May 11, 2012

Indian food grains' demand up on competitive pricing

On the back of competitive pricing and weakening of rupee against the US dollars, demand for Indian food grains has rose globally.

According to reports with the rise in price of soy and soy based feeds due to drop in production in the major growing areas has forced the global live stock industry to change the focus to corn (corn) based feeds as it is presently cheaper than other feeds.

India's corn is quoted at US$260 a tonne for rabi harvest and US$250 for kharif which is much lower than US. Also the Indian rupee is trading lower against US dollar. This has attracted the global buyers towards India and presently enquiries have come from Iran and Egypt for Indian corn. As per an earlier estimate from International Grains Council (IGC) the global corn (Corn) production is likely to be around 853 million tonnes for 2011-12. Similar is the case with other Indian food grains like rice and wheat. Indian parity for rice and wheat is much lower than other global vendors.

Production of rice, wheat, and corn is expected to be around 103.41 million tonnes, 90 million tonnes and 21 million tonnes respectively. In Inter Continental Exchange (ICE) for May delivery wheat traded at US$591 2/8 per bushel and corn traded at US$641 2/8 per bushel on May 9. And In India s National Commodity and Derivatives Exchange (NCDEX) for May delivery corn traded down 0.88% to INR1,124 (US$21) per qtl and wheat traded down 0.25% to INR1,183 (US$22) per bushel on May 10 at 10:40 IST.