Corn (maize) exports have dropped to a trickle as only a few buyers are out in the global market. High moisture in the crop in South India is also affecting the shipments.
Maharashtra crop
“Exports are not taking place at the pace we witnessed last year. Currently, only the crop from Maharashtra is meeting the export standard. Shipments are taking place from there,” said Mr Madan Prakash Murughasan, Director of the Chennai-based Exim Rajathi India Pvt Ltd.
“Vietnam is one of the few countries looking for corn but it is offering only $230-235(Rs 10,600-10,825) c&f (cost and freight) a tonne. But there is no parity in selling at that rate,” said Mr A. Rajkumar of the Chennai-based Alagendran Group of Companies.
Exporters are able to get corn at around Rs 10,000 a tonne and if transportation, packaging, shipping and other charges are to be worked out, they hardly make any gain.
“Vietnam is asking for corn with 13 per cent moisture. But we are getting crop with 14 per cent moisture here. This could lead to problems as the shipments could get spoilt. Therefore, we are not interested in exports,” Mr Rajkumar said.
High moisture
The recent rains have led to high moisture in the kharif crop that is being harvested.
“The crop from Karnataka has high moisture,” said Mr Murughasan, adding that the percentage of damage to the crop from that State was also higher at eight per cent against the permitted global standard of five per cent.
“Aflatoxin (a fungus) is also higher in the crop,” Mr Murughasan said.
“There are other problems such as finding a domestic seller. Last year, we were able to get people who could sell us 500 tonnes at a time. Now, we are unable to find anyone who can sell more than 100 tonnes,” Mr Rajkumar said.
Keeping off
Though corn is available at Rs 850-900 a quintal at the farm-gates, it is quoting higher at main markets. In Hyderabad, for example, it is ruling at Rs 925. In New Delhi, it was quoted at Rs 1,085 on Thursday.
“Big exporters are keeping off. They may stay away until mid-January because they are in no position to ship the consignments,” Mr Rajkumar said.
Trade sources said some of the exporters who had struck deals to export at $205-215 were now facing problems and supply default is feared. “Thailand has emerged a serious competitor. It has a good crop and the Asean (Association of South-East Asian Nations) trade pact is helping the nation. Buyers in Malaysia or Vietnam need not pay Customs duty for corn imports even if they have to pay $2-3 higher for Thai corn,” said Mr Murughasan.
Traders said some business had been done with Malaysia, where buyers were offering $224 (Rs 10,325) at the most.
One Indian exporter who has a long-term buyer and has a partnership with a Singapore trade firm was shipping to the eastern coast in Malaysia.
Low arrivals
According to Mr Murughasan, arrivals are currently low. “We expect arrivals to increase in January,” he said.
Mr Rajkumar said arrivals from Andhra Pradesh were negligible, while Karnataka growers are reportedly holding on to their produce. “The recent rains in southern India is also a reason for the low arrivals,” he said.harif corn production has been estimated at 12.61 million tonnes against 13.90 million tonnes last year. Andhra Pradesh has emerged the main problem area for kharif corn with the crop being 34 per cent lower at 1.25 million tonnes. Corn exports have picked up since 2007-08, when 5.5 million tonnes were shipped out, mainly on demand from South-East Asia and the Far-East. Last year, exports are estimated to have touched 3.5 million tonnes.
Source : Business Line