Speaking to The Financial Express, SL Chopra, secretary, Indian Maize Development Association, said that a shortage had occurred because of crop failure in Uttar Pradesh. The state accounts for a major share in the total maize production in kharif season. "The shortfall is expected to be around 1.5 million tonne."

Unlike the present year, the last two years were witness to bumper crop production. Supply was so abundant that prices moved below the support price of Rs 3,600 per tonne. In stark contrast, maize prices prevailing in the Delhi market touched Rs 6,850 per tonne in March 1999. In May, corn prices touched a highof Rs 7,300 per tonne in Calcutta.

According to Chopra, had the Food Corporation of India (FCI) procured maize during bumper crop the industry would not have faced such extreme situations. "It is strange that though the government fixes support prices for maize, it does not make any purchases." Chopra believes that it should be the responsibility of the government to make purchases when the prices fall below the support prices fixed by the former. "Because of the government's refusal to interfere, it was the farmers who were at the receiving end earlier and now it is the turn of the industry."

One of the reasons why the government is not interested in procuring maize is the fact that the grain loses moisture when it is stored, resulting in a decrease in weight. Wheat on the other hand gains moisture as well as weight. Chopra feels that the excuse is poor as the government could provide drying facilities to farmers before making purchases.

The poultry sector has had to bear the brunt of the shortage asit does not have the resources to build a buffer stock. "Industries like starch and seed can afford to build a stock but not poultry farmers," said Chopra.

Maize import could improve the situation for the industry as landed price of imported corn estimated at Rs 4,400 per tonne was much less than the domestic prices. "The government would soon be making announcements regarding relaxation of import rules."

It is difficult to predict whether the rabi crop would improve the situation in the coming months as the seeds have not yet been sown. During the rabi season, maize is usually sowed in the months of June and July and harvested in September. Chopra feels that if pre-monsoon showers take place as per the schedule, the situation would be comfortable. However, if rains were heavy and a flood like situation takes place, the crop would be destroyed. The industry can now do little more than keep its fingers crossed and hope for a good rabi crop.