Animal-feed may halt operations as ‘corn hoarding’ sends prices soaring
Animal feed manufacturers have urged authorities to inspect grain wholesalers for signs of hoarding as they are unable to buy corn anywhere despite soaring prices, a news source revealed on Friday.
The price of animal-feed corn is at Bt13 per kilo, the highest in several decades, and about 30 per cent higher than the 2021 price of Bt10.05, said the source.
Manufacturers are prepared to pay that price but cannot find sellers with available stock anywhere. Farmers also told them that they had already sold their harvest to buyers earlier this year, the source added.
“Manufacturers now suspect that these buyers are hoarding corn and waiting for the price to go even higher due to the impact of the Russian-Ukraine war, which has driven up prices of several crops, including corn, wheat and tapioca,” said the source.
“The Commerce Ministry should inspect corn buyers’ stocks and take legal action against any merchants found to be profiteering while supplies of animal-feed raw materials remain at a critical level,” it added.
The government has set the floor price of corn at Bt8.5 per kilo as part of its price guarantee scheme for farmers. But it has not set a ceiling price, meaning the price of corn can soar and thereby increase costs for animal-feed manufacturers. However, the manufacturers cannot raise prices because animal feed is a controlled item.
“If the Russia-Ukraine war persists and the grain prices continue to rise, animal feed manufacturers may have to consider temporarily halting production to prevent losses,” said the source.