Maize prices soften due to weak demand
Maize prices in India are softening due to weak poultry sector demand amid bird flu outbreaks, subsidized rice for ethanol production, and an 8.8% increase in Rabi season maize cultivation. Prices in Madhya Pradesh have fallen to ₹2200-2325 per quintal despite a 6.5% MSP hike. With stable domestic supply and subdued exports, further price declines are possible.
iGrain India – The article highlights that maize prices are experiencing a softening trend due to a combination of factors:
Weak Poultry Sector Demand: The bird flu outbreak in states like Andhra Pradesh, Telangana, West Bengal, and Jharkhand has weakened the demand for maize from the poultry sector, as it is a key ingredient in poultry feed.
Subsidized Rice for Ethanol Production: The Food Corporation of India (FCI) is offering rice at a subsidized price to ethanol manufacturers, which has reduced the demand for maize, a competitor for the ethanol production process.
Increased Rabi Season Area: The area dedicated to maize cultivation in the Rabi season has increased by 8.8% compared to last year, signaling a rise in production. States like Bihar and Bengal have seen improvements in sowing, and the crop condition is reported as satisfactory, contributing to expectations of a stable or soft maize price.
Price Trends: The price of maize in certain markets, such as Chhindwara Mandi in Madhya Pradesh, has softened to Rs 2200-2325 per quintal. Despite an increase in the Minimum Support Price (MSP) by 6.5% to Rs 2225 per quintal for the 2024-25 season, prices have seen a general decline of 3-5% in recent times. If demand remains weak, the price could drop further.
Domestic Supply and International Trends: The domestic supply remains relatively normal, with limited imports and a subdued export market. On the global scale, maize production has decreased in key maize-producing countries like the U.S. and Pakistan, while China and Russia have seen increased production. Brazil’s maize production is expected to improve, but the situation in Argentina remains uncertain.
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Source : Investing.com
