As autumn progresses, the millet market is undergoing a significant transformation, marked by a substantial increase in supply that is poised to drive prices lower by the end of October. Recent reports highlight an impressive 20-30% boost in millet availability this week, fueled by the arrival of new harvests and the release of previously stored inventory.
Supply Surge Impacts Market DynamicsAccording to the latest data from Dalian, the market has witnessed a notable surge in millet supplies, predominantly due to the influx of fresh grain from this year’s harvest and the reintroduction of stored products into the sales pipeline. This influx has created a situation where market supply has surpassed consumer demand, which has begun to weaken.
Analysts are attributing this supply boost to several factors, including favorable weather conditions during the growing season and increased cultivation efforts by farmers. As a result, the overall availability of millet in the market is set to rise further as producers work to meet the growing supply momentum.
Declining Demand Contributes to Price Pressure Compounding the issue of oversupply is a gradual decline in demand for millet as the month unfolds. Industry forecasts suggest that the overall usage of grain, including millet, is on track to decrease. Factors such as shifting dietary trends, changes in consumption patterns, and competition from other grains are contributing to this waning demand.
Buyers, feeling uncertain about future prices, are now showing reduced enthusiasm for purchasing millet, leading to a slowdown in transaction activity across the market. This dwindling demand, in conjunction with increasing supply, is creating an environment where prices are likely to decrease, with market participants preparing for negotiations that could lead to better deals.
Price Outlook: What to ExpectThe confluence of these factors suggests that millet prices may see a significant drop by the end of October. Experts indicate that as the month progresses, the gap between supply and demand could widen even more, providing buyers with greater leverage to negotiate lower prices. This could particularly benefit wholesale buyers and those looking to stock up for the winter months.
Current market pricing for Chinese hulled millet reflects these emerging trends. Conventional varieties are trading at approximately USD 1060-1100 per metric tonne, while organic millet prices are positioned higher, ranging from USD 1170-1200 per metric tonne. These figures are based on Free on Board (FOB) prices from Dalian, with a standard delivery timeframe of 25 days after contract finalization.
Industry Implications and Future Considerations :The ramifications of these market shifts could extend beyond immediate pricing. Farmers and suppliers may need to adjust their production strategies to align with changing demand dynamics, while retailers and distributors could face pressure to manage inventory levels effectively.Additionally, these trends may spur discussions within the agricultural community regarding sustainable farming practices and cultivation methods, as stakeholders strive to balance supply with market needs.
In conclusion, the next few weeks will be crucial for the millet market as increasing supplies and diminishing demand reshape price structures.
Source: Commodity Board