NEW DELHI (Commoditiescontrol) – As arrivals of new maize crop are rising gradually in the markets of major kharif maize growing belts, downward movement in prices are being observed. However, prices of new crop opened firm in the ongoing Kharif marketing season beginning from October 1, amid languishing supply as production was of maize was down in the past crop season 2015-16 (July-June) due to back to back two consecutive years of drought but improved and well distributed rainfall boosted maize farming this year as acreage of maize in the country rose by 14.84 percent to 83.89 lakh hectares as compared 76.73 lakh hectares a year ago.
Harvesting of Maize began across the country early this month except Maharashtra, where recent rainfall delayed harvesting. Rains over Telangana also disturbed and delayed harvesting of crop.
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Sowing of maize had delayed across the main growing regions by a week due slow progress of Monsoon, reported Edelweiss Agri Research. The researcher has estimated India’s Kharif maize production at 140.5 lakh tonnes against 115 lakh tonnes corresponding year ago.
According to the report, dry spell has impacted potential yields especially in Karnataka, parts of Madhya Pradesh and Telangana and overall kharif maize productivity in India stands at 2.046 MT/ha against 1.691 MT/ha of last year, higher by 21%. Average productivity in last five years is pegged at 2.052 MT/ha and productivity in Karnataka, Uttar Pradesh and Madhya Pradesh estimated to be lower than last year by 17%, 6.4% and 1.4% respectively. Yield loss in major growing districts (Chindawara & Seoni) of Madhya Pradesh is offset by increase in yields in other districts.
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According to Edelweiss Agri Research report, maize beginning stocks for 2016-17 pegged near 2.41 Lakh MT against 9.0 Lakh MT of last year's stocks.
Stocks with govt are nil this year and stocks to Use ratio for 2015-16 are pegged around 1.26%, this year it is expected to be higher towards 4.29%.
Export demand is expected to be lower by 15% due to prevailing export disparity and exports from India are expected to be around 3.10 lakh MT (container exports) against 3.64 Lakh MT exported during 2015-16.
However, the first advance estimates for major crop production released by the Department of Agriculture, Cooperation and Farmers Welfare projected maize output in the kharif season 2016-17 at 193 lakh tonnes against 152.4 lakh tonnes last year.
The current year’s estimate also stands higher than government target for the season at 175 lakh tonnes.
It should be noted that the fourth advance estimates for rabi crops had estimated maize output in the rabi season 2015-16 at 65.6 lakh tonnes against 71.6 lakh tonnes a corresponding year-ago period.
In last fifteen days, maize prices have fallen Rs. 50-75/100kg at Gulab Bagh, a major trading centre in Bihar where crop arrived in rabi season. Maize was priced at Rs. 1450-1,500/100kg previous day at Gulab Bagh. New maize crop also witnessed a slump by Rs. 50-100/100kg in the markets of Madhya Pradesh and Rajasthan with rise in arrivals as prices are currently ruling at Rs. 1,100-1,400/100kg.
However, prices are down mainly due to moisture content as crop with low moisture was offered at Rs. 1,200-1,450/100kg at Bundi and Baran market on Tuesday, said trade sources.
At Future trade, maize prices slipped over 10 percent in last fifteen days. October delivery maize contract had closed at Rs. 1,664 on October 3, 2016 which declined Rs. 172 to close at Rs. 1,492 on October 18, 2016 at National Commodity and Derivatives Exchange Ltd (NCDEX). Likewise, the closing value of November delivery future contract was Rs. 1,458 on October 3, 2016 which slipped Rs. 122 to close at Rs. 1,336 on October 18.
The above balance sheet shows surplus stocks of maize in the crop year 2016-17, hence, there is least possibility of much hike in prices. On the other hand, industrial buying for grain is expected to remain firm, especially from animal and poultry feed manufacturing sector which will prop up prices throughout the year despite high production estimates as prices of wheat, rice, barley and other coarse grains generally used as a substitute of maize for poultry feed units are also ruling higher than the current prices of maize, asserted a market observer.
(By Commoditiescontrol Bureau; +91-22-40015533)
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