Corn prices may fall on record output

Mumbai, Sep 27 | Updated: Sep 28 2007, 05:45am hrs
Corn prices are likely to see a significant drop in the next 15 days due to record production and higher arrivals of the monsoon crop in major trading centres, traders and analysts said.

However, prices could rise by late October when export and domestic demand picks up, they said. Spot prices have been almost steady for the last one month, now a fall is expected, Mohanlal Vedant, a large trader in Nizamabad said.

Traders and analysts said prices could fall to Rs 600 a quintal levels up to October 15. Prices could start falling next week onwards and reach Rs 590 levels, Vedant said.

Spot corn prices in Nizamabad, a major trading centre in Andhra Pradesh, were trading at Rs 681.50 on Thursday, traders said.

India expects a record summer-sown corn production of 13.07 million tonne in 2007-08, up 14.3% from the previous year, according to the union agriculture ministrys first production estimates.

Andhra Pradesh has got a good production this year, but arrivals are delayed due to rain, said another large trader. Andhra Pradesh is a major producer of corn in India.

Traders and analysts expect arrivals to pick up from next week in major trading centres in Andhra Pradesh, Karnataka, Maharashtra and Bihar. They expect it to rise to 1,00,000 bags of 100 kg each per day from the present 10,000-15,000 bags.

Reuters