MUMBAI, Jan 28 (Reuters) - Corn futures in India, Asia's
largest exporter, extended losses for a sixth straight session
on Monday, and are likely to fall further this week on rising
supplies in spot markets amid lacklustre demand from local feed
Traders said about a 2 percent rise in the rupee against the
dollar in the last two weeks amid softening global corn prices
dashed hopes of a likely recovery in export demand and weighed
on local prices.
"Earlier farmers were holding supplies expecting better
returns. As they didn't have capacity to hold long, now they
started bringing produce in large quantities," said Poonamchand
Gupta, a trader based in Nizamabad, a key spot market in Andhra
Daily corn supplies in spot markets across the country have
touched 8,000 bags of 100 kg each from less than 6,000 bags at
the beginning of this month, according to traders.
Shreedhar Reddy, another trader based in Davangere, in
Karnataka, said supplies were currently higher than when the
harvest was in full swing in October-November.
"More corn is arriving in spot markets now," Reddy said.
Softening prices of soymeal and rapeseed-oilcake, which can
be used as an alternative for preparing animal and poultry feed,
also put pressure on local corn prices, traders said.
Soymeal prices in the key Indore spot market have fallen by
45 rupees to 285 rupees per 100 kg in the last six days.
Lacklustre buying by feed makers, who are expecting a fall
in demand for poultry products with the end of the current
winter season, is also hurting sentiment.
Demand for poultry products in India usually rises during
the winter season as people eat more fatty foods than in the
high temperatures of the summer.
In Chicago, the key March corn contract on CBOT was
trading up 0.13 percent at $7.22 per bushel at 1237 GMT.
The contract fell about 1.5 percent in the previous seven
The key February contract on the National Commodity
and Derivatives Exchange (NCDEX) closed down 1.03 percent at
1,344 rupees (about $6.4 per bushel) per 100 kg.
The contract lost more than 5.5 percent in the previous six
Indian cottonseed oilcake, or kapashkhali, futures extended
losses for a second straight session to hit a new contract low,
and may fall further this week on rising cotton supplies in spot
markets and on softness in prices of other cattle feed products.
Kapashkhali is a by-product of cottonseed and is used as
cattle feed, mostly for dairy animals, in northern India.
Cotton supplies in the spot market, though rising, are still
7 percent lower at 13.4 million bales of 170 kg each as against
the comparable year-ago period.
Lower prices of rapeseed oilcake -- also used as cattle feed
-- due to an expected rise in production as farmers planted more
rapeseed, is also putting pressure on kapashkhali prices, said
Manjit Singh, a trader based in Ludhiana, Punjab.
The key February contract on the NCDEX ended down
0.92 percent at 1,297 rupees per 100 kg, after hitting 1,294
rupees -- a new contract low -- earlier in the day.
($1 = 53.6950 rupees)
(Reporting by Deepak Sharma; Editing by Anand Basu)