New Delhi: Maize futures are expected to go up by nearly Rs40 to touch the Rs1,000-per-quintal-mark in near term due to increasing demand for ethanol production and both food and feed industry, says a report.
“In near term prices of July contract are expected to trade on firm note at Rs1,000 per quintal level from last week’s Rs962 per quintal level, taking cues from firm spot market due to continued demand in the market,” said a Karvy Comtrade report on maize.
It added that, however, if acreage under maize cultivation would increase it may have an impact on the price movement. But, till then, the firm note for maize prices would continue.
Maize futures bounced back from the contract lows of Rs750 levels and was trading in positive direction in the market after the prolonged fall in recent times, the report said, adding, the prices broke the contract high at Rs915 level.
The downside movement was due to arrival pressure from rabi crop coupled with slowdown in demand from the feed industry, it said.
The other factors which supported the recent fall were scraping of import duty from 15% on limited quantity of 5 lakh tons, higher inflation rate above 7% and reports like ban on exports and futures trading in maize.
The fundamentals that would mainly support maize prices in the futures market are tight stocks in the physical market as the season has come to end, more than 200 % growth in exports at 15 lakh tonnes from September 2007 till May 2008, from 4.5 lakh tonnes in the previous year and the commodity becoming more popular as the feed and fuel crop.