January 17, 2008

 

India soy, corn futures weaken on bird flu woes

 

 

India's soy and corn futures declined on Wednesday amidst worries that feed demand from poultry producers may falter following the most recent bird flu outbreaks.

 

The country's poultry industry consumes the largest chunk of the soymeal and corn market.

 

Veeresh Hiremath, an analyst with Karvy Comtrade, said that bird flu cases may lessen the need for feed, thus pulling down skyrocketing corn and soy prices.

 

At 12:14 p.m. on Wednesday, the benchmark February soy contract fell by 0.80 percent at INR2,119 (US$54) per 100 kilogramme on the National Commodity and Derivatives Exchange.

 

The benchmark February corn contract was also down 0.76 percent at INR844.50 (US$22) per 100 kg.

 

The occurrence of bird flu is said to have temporarily ended the recent rally of corn and soy prices, according to a trader based in Sangli, Maharashtra.

 

In the past month, the benchmark soy and corn contracts have risen to more than 10 percent.

 

Meanwhile, poultry exports are also estimated to fall as government officials expect bans from major importing countries.

 

Indian officials said it could take up to a week to cull about 400,000 birds in the West Bengal state.

 

However, the government reassured that the recent bird flu outbreak is contained in West Bengal and will not affect the entire poultry industry.

 

B. Soundarajan, managing director of Suguna Poultry Farm Ltd, told Reuters that things are normal in other parts of India.

 

Vasant Kumar, managing director of Balkrishna Hatcheries, said there will be some panic in the market but they will wait 3-4 days. The company has sold around 500 tonnes of eggs in the Mumbai market yesterday, which is normal.

 

Major importing countries like the Middle East has banned imports from India but lifted restrictions after India declared itself bird-flu free last year.