The proof is that Indian exporters received requests to ship a significant volume of corn until next March, according to traders.
Indian corn attracts customers
By mid-2021, demand had picked up after global corn prices fell to their biggest drop in 10 years, and India’s exporters were in fierce competition with each other.
“Globally falling prices make Southeast Asian buyers more focused on Indian corn. But there is strong competition among shippers, leading to narrow margins,” said M Madan Prakash, President of the Agri Commodities Exporters Association (ACEA).
“There is great demand from Indonesia, Vietnam and Indonesia. We are receiving new orders to be fulfilled in the next three months,” said Mukesh Singh, Director of MuBala Agro.
After March, Southeast Asian countries will have their own corn crops to help meet domestic demand.
According to data from the Agricultural and Processed Food Products Export Development Authority (APEDA), India exported 19.58 thousand tons of maize, worth about 38,360 million rupees. (equivalent to nearly 509 million USD) for the period from April to October this financial year compared with 12.71 thousand tons of corn worth 20,460 million rupees (equivalent to nearly 271 million USD) in the same period last year.
According to the statistics of the General Department of Vietnam Customs, compared with the same period in 2020, the amount of corn imported from India in the past 8 months increased by more than 562 times (the same period reached nearly 2 thousand tons), while the turnover increased about 494 times.
The US Department of Agriculture (USDA) in its “Grains: World Markets and Trade” report, has pegged India’s corn exports lower for 2021-22 (July 2021 to June 2022). ) at 25 thousand tons compared to 37.5 thousand tons in 2020-21.
Although the reason is not specified, it may be because neighboring countries such as Bangladesh may import slightly less this fiscal. Bangladesh imported 15.66k tonnes in the last fiscal and on trends in the first half of the year, its imports could be lower.
But Mumbai-based Singh’s MuBala says exporters will see much happening in the next three months as they, along with growers, have begun holding back inventories.
“We are holding back [exports] because we think prices will increase in the coming months. Right now, we are purchasing corn at Rs 15,000-15,500/ton and will even buy when the price increases by Rs 500/ton,” he said.
Currently, exporters like him are sourcing corn from Maharashtra. “We are buying corn at Rs 17,250 – 17,500 a tonne from Nashik to ship to Mumbai,” said ACEA’s Prakash.
Kharif’s corn crop
“We are sourcing maize from Odisha and Karnataka for Bangladesh,” said Bimal Bengani, Managing Director of Bengali Export Pvt India Ltd, based in Kolkata.
Currently, Indian exporters are quoting corn prices at $265-270/ton with free delivery. According to the International Grains Council (IGC), Brazil is quoting corn at $276/ton, the US at $267/ton and Argentina at $255/ton. In July this year, the price of corn reached $300/ton and was even higher than wheat.
Exporters say that the Kharif crop has been harvested and of good quality. While the new Maharashtra crop is being supplied for export to Southeast Asia, Singh said for Bangladesh, stocks of the April harvest from Bihar have already been sent.
He said exporters are entering small deals with importers in Vietnam, Indonesia and Malaysia because it is a safe option. In addition, buyers are also taking comfort from last year’s bitter experience when some merchants canceled their trades as prices rose.
“Last year, some of our traders reverted to futures as prices rose. It annoys importers. So they’re a little careful this year,” Singh said.
Optimism despite bearish signals
Despite bearish signals from the Food and Trade Organization as well as the IGC, exporters remain confident in the upbeat outlook for maize.
According to ING Think, the economic and financial analysis division of the Dutch multinational financial services company ING, moderate ending stocks in the US and the world signal a downtrend.
The FAO, in the Market Monitor report released by their Agricultural Market Information System, said maize production for the period 2021-22 is expected to reach a new record of 1,199.7 million tonnes compared with with 1,157.8 million tonnes last season.
The FAO said that global trade this year is likely to fall by 187.2 million tons (last year 190.6 million tons) and ending stocks are estimated at 292.8 million tons (last year was 285.7 million tons). ).
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