The first lot of 225,000 MT of maize shipments to India from Ukraine are on the way and are likely to reach the ports by third week of Feb 2016. Since the TRQ is for 0.5 MMT, and the demand is there, PEC limited came out with the second tender to import 240,000 MT of corn. The shipment dates are from Feb 20 Mar 04, 2016 and all consignment must be cleared on or before Mar 31, 2016 as the TRQ expires on the said date.
The current scenario for the Rabi maize crop looks good at this point, but the arrival is over 50 days away (Apr 1, 2016). Reports indicate a good crop in Bihar and the future prices reflect that, though it only a sentiment at this point. Feb contract down 2.89% to Rs. 13790/MT; Mar down 2.26% to Rs. 13860/MT; Apr down 1.85% to Rs. 12200/MT and May down 1.15% to Rs. 12200/MT. Jun contract was at Rs. 12060/MT. The spot prices have been stable for some time now and the buying by poultry and starch sector remains slow and the prices there too were down. Nizamabad down 0.64% to Rs. 15015/MT; Davangere down 1.32% to Rs. 14950/MT; Karimnagar down 0.22% to Rs. 15033/MT; Sangli down 2.04% to Rs. 15000/MT Gulabbagh prices were up at Rs. 16145/MT. With imports now on the way and the new tender out for imports before the new crop arrives in the market, the prices are likely to remain stable. But the new crop of Rabi many not fulfil the needs of maize in country and hence the industry will need to ask for the TRQ allocation for 2016/17 and imports could be affected in Jul-Sept period, when the domestic maize is not available.
In the International market there are many pressures, like currency volatility, weather in South America (Argentina and Brazil) that could affect the sowing. USDA report is expected soon and may give outcome hints of the future prices, but for the time being the prices have been stable for some time now. Mar contract down 1.43% t0 $143.93/MT; May down 1.62% to $145.90/MT and Jul down 1.44% to $148.02/MT. Comparatively the freight market too has been down and stable, with the benchmark US Gulf-Japan freight costs at $22.5/MT; PNW-Japan at $12.50/MT; US Gulf-China at $20/Mt and PNW-China at $11.50/MT; Argentina-Brazil to China freight is at $24-12.50/MT depending on tonnage and discharge.
On the co-product front, DDGS remains competitive at $181-195/MT FOB US Gulf and pNW) and is being delivered to Vietnam at $230/MT in Feb and down to $220/MT in April. Delivered price to China is indicated t $210/MT in Fen and down to $207/MT in April 2016. Taking a median price DDGS at 28% protein and 6% fat could be delivered to India ports at $225/MT in April 2016 and with all clearing costs could be delivered to feed mills close to ports at under Rs. 18000/MT, much cheaper than the current Soybean which is priced at Rs. 38000/Mt (43% protein); Peanut meal in the range of Rs. 28000-30,000/MT for 40-45% protein; Mustard Cake at Rs. 22000/MT and domestic DDGS at Rs. 28,000/Mt or more, with inconsistent quality. With such high priced ingredients it is just not possible for Indian poultry operators to complete in the world market. Bangladesh is better off by importing low prices ingredients from the world market and making available reasonable priced animal protein available to the population. CGM prices in US are now at $545/MT.
Source: TechproIndia
