The Hindu Business Line : Centre may canalise maize exports

Easing pressure
A draft has been sent to the Department of Food and Civil Supplies
Plan to canalise maize exports comes on the heels of the pressure mounted by the user industries

M.R. Subramani

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Harish Damodaran Harish Damodaran

Chennai, June 24 The Centre is planning to canalise maize (corn) exports through one of the State-owned agencies as part of its efforts to curb exports and keep prices on leash.

“The draft was sent last week to the Department of Food and Civil Supplies. Something could emerge soon,” sources said.

The plan to canalise maize exports comes on the heels of the pressure mounted by the user industries such as the poultry and starch sectors. These sectors have demanded a ban on exports as maize exports have flared up of late. Since last week, the rise has been more pronounced after the areas under corn in the US Mid-West got flooded.

In view of the high prices from origins such as Brazil, Argentina besides the US, Indian maize has been in great demand, especially from South-East Asia and Far-East countries. Lower freight charges also work to India’s advantage.

“So far, 30 lakh tonnes of maize have been contracted for exports. Of this, 24 lakh tonnes have been shipped so far,” said Mr Amit Sachdev, Consultant of US Grains Council. “The point is, even if the Government bans maize exports, whatever has been shipped or contracted cannot be stopped,” he said.

Maize exports

Maize exports have been helped by a record 18.54 million tonnes (mt) production against 15.1 mt last year.

“Canalising or some curbs on exports will help to soften prices,” said Dr P. Selvaraj, National Egg Coordintion Committee’s Namakkal zone Chairman. “We, as user industry, have been asking the Centre to help us to get maize at reasonable prices. Definitely, production is more than requirement but exports have hit us. Instead of maize, we can export value-added products such as poultry meat or eggs,” he said. Mr Sachdev said the user industry was in for a tough time since it would require at least 35 lakh tonnes until early October, when the kharif crop could begin to arrive.

“We don’t know if there is so much of maize available in the country. Currently, if you ask for 500 tonnes, you get just 50 tonnes. The supply situation is bad,” he said.

“If the exports are canalised, we think we should be able to get some maize. We think of the 6 lakh tonnes that have to be shipped at least 2 lakh tonnes can be retained. If that is not done, our birds will starve,” Dr Selvaraj said.

Import of maize, allowed duty-free, is out of question since the landed cost could be around $400 a tonne. In contrast, Indian maize is being shipped at around $150 a tonne f.o.b. In the domestic market, maize is being quoted at Rs 8,300-8,500 a quintal in market yards. These go up to Rs 10,500 when it reaches the user industry’s gate.

Bajra

One alternative could be bajra. But its prices too have gained in line with maize.

“Even bajra costs have gone up,” said Dr Selvaraj.

“Bajra is available only in the North and some parts of Karnataka. In Maharashtra, you get low quality sorghum. Otherwise, there is little option,” said Mr Sachdev.

In the US markets, corn that was quoted at over $300 a tonne softened a bit on Monday and ruled at around $275.

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