The AFEX Commodities Index inched higher by 6.05% at the close of trading last week to settle at a season-high of 186.65 points. The rally in the ACI came on the back of increased processor demand in the maize and paddy rice markets.
Following weeks of processor absence in the maize markets, processors resumed inventory procurement as stocks have begun to deplete below maintenance thresholds, leading to a 6.92% spike in the price of maize in the week under review.
Converse to the established trend of a price reset in the commodities market during harvests, a combination of the impact of reduced imports of rice through the land borders, the imminence of the Eid-ul-Fitr celebrations, and the high influx of processor demands drove up prices astronomically. Season to date gains in the price of paddy rice rose to 30.44% at the end of last week to mark the highest price point so far in the season.
Activities in other commodities remain quite subtle with prices staying relatively flat.
We anticipate that the price of paddy rice, in particular, will witness a slight drop of about 5% – 7% over the coming weeks as the effect of the festive celebrations wear off and harvest from more producing locations come on board.
Agriculture Transporter’s Sentiments: “There are no restrictions on interstate travels for us because we transport food essentials. We are making more deliveries now that companies have resumed production. However, the cost of transportation is still the same as last week”
Below are the closing prices of the listed commodities
Soghum – 74,000 Maize – 10,000 Ginger – 522,667 Cocoa – 909,950 Paddy Rice – 131,000 Soybeans – 120,333