As the market resumes after the Diwali holiday on October 27, corn prices in Chhindwara traded down Rs 150 per quintal to Rs 2,100 per quintal. The price drop was in line with our expectations and hit our short-term target of Rs 2,100 as mentioned in our recent weekly report.
Corn The price will continue to fall and may even correct to Rs 1,900 in the coming days. The price will trade weakly unless it trades below the trend reversal point of Rs 2,239.
Demand from the poultry feed industry has continued to spread over the past few months as feed traders and millers are waiting for the new crop to catch up and adjust to lower prices. Therefore, with the price falling, they will start buying in the coming days.
The weather is still favorable for farmers to continue harvesting activities in the past days. In addition, the forecast for the next 5 days is still supportive for the harvest, which will increase the amount of new crops on the market.
New corn arrivals in India from October 1 to 27, 2022 were 297 KMT, down 34.4% year-on-year. The breakdown of arrivals by state is as follows – Madhya Pradesh 123 KMT (-53.7% YoY), Maharashtra 37 KMT (-19.8% YoY), Rajasthan 29 KMT (+ 2.24% YoY) , Karnataka 17 KMT (-39.5% YoY) ) and Telangana 18 KMT (-22% YoY).
This year, arrivals were delayed due to unseasonal rains in October. Therefore, new crops will increase in November, which will put pressure on corn prices in the short and medium term.
ETMarkets.comSource: Agmarknet
Kharif corn production estimated 2022-23
In our rough estimate, we expect maize production at 21.95 million tons, 1% higher than the previous year’s 21.77 million tons.
Corn acreage is estimated to be flat from last year while yield is expected to increase 1% year over year due to favorable weather conditions in key corn producing states this year. Higher production in Madhya Pradesh and Rajasthan will offset the production loss from Karnataka.
Meanwhile, the progress of sowing rabi corn is in the early stages. Seeding started in some districts of Karnataka, Maharashtra, West Bengal and Tamil Nadu.
The total cultivated area reached 0.65 thousand hectares compared with 0.43 thousand hectares in the same period last year. Sowing will accelerate in key production areas in the coming days. Maintaining optimal soil moisture levels in the key producing states will promote rabi seed sowing.
Corn exports in the period 2021-22 (October 21 to August 22) were 33.1 thousand tons, down 5% compared to the same period last year. The main export sources are Bangladesh 17.24 thousand tons (+ 3.27 thousand tons by year), Vietnam 7,17 thousand tons (-3.84 thousand tons by year), Nepal 4,60 thousand tons (-0). ,89 thousand tons by year and Malaysia 2.11 thousand tons (-0.41 thousand tons by year) ).
With the continued adjustment of domestic corn prices amid stable global corn prices, India will become competitive to export to Southeast Asian nations. Export demand will also increase from neighboring Bangladesh and Nepal.
ETMarkets.comSource: DGFT
ETMarkets.comSource: DGFT
(Author is Senior Manager (Commodity Research), Origo Commodities)
(Disclaimer: The recommendations, suggestions, views and opinions expressed by experts are their own. They do not represent the views of The Economic Times)
