India’s corn exports likely to drop 10% on higher global output
India’s exports of maize (maize) are likely to decline by 10 percent over the period 2023-24 as global production is expected to rise to more than 1,200 million tonnes.
According to the USDA, Indian maize exports are likely to drop to 3.6 million tons from 4 million tons. Data from the Food and Agricultural Products Export Development Authority (APEDA) shows that corn exports in 2022-23 fell to 3.45 metric tons from 3.69 in 2021-22. However, the value of exports increased to $1.12 billion compared to $1.02 billion in the previous fiscal year.
short window
We recently exported corn at $265 a ton. Prices have fallen sharply. “We hear that maize from South America is available at $255 for the month of July in Vietnam,” said M Madan Prakash, president of the Agricultural Commodity Exporters Association.
If South American contracts are signed in July, buyers in Vietnam can get corn from August. “There is only a short window available for maize export and we are trying to take advantage of it,” Prakash said.
Global maize production is set to rebound in 2023, rising 4.2 percent from 2022, mostly based on larger harvests in the United States, Brazil and the European Union, the Food and Agriculture Organization’s (FAO) Agricultural Marketing Information System (AMIS) said. .
price forecast
The USDA said crops are higher in Brazil, India and South Africa. The US agency put global production at 1,222.76 metric tons, while AMIS estimated production at 1,212 million tons.
US research agency BMI, a unit of Fitch Solutions, said it expects second-month corn futures to trade at an average price of $6.10 a bushel ($240.10 a ton) in 2023, a 6.2 percent contraction from the forecast it made at the March-end.
Right now, corn on the Chicago Board of Trade is priced at cash at $6.36 a bushel ($251), while July futures is at $6.18 ($239.5).
The global overproduction has an impact on maize prices in India as well. Data from Agmarknet, a unit of the Department of Agriculture, shows the nationally weighted average price of corn is 1,867 quintals against the minimum support price of $1,962.
store
The record maize production of 35.91 metric tons also added to the problems for Indian farmers. “There is a lot of maize this year in India. Processors like starch makers, exporters and trading houses have bought huge quantities because prices at farm level are around Rs 1,700,” said one of the exporters.
The source, who visited Gulab Bagh Mandi, one of the largest maize producing areas, said coarse grains are being stored in the area as it was 200 kilometers away from the Bangladesh border.
In the short term, the uncertain future of the Black Sea Beans initiative will present the biggest upside risk to the price outlook, BMI said.
“…we have identified bearish sentiment in the crude oil market, mainland Chinese demand, and an expected global economic slowdown as the main downside risks,” the research agency said.
Global production is expected to rise 7.2 percent year-on-year to 1,232.9 metric tons in the next business year, BMI said the global balance will shift from deficit in 2021-22 to surplus.
Stocks ending at more than 300 million trades are expected to rise next year, adding to the downward trend.