India's Maize Conundrum: A Mix of Uncertainty and Opportunity

India's government is being urged by the US to allow the import of corn (maize) to meet the growing demand from the ethanol industry. However, this move may have a mixed impact on farmers and industries, particularly in the wake of farmers in Vidarbha beginning to shift to maize cultivation as an alternative to cotton and soybean. The demand for maize has led to a jump in prices, causing fears that imports may bring rates back to earlier levels, affecting farmers' earnings.

Key Takeaways:

• The ethanol industry has driven up maize prices in India, with prices reaching Rs2,300 to 2,500 per quintal in Vidarbha.
• Farmers in Vidarbha have begun to shift to maize cultivation, with the area under cultivation tripling in districts like Bhandara and Gadchiroli, reaching 17,000 hectares in two years.
• The US largely grows genetically modified (GM) maize, which is not allowed in India for human consumption, but may be allowed for use in the ethanol industry.
• Easing US imports by removing the 45% duty or reducing it can bring down maize rates in India, but may also affect the poultry industry as GM maize is not suitable for poultry feed.
• The poultry feed industry uses around 60% of maize, and around 22% goes for ethanol manufacturing.
• An hectare of farm yields 2 to 2.5 tons of maize, while soyabean output remains less than half of it.

Statistics:

• The area under maize cultivation in Vidarbha has tripled in two years, reaching 17,000 hectares.
• Maize prices in Vidarbha have touched Rs2,300 to 2,500 per quintal due to the ethanol factor.
• The landed price of US maize comes to a little over Rs1,700 a quintal in India.
• Close to 60% of maize is consumed by the poultry feed industry, and around 22% goes for ethanol manufacturing.

Sources:

• Times of India (no date)
• Government sources (no date)
• Trade sources (no date)
• Mahabeej Corporation (no date)
• Farmer, Radhesyam Sahu (no date)
• Timescontent.com (for Reprint Rights)