Corn production (also) in India are high
Corn production recorded 35.91 Million Tonnes and added to Indian farmers’ woes. “There is plenty of corn this year in India. Processors such as starch makers, exporters and trading houses have bought huge quantities since prices at the farm level are around USD 0,20” said an exporter. Data from Agmarknet, a unit of the Agriculture Ministry, show that the national weighted average price of corn is USD 0,22 per kg against the Minimum Support Price (MSP) of USD 0,23 per kg.
Corn export is less than the previous year – Value has gained momentum
Recent data from the Agricultural and Processed Food Products Export Development Authority (APEDA) show that corn exports in 2022-23 declined to 3.45 Million Tonnes from 3.69 Million Tonnes in 2021-22. Also, the US Department of Agriculture forecasted that India’s maize exports will drop to 3.6 Million Tonnes from 4 Million Tonnes in 2023.
On the contrary, the value of exports has increased to 1.12 Billion USD against 1.02 Billion USD from the previous fiscal.
Corn export from India is likely to drop by 10% due to higher global production
It seems that global production of maize is very high this year. Food and Agricultural Organization (FAO) and The Agricultural Marketing Information System (AMIS) provided information that global corn production is set to rebound in 2023, rising by 4.2% from 2022, mostly resting on larger harvests in the US, Brazil, and the EU.
Looking at the global production and current international market scenario, India’s corn (maize) exports will likely drop by 10% during 2023-24 as global production is estimated to rise to over 1,200 Million Tonnes (mt). The global surplus production is impacting corn prices in India too.
Corn from South America is cheaper by 10 USD compared to India
“We recently exported corn at $265 a tonne. Prices have dropped sharply. We hear corn from South America is available at $255 for July in Vietnam,” said M Madan Prakash, President of the Agricultural Commodities Exporters Association. If the South American contracts are signed in July, buyers in Vietnam could get corn in August. “Only a short window is available for corn exports and we are trying to make use of it,” Prakash said.
US research agency BMI, a Fitch Solutions unit, said it expects second-month corn futures to trade at an average price of USD 6.10 per bushel (means USD 240.10 per tonne) in 2023, a downsizing of 6.2% from the forecast it made at March-end.