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General Characteristics
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- Maize (Corn), is of
American origin, and after wheat and rice, it is the most important
cereal grain in the world.
- It provides nutrition
to both humans (33.3%) and animals (66.6 %).
- Serves as basic raw
material for the production of starch, oil and protein, alcoholic
beverages, food sweeteners and more recently fuel.
- Special crops grown
primarily for food include sweet corn and popcorn, although dent,
starchy or floury and flint maize are also widely used as food. Flint
maize is also used as feed. Immature ordinary corn on the cob either
boiled or roasted is widely consumed.
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Global Scenario
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- World corn production
in the year 2003 was 614.3 million tons while in year 2004 total world
corn production is expected to be 642.6 million tons.
- Major producing
countries are United States, China, EU-25, Brazil, Mexico, Argentina and
India. These countries accounts for around 80 % of total world corn
production.
- Major consuming
nations of corn are China and USA.
- There has been
continuous increase in the consumption demand of corn mainly owing to
increase in the demand from meat and starch sector. There is growing
requirement of maize from poultry sector, which uses corn as feed.
- Major importing
nations of maize are Japan, Korea, Taiwan, Mexico, Egypt, Malaysia, EU
and Colombia.
- Among the major
exporters of corn, USA stands first followed by Argentina and Brazil.
China, South Africa, Ukraine are minor exporters, their share is very
low. Only USA dominates the international trade of corn as an exporter.
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Indian Scenario
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- India's maize
production fluctuates between 10-14 million tons, with 80-90% of the
production being in the kharif season.
- Major states that
contribute in Maize productions are Karnataka, Andhra Pradesh, Bihar,
Punjab, Uttar Pradesh and Madhya Pradesh.
- Around 6.5 million
tons (roughly 50 % of total consumption) goes for feed use, primarily
for poultry feed. Another 1 million tons of corn is used by the starch
industry.
- India is traditionally
a maize importer, and Govt. permits a fixed quantity (determined each
year) to be imported at 15%. Extra has to be imported at 50%.
- However, in 2003-04,
India exported around 3-5 lakh tons of maize, mainly to Southeast Asian
countries.
- Rising household
incomes have shifted human consumption from maize to other cereals like
rice and wheat. The rising incomes have also led to an increased
consumption of meat, particularly of poultry, which has increased the
demand for maize as feed.
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Factors that Affects Rice/Wheat/Maize Prices
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- Role of weather in
crop production is immense. Temperature, rainfall and soil moisture are
the important parameters that determine the crop condition. Further,
natural calamities like typhoon, floods, droughts and earthquake can
also affect crops. Markets keep watch of these developments.
- Changes in the minimum
support prices (MSP) by the government also have immense impact on the
prices of the commodity.
- Availability of
substitute products at cheaper rate may lead to weakness in demand. This
situation happens especially when the main products price tends to
become higher. For e.g., jowar/ bajra may be preferred by poultry feed
manufacturers instead of maize, if its prices are high.
- Seasonal cycles are
present in agriculture crops, particularly in short duration annual
crops. Price tends to be lower as harvesting progresses and produce
starts coming into the market. At the time of sowing and before
harvesting price tends to rise in view of tight supply situation.
- Breakthrough in the
technology may increase the productivity and would lead to more supply.
This may bring some softness in the price.
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