Even as the maize prices are expected to remain stable after a correction in response to the imports being undertaken by state trading company PEC, trade veterans think that the industry has a short window of two months to get import allocations for 2016-17 from the government in order to keep the prices cool during the rest of the year.
Maize prices have declined by about Rs 750/tonne since January 2nd week, giving a relief to end users like poultry and the starch industry. The NCDEX spot prices for Nizamabad have declined marginally in last two weeks of January by 0.45%. “More stocks are being liquidated now after the import process started,” said Vasant Kumar Shetty, convener, All India Broiler Co-ordination Committee. However, as the gap between demand and supply is huge, the prices are still high for the feed industry. “The total gap in demand and supply is more than 1 million tons. For the prices to cool down, the Indian government has to import more corn to fill this gap in demand and supply due to a sharp fall in Kharif corn production,” said Rajiv Yadav, vice president (grains and oilseeds), Noble Agri.
Commerce Ministry has allowed PEC to import 5 lakh tonne maize under Tarrif Rate Quota (TRQ) at zero duty. PEC had floated first tender for import of 2.90 lakh tonne maize, with a condition that it will be 100% non-GMO. Industry sources said that PEC will have to import 5 lakh tonne maize before March 31. But, in order to keep the prices controlled during May to August, when prices normally remain high, the industry wants the government to allocate import for 2016-17 by February.
“With the rabi harvest expected from April onward, there is a short window of 3 months for the shipments to come and cool domestic prices. Imports beyond March may not be allowed by the government due to new crop corn arrivals out of rabi crop and imported corn might have an adverse effect on corn farmers,” said Yadav.
Currently, there is fresh arrival from the ongoing harvest of the late kharif crop from Karnataka, while the rabi crop is expected to arrive from end of March.
Source : Economic Times