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Maize prices fall 15% on the back of rising imports

Prices of the grain, which is largely consumed by the poultry feed and starch manufacturers, have remained firm for the past two years because of poor weather and damage caused by pests. Foreign firms such as Louis Dreyfus, Cargill, Cofco, Olam and Glencore, and other companies including Suguna Feed, Roquette, Godrej Agrovet and SKM Animal Feeds were importing maize.

, ET Bureau|
Last Updated: Jan 18, 2020, 07.35 PM IST
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The industry expects the government to put a ban on imports by February ahead of the arrival of the new crop in March to protect domestic farmers.
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New Delhi: Maize prices have fallen 15% to Rs 2,150 a quintal in the past month owing to higher imports from Ukraine, Myanmar and Russia, traders and company executives said.

Anticipation of a higher output from Bihar and West Bengal also weakened prices, they said.

Prices of the grain, which is largely consumed by the poultry feed and starch manufacturers, have remained firm for the past two years because of poor weather and damage caused by pests.

Foreign firms such as Louis Dreyfus, Cargill, Cofco, Olam and Glencore, and other companies including Suguna Feed, Roquette, Godrej Agrovet and SKM Animal Feeds were importing maize, traders said.

They said future contracts of up to 450,000- 500,000 tonnes of maize have been signed, which will land on Indian ports by February-March. Further, the state-run trading company MMTC recently increased the quantity of maize imports in a recent tender to 175,000 tonnes from 125,000, which will also put pressure on prices, they said.

“Prices are continuously correcting with government opening import for private traders from January 1. We expect another 10% fall with the arrivals of the ships by February,” said Rajesh Kumar of Naya Bazar, Delhi-based Shiv Shakti Traders.

Kumar said with landed cost of imported maize at ports coming at Rs 1,950-2,000 a quintal, prices will remain stable at this level.

The industry expects the government to put a ban on imports by February ahead of the arrival of the new crop in March to protect domestic farmers.

Maize prices, which have been rising since 2018, hit an all-time high of Rs 2,500 a quintal in December 2019. Traders said maize is currently selling at Rs 2,150 a quintal in the wholesale market of Delhi, at Rs 2,050 in Sangli mandi of Maharashtra, Rs 1,950 in Chhindwara mandi of Madhya Pradesh and Rs 2,200 a quintal in Gulabbagh mandi in Bihar.

“This year, rabi sowing is higher and with good weather, we expect production to be 10% higher at 9 million tonnes. Cattle feed, poultry, starch and biofuel industry will be the net gainers,” said an executive at a trading company.

In 2019-20, kharif crop quality was not good due to extended rains in Maharashtra, Karnataka and Madhya Pradesh. As per the first advance estimate released by the agriculture ministry, kharif crop output was 6.6% less than the target at 19.89 million tonnes. The target for rabi crop for 2019-20 was 7.6 million tonnes. In 2018-19, rabi maize production was at 8.18 million tonnes.

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