India Starts Importing Duty-Free Corn from Myanmar Rising Demand Drives Imports Amid Tight Supply

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Three Ships Arrive in Tamil Nadu from Myanmar

India has started importing corn from Myanmar duty-free. Three ships have already arrived at VO Chidambaranar Port in Tamil Nadu’s Thoothukudi. They expect more ships by the end of July. According to Vangili Subramanian, President of Tamil Nadu Egg Poultry Farmers Marketing Society (PFMS), they have made deals for more imports. Initially, imports were made at $0,268 per kg, but prices have since increased. Sanjay Sancheti, Country Head at Olam Agro India Ltd, confirmed the arrival of one shipment, stating that prices have gone up. M Madan Prakash, President of the Agri Commodities Exporters Association, mentioned an offer of $0,286 per kg for July delivery but opted not to buy.

High Import Duties for Other Origins

Corn imports from Myanmar are duty-free as Myanmar is considered a least developed country. Imports from other countries face a 60% duty, a 5% IGST, and a 10% social welfare surcharge. However, the Centre allows tariff rate quota (TRQ) imports at a 15% concessional duty. In 2020, 0.5 million tonnes of corn were imported under TRQ. Nearly 0.3 million tonnes of corn could be imported duty-free if re-exported as starch. The first shipload from Myanmar was intended for starch, and the second for ethanol production. Subramanian noted the Tamil Nadu poultry sector’s demand for corn, with some firms already procuring the imported corn.

Domestic Corn Prices and Market Demand

The average price of corn in India is $0,251 per kg, matching the minimum support price (MSP) of $0,251 per kg. In some regions, prices exceed $0,288 per kg. On the Chicago Board of Trade, July corn contracts are at $0,177 per kg. Subramanian emphasized the need for corn imports to meet rising demand. Trade analyst S Chandrasekaran warned about market distortions from price arbitrage and preferential import tariffs, suggesting port restrictions and minimum import prices. The rabi corn crop in Bihar and West Bengal may be 10% lower due to weather issues, though Subramanian reported good yields in Bihar.

India’s duty-free corn imports from Myanmar are driven by increasing demand from the poultry, starch, and ethanol sectors. Despite domestic production challenges and high prices, imports aim to stabilize supply. The government is considering measures to manage market distortions and support local farmers. With growing demand, especially from the ethanol sector, the situation underscores the need for strategic import policies and domestic production support.