April 26, 2004

 

 

India Sells 50,000 Tons Corn To Malaysia
 

India has sold 50,000 tons of corn to Malaysia at $182 a ton for May shipment, a leading trader said on Friday.

 

It is the first time in recent years that India has turned to corn exports following a firming of international prices and a lack of sales from China, which has fed the Southeast Asian market until now.

 

India has already sold 300,000 tons of corn and exports are likely to cross 500,000 tons by June.

 

"This was a good deal. There was hardly any business for the last 15 days," the trader said.

 

The country mainly sells the grain to Malaysia, Indonesia, South Korea, Vietnam and the Philippines. Some sales in smaller quantities have been reported to the Middle East.

 

"The way things are, our exports are expected to touch one million tons by December," said one Ahmedabad-based grains trader.

 

The Asian feed market has been scouting for alternatives as export offers of Chinese corn have dwindled due to a drop in local stocks.

 

Some Asian millers are snapping up ingredients like cassava, palm kernel and broken rice that can be used as an alternative to corn, whose global prices have hit 6-1/2-year highs.

 

"We started the season in December by selling at $120 a ton FOB and now prices have gone up to $155 a ton," the grains trader said.

 

India's corn output is expected to surge to 14 million tons in 2003-04 (October-September) compared with an average production of 12 million tons because last year's monsoon rains were the best in a decade.

 

Sowing for Indian corn, mainly a winter crop, takes place in August and harvesting begins in November. It is largely grown in southern and western India.

 

"This year many Asian buyers are keen on us because freight rates have really shot up and it is expensive to buy from Argentina and United States," he said.

 

Dealers said freight rates of bulk cargo from India to destinations in Southeast Asia have surged to $35-40 a ton, up from $20-25 a ton a year ago.

 

But freight rates from the United States to Southeast Asia were touching $80-100 a ton, making Indian corn purchases economical.