PAU EXPERTS PREDICT MAIZE PRICES TO PREVAIL ABOVE MSP

LUDHIANA, OCTOBER 15:-----



The maize arrival is in progress in the markets of Punjab state and farmers are receiving prices for their produce ranging from Rs 900 to 1000 per quintal depending upon the quality, which are higher than Minimum Support Price (MSP) (Rs. 880 per quintal). This was informed by Dr. J.S.Sidhu, Incharge of the Agricultural Market Intelligence Centre (AMIC), Department of Economics and Sociology, while sharing the analysis based on past behaviour of market prices of maize along with national and international prospects of crop. He predicted that the maize prices will prevail above the MSP in current marketing season. Recent estimates regarding the production and market sentiments for maize crop at the national and international level becomes available which may influence the prices of maize during the coming months, he said.

The major maize producing countries are US, China, Mexico, Brazil, Argentina, France and India. USA accounts for about 40 % of the world's output. According to the latest release of International Grains Council (IGC) the world maize production will increase to a record 824 million tonnes (mt) during the 2010-11, as compared to 810 mt during 2009-10. Relative higher prices of feed grade wheat and barley are expected to shift some demand to maize, observed Dr. Sidhu. Total maize consumption during 2010-11 is forecast to a new high of 837 mt, including 485 mt for animal feed. Thus, world maize demand expected to out strip the production which may put pressure on international maize prices, remarked Dr. Sidhu adding that the international maize prices have already surged in last two months attributing to the concerns about smaller than anticipated US maize yields.

Discussing the Indian scenario, Dr. Sidhu said that in India, about 50 % of maize is consumed by poultry sector followed by human consumption (26%), industrial use (12%) animal feed and seed (12% each). India produces about 2 % of world maize production. However area, production and yield of maize in India is increasing for the last five decades, he said. Andhra Pradesh is the leading maize producing state in India contributing about 21 % of total maize production followed by Karnataka (16%), Rajasthan (10%), Bihar and Maharashtra (9% each) and Uttar Pradesh and Madhya Pradesh (6% each). Maize is mainly grown during kharif season and its production largely depends upon monsoon rains. Total production of maize in India touched 19.73 mt during 2008-09. Due to the poor monsoon rains during kharif 2009-10, the production of maize declined to 16.68 mt from estimated area of 8.27 mha. During the current year the production of maize is expected to be more than 19 mt due to increase in area under the crop along with good monsoon rains in major producing states, shared Dr. Sidhu.

The area under maize in Punjab was 1.39 lakh hectares with a production of 4.75 lakh tonnes during 2009-10. During current year the area under maize in Punjab state is estimated to be about 1.60 lakh hectares, while the production is estimated at 5.61 lakh tonnes. The demand for maize in Punjab is normally more than the state production which results into higher prices than the MSP. Maize future prices quoted by MCX and NCDEX are also being in the range of Rs. 1010 per quintal to Rs. 1080 per quintal for months from November to February, 2010-11. Keeping in view all the above information the AMIC is of the opinion that the maize prices in Punjab are expected to prevail in the range of Rs. 1000 to Rs. 1100 per quintal during the next three months. Farmers can use this information for taking their storage or selling decisions to fetch higher price of their produce, he said.


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