The latest world events due to the drought that hit Brazil in 2020, the high demand from China with the future purchase of much of the grain production, especially yellow maize produced in the United States and the most recent impact on world trade due to the coronavirus pandemic Covid-19, maintains an upward trend in the prices of the raw materials of this and other essential grains for human consumption.
In its most recent report on the food price index (IPA / FAO), the Food and Agriculture Organization of the United Nations (FAO) warns of a 42.3% increase in the price of corn above January 2020 levels. for the FAO, are estimated in the price of wheat at 6.8%. It also estimates that the same will happen in rice, in addition to a 2.2% contraction in world cereal reserves, which amounts to 801 million tons. “level in seven years.”
However, in the country there is a sufficient reserve of rice and the production of corn, although near nil, the Dominican transculture, influenced by North American culture, changed the consumption pattern of white corn and therefore the yellow corn used as input for Production Livestock are the costs that will be seen in the final prices of food products such as chicken, eggs, beef and pork.
Wheat affects flour, pasta and bread. From now on, campaigns will have to be launched to change the pattern of consumption towards food and other products of the earth that can ease the price increases in the world market. In addition, resuming the joint planting of tobacco and tomatoes with, for example, maize, as did the aborigines, a mechanism that, according to expert in agricultural research Manuel González Tejera (Manegonte), is perfectly feasible.
González Tejera confirms that prices will continue to rise “and that is not due to scarcity or speculation, but to demand from China.” The price of maize is affected by the uncertainty in the US, but it means that, although it is more expensive than half a year ago, it will never increase like in 2007/2008. Food was up 113.3 points in January from December and grains 124 points. The increases are in sugar, grains, vegetable and dairy oils and fats.
Program
The program announced by the Minister of Agriculture, Limbert Cruz, to ensure zero-rate sorghum and maize production, and the purchase of 100% of these goods, as well as stability in tomato production, is expected to contribute to improve the local situation.
In the country, maize production is minimal because there are no large acres of land for cultivation like Brazil, Argentina or Central America, countries that not only focus on white maize for human consumption, but also grow yellow maize for inputs. . Another country that has taken measures to contain the price increase is Russia, by increasing tariffs on some grains such as wheat and avoiding flight to other markets. A Reuters report dated 2 this month says that Mexico will cut its imports of corn, especially corn used for livestock. Brazil will apply tariffs to its imports outside of Mercorsur, corn and soybeans. Outside the block (which includes Argentina, Uruguay and Paraguay), the tariff that Brazil applies to imports of cereals is 8%.
In fact, almost all international input price reports reveal the upward trend in the grain markets, mainly attributed to the strong demand for corn, soybeans and others, especially from China, a situation hitting grains, sugar and edible fats, having a major impact in this area . country.
Sugar rose 8%, vegetable oil 5.8%, dairy 1.6% and there is also an increase in meat. The FAO indicates in its index (IPA / FAO) that there will be record harvests of some products, which will also be affected by China.
The price of maize rose 11.2%, 42.3% more than a year ago. From US $ 3.79 in 2018, a bushel of corn (grain measurement unit) is estimated at US $ 5.24 for delivery through March of this year 2021.
The United States has also reduced production. According to the USDA’s Department of Agriculture, the world corn crop, estimated at 1,144 million tons (MT) in December 2020, will be cut by 1 million tons less than last year.
KNOWING MORE
The largest producers
EE.UU.
The United States (32%), China (23%) and Brazil (10%) are the largest maize producers, accounting for 66% of the world’s grain production.
Price per ton
The price per ton of corn was worth $ 202.9 in January 2020 and $ 209.4 now in February 2021, according to the Chicago Stock Exchange.