 billion and the retail value was $43 billion as per USDA report. The total poultry meat production was 16.374 billion kg, with a per capita consumption of 38.73 kg per person per annum.
In 2008, especially in the last quarter, the poultry industry has cut back production and eggs set have come down by 8% in October and 3% in November against last year’s numbers for the same month. Overall production in November is expected to be lower by 5%, based on slaughter numbers and the trend is likely to continue well into 2009 as per industry watchers. In 2008, the per capita consumption as expected was to be 38.46 kg per person per annum and as new data emerges, this will be down further.
Reports indicate that the US poultry industry is likely to cut production by 5-6%, based on eggs set. The major reason for this production cuts is the lower demand of chicken.
In Brazil too, Perdigao and Sadia, the two largest meat processors, have plans to cut poultry meat output to adjust inventories. This is being down as the exports have slowed and prices will need to be stabilized.
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
Saturday, December 27, 2008
Monday, December 22, 2008
Sorghum and DDGS Prices in US - update
Sorghum and DDGS Prices in US
The US Gulf Fob Prices of US No.2 corn for Jan - May 2009 delivery is ranging from $170-172 per MT. The prices of Sorghum at the same time is $159 - 167 per Mt for the same period. For January delivery the prices are lower by 6.4%. By the month of may the difference is only 3%.
DDGS prices have also slumped and currently indicative prices are $180-186 per MT delivered to SEA region, particularly to Malaysia and Vietnam.
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
The US Gulf Fob Prices of US No.2 corn for Jan - May 2009 delivery is ranging from $170-172 per MT. The prices of Sorghum at the same time is $159 - 167 per Mt for the same period. For January delivery the prices are lower by 6.4%. By the month of may the difference is only 3%.
DDGS prices have also slumped and currently indicative prices are $180-186 per MT delivered to SEA region, particularly to Malaysia and Vietnam.
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
Sunday, December 21, 2008
Mixed bag of prices in India
Mixed bag of prices in India
Maize prices have remained stable at Rs.7900 per Mt this week, bur have been higher than the last year prices by about 12.4%. The demand of maize is slow as the second episode of Bird Flu has been report in West Bengal in Malda District. This is likely to affect the demand of maize in the North Eastern Region. In the futures as well as the spot markets though the price of maize has slumped. In The futures market the prices slumped by 1.4% - 3.3% for Jan – Mar delivery. In the spot markets as well in Nizamabad, Karimnagar and davangere, the prices were down by 0.75%, 1.54% and 2.16% respectively over last week..
Pearl Millet (bajra) prices this week moved up over last week by about 3% and have been higher than last year by 12.6%. Against maize the pries are lower by 4%.
Sorghum (Jowar) prices have also increased by 3.4% this week at the market yard. Prices, however are lower than last year by 8.3%. Against maize the prices are higher by 12%.
Barley prices have moved at the market yard level by 7.1%, but the prices are lower than last year by 5.6%. In the spot market at Jaipur theprices slumped by 6% over last week.
Corn on CBOT closed higher this week against last week by almost 2% by March delivery ($149.83 per MT) and also up for May delivery by 1.38% ($153.57 per MT). Sever weather in US now would affect the deliveries, but the indicative values FOB US Gulf would be 4172/175 per MT.
While in India, the Sorghum prices have been ruling higher than the corn prices, in US though the price of Sorghum on US Gulf (FOB) is indicated lower than corn at $157/165 per MT as on last week, a discount of $4-10 per MT for January - April delivery as of last week. It may be noted that US produces zero tannin Sorghum, which is used at the same value as corn in poultry rations, Countries like Mexico and last year European farmers used Sorgjum in feeds without any problems.
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
Maize prices have remained stable at Rs.7900 per Mt this week, bur have been higher than the last year prices by about 12.4%. The demand of maize is slow as the second episode of Bird Flu has been report in West Bengal in Malda District. This is likely to affect the demand of maize in the North Eastern Region. In the futures as well as the spot markets though the price of maize has slumped. In The futures market the prices slumped by 1.4% - 3.3% for Jan – Mar delivery. In the spot markets as well in Nizamabad, Karimnagar and davangere, the prices were down by 0.75%, 1.54% and 2.16% respectively over last week..
Pearl Millet (bajra) prices this week moved up over last week by about 3% and have been higher than last year by 12.6%. Against maize the pries are lower by 4%.
Sorghum (Jowar) prices have also increased by 3.4% this week at the market yard. Prices, however are lower than last year by 8.3%. Against maize the prices are higher by 12%.
Barley prices have moved at the market yard level by 7.1%, but the prices are lower than last year by 5.6%. In the spot market at Jaipur theprices slumped by 6% over last week.
Corn on CBOT closed higher this week against last week by almost 2% by March delivery ($149.83 per MT) and also up for May delivery by 1.38% ($153.57 per MT). Sever weather in US now would affect the deliveries, but the indicative values FOB US Gulf would be 4172/175 per MT.
While in India, the Sorghum prices have been ruling higher than the corn prices, in US though the price of Sorghum on US Gulf (FOB) is indicated lower than corn at $157/165 per MT as on last week, a discount of $4-10 per MT for January - April delivery as of last week. It may be noted that US produces zero tannin Sorghum, which is used at the same value as corn in poultry rations, Countries like Mexico and last year European farmers used Sorgjum in feeds without any problems.
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
Saturday, December 13, 2008
Commodities plunge further in India; Consistent food safety standards a must for trade
Commodities plunge further in India
Maize prices remained stable at the market yard this week at Rs.7900 per MT. prices are about 16% higher than last year’s prices. There are reports that GOI is considering a second package for the agriculture sector and provide a 10% incentive for export of maize and SBM from India. The incentive will be on FOB prices and the export value of maize, would still be higher for Indian corn even after a 10% incentive, specially on bulk corn exports from India.
In the futures market as well maize prices slumped this week by about 1% for Dec delivery to Rs.8040 per MT. Spot prices in Nizamabad, Davangere and Karimnagar were similar to last week to Rs.8500-8600 per MT levels.
Pearl Millet (Bajra) prices slumped by 4.6% this week to reach Rs.7375 per MT. Against maize, the prices are lower by 7.4% and are higher than last year by 12.5%.
Sorghum (Jowar) prices slumped by 5.3% to Rs.8700 per MT at the market yard. The prices were just about 1% higher than last week and against maize, the prices are 14% higher.
Barley prices plunged 7.8% this week to Rs.8500 per MT. These are the lowest prices since Sept 2007. The prices are lower than last year prices by 23%. In the futures market, barley prices plunged by 3% to Rs.9700 per MT. Even in the spot markets, prices were down by 3.8% to Rs.9790 per MT at Jaipur.
Corn on CBOT bounced back and gained about 22% closing at $141.48 per Mt for Dec delivery and adding 21% to the rally for mar delivery, closing at 146.99 per MT for Mar delivery. For may delivery, corn on CBOT closed at %151.41 per MT. Fob prices (US Gulf) were indicated at $166/167 per MT, while for PNW were at $176/178 per MT. The indicative frieght rates for US gulf - japan were at $23 per MT while PNW-Japan were at a low of $13 per MT.
USDA also released its monthly report, in which the corn production estimates are unchanged, but the demand for corn from ethanol sector has been reduced by 7.62 MMT. In addition, the export projection have been decreased by 2.54 MMT.
The Chinese corn crop estimates have been increased from 156 MMT to 160 MMT. There are unconfirmed reports that China may also give an export incentive of 13%, but even with that the reports say that the Chinese corn prices will be higher than the US and South American corn in the region.
Consistent food safety standards a must for trade
Countries are being urged to adopt internationally consistent food safety standards and it will help in better trade and also assist in building the trust with domestic consumers. The case in point is China, which was recently under limelight due to melamine adulteration in milk and milk products and its possible in the food chain including meat and meat products.
Recently EU opened up its borders for Chinese meat and poultry products after 4 years and this will also help China to move the case in Russia and Middle East.
The move has allowed a number of companies who follow the international food safety regulation to ship heat-treated products to the EU. This move has not only boosted the confidence of exports but has helped the local market as well. The quality has improved as per a report from China.
In an interesting turn of events, the Kerala High Court this week ordered the closure of illegal slaughter houses and meat shops in the State. The local self-governing bodies have been directed to ensure there was no illegal slaughter houses are functioning in the State.
In 2006, the The Supreme Court had also issued notices to the federal government and six states directing them to bring in a uniform legislation to set up slaughter houses for all animals in the country to provide hygienic meat to the population and also provide safeguard against damages to the environment.
The Municipal Corporation of Delhi in 2004 had announced a law that bans the slaughter of poultry in the city and its exhibition at shops. It also gives direction on the shops sized, and which kind of meat can be sold. The law is still to be implemented as the public slaughter facility in Delhi or large/small animals and also poultry is still under review. Though the large animal slaughter facility has been constructed, but is not operational.
Maize prices remained stable at the market yard this week at Rs.7900 per MT. prices are about 16% higher than last year’s prices. There are reports that GOI is considering a second package for the agriculture sector and provide a 10% incentive for export of maize and SBM from India. The incentive will be on FOB prices and the export value of maize, would still be higher for Indian corn even after a 10% incentive, specially on bulk corn exports from India.
In the futures market as well maize prices slumped this week by about 1% for Dec delivery to Rs.8040 per MT. Spot prices in Nizamabad, Davangere and Karimnagar were similar to last week to Rs.8500-8600 per MT levels.
Pearl Millet (Bajra) prices slumped by 4.6% this week to reach Rs.7375 per MT. Against maize, the prices are lower by 7.4% and are higher than last year by 12.5%.
Sorghum (Jowar) prices slumped by 5.3% to Rs.8700 per MT at the market yard. The prices were just about 1% higher than last week and against maize, the prices are 14% higher.
Barley prices plunged 7.8% this week to Rs.8500 per MT. These are the lowest prices since Sept 2007. The prices are lower than last year prices by 23%. In the futures market, barley prices plunged by 3% to Rs.9700 per MT. Even in the spot markets, prices were down by 3.8% to Rs.9790 per MT at Jaipur.
Corn on CBOT bounced back and gained about 22% closing at $141.48 per Mt for Dec delivery and adding 21% to the rally for mar delivery, closing at 146.99 per MT for Mar delivery. For may delivery, corn on CBOT closed at %151.41 per MT. Fob prices (US Gulf) were indicated at $166/167 per MT, while for PNW were at $176/178 per MT. The indicative frieght rates for US gulf - japan were at $23 per MT while PNW-Japan were at a low of $13 per MT.
USDA also released its monthly report, in which the corn production estimates are unchanged, but the demand for corn from ethanol sector has been reduced by 7.62 MMT. In addition, the export projection have been decreased by 2.54 MMT.
The Chinese corn crop estimates have been increased from 156 MMT to 160 MMT. There are unconfirmed reports that China may also give an export incentive of 13%, but even with that the reports say that the Chinese corn prices will be higher than the US and South American corn in the region.
Consistent food safety standards a must for trade
Countries are being urged to adopt internationally consistent food safety standards and it will help in better trade and also assist in building the trust with domestic consumers. The case in point is China, which was recently under limelight due to melamine adulteration in milk and milk products and its possible in the food chain including meat and meat products.
Recently EU opened up its borders for Chinese meat and poultry products after 4 years and this will also help China to move the case in Russia and Middle East.
The move has allowed a number of companies who follow the international food safety regulation to ship heat-treated products to the EU. This move has not only boosted the confidence of exports but has helped the local market as well. The quality has improved as per a report from China.
In an interesting turn of events, the Kerala High Court this week ordered the closure of illegal slaughter houses and meat shops in the State. The local self-governing bodies have been directed to ensure there was no illegal slaughter houses are functioning in the State.
In 2006, the The Supreme Court had also issued notices to the federal government and six states directing them to bring in a uniform legislation to set up slaughter houses for all animals in the country to provide hygienic meat to the population and also provide safeguard against damages to the environment.
The Municipal Corporation of Delhi in 2004 had announced a law that bans the slaughter of poultry in the city and its exhibition at shops. It also gives direction on the shops sized, and which kind of meat can be sold. The law is still to be implemented as the public slaughter facility in Delhi or large/small animals and also poultry is still under review. Though the large animal slaughter facility has been constructed, but is not operational.
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
Saturday, December 06, 2008
Maize down, while other coarse cereal prices move up; Bird flu and compartmentalization
Maize down, while other coarse cereal prices move up
Maize prices were Stable this week in India and were close to Rs.7900 per MT at the Market yard level. Prices are about 6% below the Minimum Support prices announced by GOI. Against last year, the prices are higher by about 14% at the market yard level.
In the future market, the prices were down by 0.6 – 1.6% for Dec – Feb delivery against last week. For Dec 2008 and Jan 2009 delivery pries were below MSP. Even in the SPOT markets of Davangere and Nizamabad and prices were down by 0.3 and 1.3% respectively against last week. Only in Karimnagar the prices were up by about 1.5% to Rs.8633 per MT.
Pearl Millet (Bajra) prices were up this week by 6.3% against last week, reaching Rs7750 per MT at the market yard. Against last year, the prices were higher by 13%. Against maize, the prices are lower by 2% only.
Sorghum (Jowar) prices also went up against last week by 3.5% to Rs.9180 per MT. Pries are lower than last year by 10.5% and against maize the prices are higher by 14%.
Barley prices have remained stable on an average at Rs.9200 -9300 per MT range. And are lower than last year values by about 12%. In the future market as well the prices were down by 3% for Dec delivery to Rs.9990 and for April lower by 4% to Rs.10,442 per MT.
On CBOT, the prices were under $3.00 per Bushel (lowest) and lost 16% against last week’s Dec and March close. The delivery for the two months were indicated at $115.5 and 121.72 per MT. respectively. Indicative FOB values (US Gulf) would be close by $135/142 per MT. CNF values to SEA region would be close to $180/185 per MT.
There are many factors being attributed to the drop in corn prices in US, including higher dollar, lower crude, November employment report, which shows the highest unemployment numbers since 1974. This shows that the economic slowdown is there and demand erosion continues. In addition Government of Argentina has lowered export taxes on corn from 25% to 20%, making Argentine corn much cheaper. There are reports that Argentine and Brazilian corn is available in SEA region at $165/170 per MT.
Bird flu and compartmentalization
India is in the grip of BIRD FLU once again. This time in Assam in the KAMRUP district, which has Megahlaya in the South and beyond that is Bangladesh. The recent bird flu outbreak has hit exports, which were already down. It has been two years now that Indian’s exports of eggs and poultry meat has been hit badly because of bird flu. The last case of bird flu was reported in West Bengal in Feb 2008, it was only in mid November 2008 that India was declared bird flu free.
It is not only the exports that are hit, but demand of eggs and poultry meat in the region also takes a beating. It has been recognized that eradicating BIRD FLU from the geographical area is almost impossible and it is important to manage the same and plan systems which, will help the industry move forward. The need is to avoid losses and continue the growth of the industry.
The World Organization for Animal Health (OIE) included the use of compartments in its guidelines on avian influenza control in 2005, where it is the stressed that compartmentalization as a strategy can be adopted by countries but attention must be given to the production level and industry characteristics features. It will also be important then that the countries have trade agreements which define compartmentalization, so as trade is not affected.
To understand, compartmentalization means creating/identifying small groups of farms or processing units based on the scale of production and other shared characteristics in order that approaches to controlling disease are geared to these identified compartments rather than the entire poultry industry
Farms with low input low output management such as households rearing backyard native chickens could be classed in a completely separate compartment to that of a high bio-secure intensive operation raising thousands of broilers for international markets.
The grouping thus is based on the scale of production and inputs, and particularly on a common bio-security system within a compartment, and degree of traceability of animals and products with in the chain. There is a possibility that the geographic space occupied by a compartment is not continuous, provided that bio-security is maintained and thus all of the operations within one vertically integrated poultry company could be considered as a compartment, even if they are physically separated.
Compartmentalization as per OIE can only be effective when seen as part of a a national disease control strategy, requiring surveillance and monitoring activities, stamping out of outbreaks and on-farm bio-security, and protection for the compartment from incursion of disease agents.
In such a situation, when AI outbreaks are reported in backward systems, the large, bio-secure units continue production of chicks, meat, & eggs, and exports that are subject to the trade agreement.
In the new system of compartmentalization, certain changes in management would also be seen in different compartments.
An earlier report of Feb 02, 2008 can be seen on zoning
http://usgcindiamarketreport.blogspot.com/2008/02/commodity-prices-move-up-zoning-of.html
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
Maize prices were Stable this week in India and were close to Rs.7900 per MT at the Market yard level. Prices are about 6% below the Minimum Support prices announced by GOI. Against last year, the prices are higher by about 14% at the market yard level.
In the future market, the prices were down by 0.6 – 1.6% for Dec – Feb delivery against last week. For Dec 2008 and Jan 2009 delivery pries were below MSP. Even in the SPOT markets of Davangere and Nizamabad and prices were down by 0.3 and 1.3% respectively against last week. Only in Karimnagar the prices were up by about 1.5% to Rs.8633 per MT.
Pearl Millet (Bajra) prices were up this week by 6.3% against last week, reaching Rs7750 per MT at the market yard. Against last year, the prices were higher by 13%. Against maize, the prices are lower by 2% only.
Sorghum (Jowar) prices also went up against last week by 3.5% to Rs.9180 per MT. Pries are lower than last year by 10.5% and against maize the prices are higher by 14%.
Barley prices have remained stable on an average at Rs.9200 -9300 per MT range. And are lower than last year values by about 12%. In the future market as well the prices were down by 3% for Dec delivery to Rs.9990 and for April lower by 4% to Rs.10,442 per MT.
On CBOT, the prices were under $3.00 per Bushel (lowest) and lost 16% against last week’s Dec and March close. The delivery for the two months were indicated at $115.5 and 121.72 per MT. respectively. Indicative FOB values (US Gulf) would be close by $135/142 per MT. CNF values to SEA region would be close to $180/185 per MT.
There are many factors being attributed to the drop in corn prices in US, including higher dollar, lower crude, November employment report, which shows the highest unemployment numbers since 1974. This shows that the economic slowdown is there and demand erosion continues. In addition Government of Argentina has lowered export taxes on corn from 25% to 20%, making Argentine corn much cheaper. There are reports that Argentine and Brazilian corn is available in SEA region at $165/170 per MT.
Bird flu and compartmentalization
India is in the grip of BIRD FLU once again. This time in Assam in the KAMRUP district, which has Megahlaya in the South and beyond that is Bangladesh. The recent bird flu outbreak has hit exports, which were already down. It has been two years now that Indian’s exports of eggs and poultry meat has been hit badly because of bird flu. The last case of bird flu was reported in West Bengal in Feb 2008, it was only in mid November 2008 that India was declared bird flu free.
It is not only the exports that are hit, but demand of eggs and poultry meat in the region also takes a beating. It has been recognized that eradicating BIRD FLU from the geographical area is almost impossible and it is important to manage the same and plan systems which, will help the industry move forward. The need is to avoid losses and continue the growth of the industry.
The World Organization for Animal Health (OIE) included the use of compartments in its guidelines on avian influenza control in 2005, where it is the stressed that compartmentalization as a strategy can be adopted by countries but attention must be given to the production level and industry characteristics features. It will also be important then that the countries have trade agreements which define compartmentalization, so as trade is not affected.
To understand, compartmentalization means creating/identifying small groups of farms or processing units based on the scale of production and other shared characteristics in order that approaches to controlling disease are geared to these identified compartments rather than the entire poultry industry
Farms with low input low output management such as households rearing backyard native chickens could be classed in a completely separate compartment to that of a high bio-secure intensive operation raising thousands of broilers for international markets.
The grouping thus is based on the scale of production and inputs, and particularly on a common bio-security system within a compartment, and degree of traceability of animals and products with in the chain. There is a possibility that the geographic space occupied by a compartment is not continuous, provided that bio-security is maintained and thus all of the operations within one vertically integrated poultry company could be considered as a compartment, even if they are physically separated.
Compartmentalization as per OIE can only be effective when seen as part of a a national disease control strategy, requiring surveillance and monitoring activities, stamping out of outbreaks and on-farm bio-security, and protection for the compartment from incursion of disease agents.
In such a situation, when AI outbreaks are reported in backward systems, the large, bio-secure units continue production of chicks, meat, & eggs, and exports that are subject to the trade agreement.
In the new system of compartmentalization, certain changes in management would also be seen in different compartments.
An earlier report of Feb 02, 2008 can be seen on zoning
http://usgcindiamarketreport.blogspot.com/2008/02/commodity-prices-move-up-zoning-of.html
Amit Sachdev
India Representative
U S Grains Council
bluecross303@gmail.com
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