SEASON"S GREETINGS AND A HAPPY NEW YEAR.
May the new year bring prosperity, peace and happiness
Maize prices up in open market, slip in future markets
New draft rules for registration and licensing for food businesses
3. Milk and Milk Products Order, 1992
4. Vegetable Oil Products (Control) Order, 1947
5. Edible Oils Packaging (regulation ) Orders, 1998
6. The solvent Extracted Oil, De oiled Meal and Edible flour (Control) Order, 1967
7. Meat Food Products Orders, 1973
Prices stable for maize, but higher that last year, coarse cereals prices made a dent; DDGS a major livestock feed ingredient
Maize prices moved up by 2.8% on the average at the market yard for pan India to Rs.9580 per MT. The prices are 15% higher than last year at this point. Prices remained stable in Maharashra and Karnataka from where stocks are moving to other parts of the country. Prices in Andhra were slightly lower by 0.6% to Rs.8550 per MT, while in all other states average prices moved up. Gujarat up by 2% to Rs.10140 per MT; Rajasthan up by 1.3% to 9950 per MT; Tamil nadu up by 0.76% to Rs. 8650 per MT and Uttar Pradesh up by 5.5% to Rs.10233 per MT. While the overall availability may be good, an average sample of maize contains more of small grains as per market reports.
Demand from starch units is good and with Government of Maharashtra clearing maize, Sorghum and pearl millet), the demand is likely to rise further within one year one would be able to see use of 0.5 – 0.7 MMT of grains used in the sector. Already plants in Andhra Pradesh and Karnataka are using maize to produce alcohol. While NGO’s have opposed the move, as coarse cereals are staple for the resource poor farmers and the diversion will increase the price, which many experts believe is good for the farmers.
On NCDEX the prices are lower than last week by 1.5 - 1.7%, probably as more stocks are in the market and Rabi sowing is a little better. Jan contract was Rs.9930 per Mt, down 1.68%; Feb down 1.54% to Rs.10190; Mar down 1.51% to Rs.10410 per Mt. Only April contract was up marginally by 0.14% to Rs.10710 per MT. In the spot markets as well, prices were down slightly, Nizamabad down 1.1% to Rs.9472 per MT; Karimnagar down 1.47% to Rs.9222 per Mt. Prices in Davangere were up by 0.12% to Rs.9362 per MT.
Pearl Millet prices remained stable at RS.9900 per MT and were higher than last year by 23.3%. Against maize, prices are higher by 3.2%.
Sorghum prices also have moved up by 3.4% to Rs.13,200 per MT and are higher than last year by 32%. Prices are higher than maize by 27.4%.
Barley prices at the market yard moved lower by 6.2% to Rs.8420 and were also down against last year by 7.5%. In the futures as well as the spot market, prices moved lower. April down 0.11% to 10208 per MT; May down 0.61% to 10398 per Mt. Jaipur down 0.43% to Rs.9409 per MT.
As on Dec 11, 2009, while overall wheat crop was sown in more area in 2009 (21.728 mill hac) than in 2008 (21.602 mill hac), repots were that the sowing was up in Madhya Pradesh and down in other key states of Punjab, Haryana, Uttar Pradesh, Maharashtra and Gujarat. Barley area is reported to be up to 0.623 mill hac in 2009 from 0.58 mill hac, an increase of 7.4%. Area under sorghum is reported to be down to 4.347 mill hac in 2009, against 4.791 mill hac in 2008, loss of 9.2%. Maize/Corn area is up slightly (3.4%) to 0.73 mill hac in 2009 against 0.706 mill hac in 2008. Area under all oilseeds in projected to be down by 7.19% to 7.7 mill hac in 2009. Area under pulses/lentils is expected to be up 2.3% to 11.19 mill hac in 2009 against 10.93 mill hac in 2008.
For the week ended Dec 5, 2009, the food inflation has hit a 11 year high of 19.95%, mostly due to lower production of food crops and higher demand. GOI has assured that in case there is a requirement, imports would be stepped up for all food products.
On CBOT, corn prices settled lower for the near contract May 2010, down 1.68% to $156.82 per Mt. For May 10 as well prices were down by 1.68% to $160.77 per Mt. July contract closed at $164.32 per MT. Prices are down as the market is entering the holiday mode and next 10 days would be easy on the market. FOB gulf prices are indicated at $180 per MT for Feb to April and FOB PNW are indicated at $199-206 per MT for Jan – April 2010. Sorghum was indicated at $184-186 per MT for Jan – Mar 2010.
DDGS is finding more users domestically and also in other parts of the world. Livestock users have excepted DDGS as a product of choice in livestock, poultry, fish and swine rations all over the world. For the period Jan – Oct 2009, US has exported 4.56 MMT of DDGS, 17.34% higher than 2008 (same period). The countries parts from Americas which, are bigger buyers include China 336 TMT; Thailand 261 TMT; Vietnam 200 TMT; Malaysia 30 TMT. Countries like Turkey and Egypt have been consistently importing the product for use in all livestock rations. The current price FOB Gulf is indicated at $171 for Jan/Feb and $163 for Mar. Current CNF values for SEA region are close to $235-246 depending on the destination. The other protein meal (corn gluten) is trading at $670 per MT (FOB US Gulf).
Whole sale markets receive grain, prices move lower, inflation is up
Maize prices have moved up in the market yard by 3.7% to Rs.9300 ($200) per MT range. Prices are higher than last year by 15%. Prices in Andhra Pradesh moved up by 0.73% to Rs.8600 ($185) per MT while in Gujarat, Tamil Nadu and Uttar Pradesh the prices moved lower by 1.13%, 0.63% and 8.3% to Rs.9950 ($204), Rs,8600 ($185) and Rs.9700 ($209) per MT respectively. Prices remained stable in Karnataka and Maharashtra.
On the NCDEX futures market, prices moved lower. Dec ended 0.8% lower than last week at Rs.9830 ($211) per MT; Jan down 1.17% Rs.10100 ($217) ; Feb down 1.66% to Rs.10350 ($223) ; Mar down 3% to Rs.10570 ($227). Spot markets to ended lower than last week with Karimnagar losing the most 2.48% to Rs.9360 ($201). Nizamabad was down 0.68% to Rs.9583 ($206) and Davangere lost 0.2% to Rs.9350 (201) per MT. On the MCX futures, Dec contract was stable at Rs.9870 ($212) per MT, while in the Spot Nizamabad, price was Rs.9555 ($205) per MT, down 0.93% and much closer to NCDEX Nizamabad spot price.
It is interesting to note that the Dec futures have been inching up for the last 3 weeks now and just about 2.5% higher than the spot prices at Nizamabad.
Pearl Millet (Bajra) prices were down by 4.4% to Rs.9900 ($213) per MT, but are higher than last year by 25.5%. Against maize, the prices are higher by 5.9% at the market yard.
Sorghum (Jowar) prices moved up by 15% at the market yard to reach Rs.12770 ($275) per MT, about 32% higher than last year and 27.6% higher than maize.
Barley prices also moved up by 8% at the market yard to Rs.9050 ($195) per MT. Prices are higher than last year by 5.8%. In the futures market, Dec contract was down by 3.28% to Rs.9608 ($207). Apr and May contract also lost 3.28% and 0.45% to close at Rs.10300 ($221) and Rs.10462 ($225) per MT. Jaipur spot price for barley was Rs.9450 ($203) per Mt, down 0.2% from last week.
On CBOT corn prices moved up by about +4% as the harvest is delayed further due to blizzard conditions in the corn belt at least 38 MMT (1.5 billion bushels) is still in the field. Dec contract up 4.18% to $153.22 per MT; Mar up 4.12% to $159.20 per MT and May up 4.11% to $163.53 per MT. FOB Gulf price is indicated at $179-182 per Mt for Jan to Mar, while FOB PNW value is indicated at $194-196 per MT. Sorghum is indicated higher than corn at $186/189 per Mt FOB Gulf.
DDGS prices FOB US Gulf for Dec were indicated close to $182 per MT, while for Jan and Feb were indicated at $177 per MT and $166 per MT respectively. Prices CNF SEA region (Vietman) were indicated at $240 per MT.
The freight rates are little lower as the markets get ready for a holiday season. Gulf – Japan was indicated at $68 (down $1) per MT and PNW japan was indicated at $39 (down $2) per MT.
Food prices in India are moving up every week and the food inflation for the week Nov 28 touched 19.05%, 1.55% higher than the previous week (Nov 21). Analysts believe that while the food inflation is based on WPI, at the consumer level (retail) the prices are much higher and that the food inflation will be more than 25%.
There are many areas in Punjab dairy belt where maize has been grown for last two years. This though is not for grain production, but for corn silage for feeding to dairy animals. Using the seed for grain production (early maturity) makes a lower grade silage with high dry matter and lower protein. As the feed prices move up, farmers have started to look for alternatives, which is taxing to the animals and reduces production. Farmers at different locations, have put the feed cost per kg of milk at Rs.9.6 - 11.6 and the cost of production at Rs.11 – 13.5 per liter depending on production of milk.
Amit Sachdev, India Representative, U S Grains Council, Email: usgcindia@gmail.com
Lower prices as on date, future prices are higher
Maize prices on an average dropped by 3.4% to reach Rs.9000 ($194.6) per MT at the market yard. The prices are higher than last year by 12.2%. While prices were reported to be down in Andhra Pradesh by 0.4% to Rs.8540 ($184.7) per MT; Tamil nadu by 2.6% to Rs.8633 ($186.6) per MT. Prices are stable in Karnataka at Rs.8400 ($181.6) and Rajasthan. Prices are reported to be up in Gujarat by 1.2% to Rs.10050 ($217) per MT; Maharashtra by 2.7% to Rs.8650 ($187) per MT and Uttar Pradesh by 14.6% to Rs.10583 ($228.8) per MT. The deliveries in production centers have increased specially in Kartanaka and Maharasthtra
In north India, delivered prices are reported at Rs.11200 ($242) per MT. Corn is available from Karnataka (loaded) at Rs.8650 ($187) per MT.
On NCDEX, prices rallied higher than last week for two contracts Dec and Mar 2010 by 0.5% and 0.8% to Rs.9910 ($214) per MT and Rs.10900 ($235) per MT. respectively. Jan and Feb contracts were stable at Rs.10220 ($221) per MT and Rs.10525 ($228) per MT respectively. In the spot markets prices have moved up by the end of the week and were up by approximately 2 – 2.5% across the board. Nizamabad up 2.4% to RS.9649 ($208) per MT; Karimnagar up 2.12% to Rs.9599 ($207) per MT, and Davangere up 2.29% to Rs.9370 ($203) per MT. On MCX as well, prices moved higher for Dec contract by 0.2% to Rs.9870 ($213) per MT. In the spot exchange (Nizamabad) prices moved up by 4.2% to Rs.9645 ($208) per MT, similar to NCDEX spot price at Nizamabad.
Pearl Millet (Bajra) prices have moved up by 2.5% at the market yard to 10,350 ($223.7) per MT and prices are also higher than last year by 25.3%, Against maize prices are higher by 13.2%. Bajra is a staple for people in Rajasthan, parts of Uttar Pradesh and some parts of Haryana. With production down by 34% and no more crop in Rabi, the prices are likely to remain higher for the remaining year.
Sorghum (Jowar) prices corrected and are down by 19.3% to Rs.11110 ($240) per MT. Prices are higher than last year by 17.3% and also higher than maize by 19.1%. Sorghum is a staple for people in Maharashtra, parts of Kartanaka, Andhra Pradesh and with the production down by about 18%. With production targeted at 3.90 MMT in Rabi, the overall deficit of 11% will remain. With the demand of white sorghum as food and as health snack/food, increase in prices cannot be ruled out. As t he harvest was delayed, the stock arrivals have increased now, thus the prices are under pressure.
Barley prices moved lower by 20% to Rs.8400 ($181) per MT. The price is lower than last year by 10.3%. In the futures market, prices remained stable at Rs.9900 ($214) per MT for Dec contract and moved up for April contract by 1.42% to Rs.10650 ($230) per MT and lower for May by 0.75% to Rs.10510 ($227) per MT. In the spot market of Jaipur, prices are higher by 0.5% to Rs..9469 ($205) per MT.
Multi-Commodity Exchange of India (MCX) has launched the exchange of futures for physicals (EFP) transaction facility in 12 commodities. Only Chana (Chick Pea) and Wheat are offered in the facility from the agricultural commodities and if maize can be offered, it will certainly help the end users in India and lock the prices. An EFP transaction is an exchange of futures contracts for a physical commodity transaction between two market participants.
GOI has acknowledged a deficit in Pulses (3.6 MMT), sugar (7 MMT) and the food inflation for the week Nov 21, 2009 is up to 17.5% against last year. If one looks at the grains package, of all the food grains in the market, maize/corn is the cheapest at Rs.9200 – 11200 ($199 – 242) per MT depending on the station. While all other grains Wheat, Rice are higher. Wheat at Rs.15000 ($324) per MT and rice at Rs.35000 ($756) per MT in the retail market. For the people in rural belt, if corn is available cheaper than other grains, it will be used as food.
With rice production down, availability of rice is an issue and layer sector is likely to look at other grains and with Pearl Millet and sorghum availability poor, pressure will be on corn.
International markets move lower and accept biotech
In the US, price of Corn on CBOT was down by about 6% for the three contracts, Dec down 6% to $147 per MT, Mat down 6% to $152.9 per MT and May down 5.89% to $157 per MT. The FOB rates for gulf and PNW were indicated at $179-182 per MT and $185-182 per MT for Dec to Feb period. Sorghum is indicated higher than corn at $191-189 for the same period for FOB Gulf.
Last week, EU cleared some GM traits and this would possibly allow flow of Soybean Meal, DDGS and Corn Gluten Meal containing these traits into EU. Turkey has banned imports of ingredients containing GM traits, and this had caused prices of energy and protein ingredients to increase. But now the government has allowed imports of all those ingredients, which have been contracted. Turkey was importing GM commodities and traits that were approved in country of origin for food and feed were allowed. This had helped the industry keep its prices in check.
China is one of the largest importers of DDGS in the region and it is being used consistently in dairy, poultry and swine feeds. It helps in reducing the pressure on corn and also to SBM to some extent. DDGS prices in US are indicated $171 (FOB US Gulf) and CNF prices to SEA region are indicated at $240-246 per MT for 36% profat product. The demand is steady in the domestic as well as international markets and most feed manufacturers in the would are now tuned to using DDGS as part of the ingredient mix, which helps in keeping the price of feed in check, without compromising on the quality of feed.
In the freight markwt, prices were somewhat lower for the Gulf – Japan and PNW – Japan benchmark by $3 per MT to $69 and $41 per MT respectively.
Amit Sachdev
India Representative
U S Grains Council
Email: usgcindia@gmail.com
Mixed calls for prices of coarse cereals
Maize prices moved up further at the market yard by 2.5% to Rs.9500 per MT. Prices are higher than last year at this point by 10.2%. The highest prices of yellow maize was quoted in Rajasthan at +10,000 per MT and for Red maize, it was in Gujarat at + Rs.10,000 per MT. Prices in Andhra Pradesh has been stable at Rs.8500 per Mt, while in Rajasthan and Tamil nadu prices moved little lower by 0.7% and 2% to Rs.10350 and Rs.8600 per Mt respectively. Prices in Gujarat and Uttar Pradesh moved up by 2.4% and 8% to Rs. 10080 and Rs.10900 per Mt at the market yard.
On NCDEX prices were mixed, while the Dec contract was down by 0.9% to Rs.9890, Feb contract was up by 1.62% to Rs.10620 per MT. January contract remained stable at Rs.10250 per MT. Mar contract closed at 10930 per MT. In the spot market, the price moved up in Karimnagar by 0.21% to Rs.8933 per MT, while in Nizamabad and Davangere prices remained stable at Rs.9275 and Rs.9160 per MT. On MCX , Dec contract closed 3.5% lower to Rs.9850 per MT.
Pearl Millet (Bajra) prices moved little lower by 1.1% to Rs.10450 per MT. Prices are higher than last year by almost 25% and against maize up by 9%.
Sorghum (Jowar) prices moved up by 24.8% this week to reach 14290 per MT. Prices are higher than last year by 35% and against maize up by 33.6%.
Barley prices moved lower by 7.5% at the market yard to Rs.9225 per MT. The prices are lower than last year by 0.8%. In the futures market, prices moved lower across all contracts. Dec down 0.57% to Rs.10016 per MT; Apr down 1.42% to Rs.10400 per MT; May down 0.46% to Rs.10640 per MT. In the spot market (Jaipur) as well prices were down by 0.61% to Rs.9384 per MT.
On CBOT the prices were up slightly for the 3 contracts, Dec up 0.14% to $153.92 per MT; Mar up 0.34% to $160.22 per MT and May up 0.33% to $164.16 per MT. The increased prices are reflected in the indicative FOB values as well. FOB Gulf for Dec – Feb is indicated at $184/185 per MT and for PNW indicated at $203-211 per MT. Sorghum (FOB US Gulf) is indicated at $191/193, little higher than corn.
DDGS prices moved up slightly for Dec at $166, while Jan price was indicated at $160 per MT (FOB, US Gulf), CNF prices wee indicated at $240 for Dec and $246 for Jan 2010.
There are some reports of toxins in US Corn due to higher moisture levels and delayed harvest. The trade and endusers are cautious and are testing corn and co-products before shipping/using the same. Food and Drug Administration (FDA) has set a maximum recommended level of toxins in different species of animals for trade and use.
Level for Afltoxin for poulry and dairy is set at 300 PPB and 20 PPB; Level for Fumonsin is set at 50 PPM and 15 PPM, while level for Vomitoxin have been set at 10 PPM and 5 PPM for the above species. FDA has also recommended levels of toxin containing ingredients in feed to limit the amount of toxin in the feed ration.
In India there is a major issue related to sugarcane prices, which is leading to delay it its harvest. The amended bill which is likely to be brought in the parliament on Monday will make sure that the differential in price F&RP (Fair and Remunerative price) and SAP (State Advised prices) will be paid by the sugar mills and not the state.
GOI also proposes to penalize oil companies, which are not blending ethanol in petrol at 5% level. With molasses production effected due to lower sugarcane production, this would be a major bottleneck in future as the demand is set to increase in the cattle feed sector.
Amit Sachdev
India Representative
U S Grains Council
usgcindia@gmail.com
Prices move up, first estimates confirm fears of lower production
Maize prices moved up again this week by 1% to reach Rs.9300 per MT. Prices are higher than last year
by 12.2%. While prices have been stable at Minimum Support Price (MSP) level in Andhra Pradesh, prices have move up in Rajasthan (up 10% to 10950 per MT) and Tamil nandu (4.5% to Rs;.8900 per MT) and were lower in Gujarat (3.8%, Rs.10040 per MT) and Uttar Pradesh (2.2% to Rs.9600 per MT).
In the futures market (NCDEX) prices have moved up by 2 – 4%. Nov and Dec contracts were up by 2% to Rs.9860 and Rs.10170 respectively. Jan contract was up by 3.3% to Rs.10210 per MT, while Feb was up by 4.3% to Rs.10830 per MT. In the spot market as well, prices moved up marginally in Nizamabad by 0.6% to Rs.9281 per MT; 0.8% in Karimnagar at 8840 per MT and 2.6% in Davangere at Rs.8816 per MT.
As per the first advance estimates for Khariff crop of 2009/10, maize production is expected at 12.61 MMT, down 9.28% from last year’s (2008/09), 13.90 MMT. The target for 2009/10 Khariff crop was fixed at 15.50 MMT. Possibly this is one reason for the prices moving up.
Prices of Pearl Millet (Bajra) moved up by 4.1% to Rs.10381 per MT and the prices are higher by 31.6% against last year. Prices are higher than maize by 10.4%. For the Khariff season of 2009/10, the production of Pearl Millet is expected at 5.83 MMT, down 33.98% from last year’s (2008/09) 8.83 MMT. The target for Khariff 2009/10 was fixed at 10 MMT
Sorghum (Jowar) prices are moved up by 13.1% to Rs.13200 per MT and against last year prices were higher by 31.2%. Prices remained higher than maize by 29.6%. The production of Sorghum in 2009/10, Khariff Season is expected to be 2.55 MMT, down 17.74% from last year’s Khariff production which was at 3.10 MMT. The target for 2009/10 Khariff crop was fixed at 4.10 MMT.
Barley prices have moved up by 8.9% this week to Rs.8650 per MT, but are lower than last year by 11.1%. GOI has increased the MSP for Barley for the Rabi Season by 10.29% (Rs.700 per MT) to Rs.7500 per MT. This is the biggest increase as MSP for wheat has been increased by Rs.200 per MT to Rs.11000 per MT, Gram by Rs.300 to Rs.17600 per MT.
In the futures market barley prices have moved up again this week. Dec contract was close to Rs10,580 per MT up 4.2%, while April contract was up 3.88% to Rs.11012 per MT. At the spot market in Jaipur prices moved up by 3.65% to Rs.9800 per MT.
As per the estimates, the overall loss of production for coarse cereals (maize, Sorghum, Pearl Millet, Ragi and Small Millets) is about 5.58 MMT, 19.69% lower than last year’s 28.34 MMT. The production is 9.89 MMT lower than the target fixed for Kahriff Coarse grain production (32.65 MMT). Will Rabi production be able to cover the loss in Khariff production, will be a question that would need to be answered in the next few weeks as the farmers plant the rabi crop.
On CBOT corn prices ended similar to last week, Dec $144.47 per MT; Mar $149.59 per MT and May $153.53 per MT. FOB values for Nov to Feb period for US Gulf ranged between $175-178 per MT and $200-201 per MT respectively.
DDGS demand in the domestic and export markets remained strong and poultry sector remained the biggest buyer. US gulf prices for DDGS were almost similar to last week Nov $163, Dec $160 and Jan $157. CNF prices in SEA region were indicated at $230-234 per Mt, due to the increase in freight costs.
For the bulk commodities, freight is strengthening and the benchmark rates for US Gulf Japan and PNW – Japan were indicated higher this week by $4 per Mt and $2.50 per MT to $70 and $39.50 per MT respectively. Agrentina – Brazil to China freight also ended $2 up against last week.
Amit Sachdev
India Representative,
U S Grains Council
E mail: usgcindia@gmail.com
Coarse grains prices show strength
Maize prices moved up again this week by 1.3% to Rs.9200 per MT on an average at market yard. The prices are higher than last year by 6.8%. At the state level, while prices are stable at MSP (Rs.8400 per MT) in Andhra Pradesh, they have risen steadily in Gujarat by 4.5% to Rs.10450 per MT; Rajasthan by 5.3% to Rs.9930 per MT; Uttar Pradesh by 7.6% to Rs.9850 per MT. Prices were down by 5.9% in Tamil Nadu to Rs.8550 per MT. In Maharashtra markets the prices was reported at Rs.8700 per MT. Reports are that arrivals have started. Punjab local is available at Rs.9900 per MT. Quality issues have been reported at some locations where wet maize is in the market. The average price of maize for Oct 2009 was 9084 per MT, 1.5% lower than Sept 2009, but 10.84% higher than Oct 2008.
On the futures market prices have moved up by 2 – 4%. For the closest month Nov, prices moved up by 2.2% to Rs.9660 per MT; Dec up 2.7% to 9770 per MT; Jan up 3.4% to Rs.10210 per MT and Feb up 4.2% to Rs.10380 per MT. In the spot market the price in Nizamabad was up by 2% to Rs.9225, but in Karimnagar and Davangere prices moved lower by 0.4% and 0.8% to Rs.8770 per MT and 8592 per MT respectively.
Pearl Millet prices have risen 14% this week to Rs.9950 per MT. Arrivals are good, but quality of the grain is an issue in Haryana, Punjab and Uttar Pradesh. Against last year, pries are up by 23%. Pearl Millet can be used in dairy/poultry rations, but the current price is higher than maize by 7.6%. making it difficult for the farmers to use the same. Average prices of Pearl Millet in Oct 2009 was Rs.9491 per MT, 4.85% higher than Sept 2009 and 26% higher than Oct 2008.
Sorghum price moved lower by 6% at the market yard to Rs.11680 per MT against last week, but remained higher than last year by 13.5%. Against maize the price is higher by 21%. The average price of Sorghum for Oct 2009 was Rs.11932 per MT, 1.5% lower than Sept 2009, but 24.8% higher than Oct 2008.
Barley prices have also moved up by 1.2% this week to Rs.7933 per MT. Prices remained lower than last year by 16.7%. The average prices of barley at the market yard for Oct 2009 was Rs.7856 per MT, similar to Sept 2009 price and 16.74% lower than Oct 2008 prices.
On the futures market prices moved up by 6 – 7%. For Dec contract the prices are up by 6.4% to 10150 per MT and for April up by 7.4% to Rs.10600 per MT. In the spot market the prices moved up by 10% to Rs.9454 per MT.
Corn prices ended lower this week as the weather is expected to be dry next week and harvest will proceed. Near month contract for Dec was down by 7.6% to $144.55 per MT. For Mar contract prices were down 7% to $149.59 per MT and for May the prices were down by 6.6% to $153.37 per MT. The FOB value too was down and indicated at $175-177 per MT for Nov – Feb for US Gulf, while for FOB PNW, prices were indicated at $200 per MT for the same window. Sorghum prices on FOB basis US gulf were indicated at $177/180 per MT.
DDGS FOB US Gulf prices are indicated at $ 166 for Nov; 4160 for Dec and $155 for Jan delivery. The reason being attributed to the drop is prices is the good quantum of corn and lower prices this week. The demand remains strong and the CNF prices are indicated at $225 per MT for SEA region.
The freight markets are also getting strengthened with US Gulf-Japan prices moving up by a dollar to $66 per MT. Argentina-Brazil to China freight rates have also been reported higher at $49-51 per MT.
Food grain production to be hit
Centre for Monitoring Indian Economy (CMIE) has projected that the Khariff Food Grain production for 2009/10 will be down to 98 MMT against 117.7 MMT last year. USDA has also projected that the rice production for the year 2009/10 will be down by 16-17 MMT.
In 2008/09, as per the 4th Advance Estimate by GOI, the food grain production in Khariff for Rice 84.58 MMT; Pulses 4.78 MMT, Pearl Millet (Bajra) 8.83 MMT; Sorghum (Jowar) 3.10 MMT; Maize 13.90 MMT; Ragi 2.06 MMT and Small Millets 0.45 MMT, making a total of 117.7 MMT. Rice constituted 71.86% of the total food grain package and if the production is down by 20% against last year to 68 MMT, as per estimates it would be 69.38% of the Khariff Food Grain production. The rest of food grains in 2008/09 totaled 33.12 MMT and in 2009/10 the total is expected to be 30 MMT, down 9.42% against last year. Which one will shall bear the brunt of the loss is still being counted, but there is no doubt that production of almost all food grains (pulses, coarse cereals) is hit. Reports indicate losses in Uttar Pradesh and Rajasthan due to drought, while in Andhra Pradesh and Karnataka the loss is due to floods and excessive rains.
Amit Sachdev
India Representative
U S Grains Council
E Mail: usgcindia@gmail.com
Higher prices of maize, reflect buying spurt; Prices in US move up due to wet weather concerns
Maize prices moved up at the market yard by 1% to Rs.9100 per MT range. Arrivals have started in almost all areas and prices are reported to be higher in all states except Uttar Pradesh, where they are down by 1.3% to Rs.9150 per MT. Prices in Andhra Pradesh moved up by 0.3% to 8400 per MT; Gujarat up by 4.4% to Rs.10,000 per MT; Karnataka up 2.6% to Rs.8650 per MT; Rajasthan up by 2.3% to Rs.9430 per MT and Tamil nadu up by 8.2% to 9088 per MT. This is for loose material at the market yard. The average price is higher than last year by 11.3%.
In the futures market (NCDEX), the prices for the four contracts moved up by 3 – 5%, which is substantial in the harvest time. Nov up 3.1% to Rs.9445 per MT; Dec up 4.5% to R.9700 per MT; Jan 2010 up by 5.37% to Rs.9870 per MT and Feb 2010 up by 4% to Rs.9960 per MT. In the spot markets prices have remained more or less stable with Nizamabad at Rs.9045 per MT; Karimnagar at Rs.8813 per MT and Davangere at Rs.8665 per MT.
Pearl Millet (BAJRA) prices moved lower at the market yard as arrivals have been very strong in the northern region. Prices moved lower by 8.9% to Rs.8760 per MT. Reports indicate that the quality may not be as good due to lower rainfall in some areas and also grain in shown black spots due to rainfall during the final harvest stages. Price is 9.1% higher than last year and about 4% lower than maize at the market yard (on average).
Sorghum (JOWAR) prices moved lower by 2.5% this week to Rs.12435 per MT. The prices are 25.3% higher than last year and almost 27% higher than maize at the market yard.
Barley prices have moved up by 1.8% this week. Prices however are lower than last year by 18%. Report are that new breweries are being set up as the demand of beer is increasing. The total beer market in growing by almost 15% per annum, which is making foreign brands look towards India and make investments to tap the Indian market.
In the futures trade (NCDEX) prices have moved up by 7.3% for the Dec contract to Rs.9540 per MT. For April 2010 as well prices were higher by 5.9% to Rs.9870 per MT. In the spot market (Jaipur), prices showed an upward trend by about 4% to Rs.8591 per MT. In the US, prices of barley on FOB basis US gulf is indicated at $175 to $185 per MT for Nov – Jan period.
Corn prices in the US have been fueled due to wet weather condition. Prices are up by almost $10 per MT on CBOT and that is also reflected in FOB values and the same is the case with DDGS prices.
On CBOT Dec corn closed at $156.52 per MT, up 6.6%; Mar corn was up 6.5% to $161.01 per MT while May corn was up 6.33% to $164.24 per MT. FOB US Gulf prices are indicated at $187 per MT for Oct’09 –Feb’10 while FOB PNW is indicated at $211/212 for the same period, reflecting a $10 per MT increase against last week’s prices. Freight rates have also shown an increasing trend. Benchmark Gulf-Japan and PNW-Japan freight rates have increased by almost 10% in one week to $65 – 65 per MT and $37 respectively. One reason could be the increase in crude prices, but then the demand for export is also higher. Argentina/Brazil – China freight rates have also gone up by almost 10% to $48 – 50 per MT.
DDGS (Dried Distillers Grains with solubles) is increasingly finding space in the livestock rations (poultry, dairy, fish, swine) across the globe. Current estimates put the figure at 4-9 – 5 MMT of DDGS export from US in 2009 (Jan – Dec). For the period Jan – August 2009, exports are up by 14%, the major change being China where imports are up to 93 TMT (+1947.12%). Imports by Thialand up by 85%, Philippines up by 22.8%; Korea up by 65.74%; Indonesia up by 93.4%. As per reports from USDA, Bangaldesh has imported trial batched totaling 1334 MT of DDGS during the period and all has been sold/consumed in Bangaldesh.
The current prices are higher, reflecting the change in corn prices in the US. FOB value, US gulf is indicated at $187 per MT for Nov and $179 per MT for Dec. CNF SEA region is indicated at $222 – 225 per MT for Nov, but lower at $218 per MT for Jan 2010.
Amit Sachdev,
India Representative,
US Grains Council.
Email: usgcindia@gmail.com
