More quotes for int'l price index
The International Grains Council has revised its popular world-wide daily grains and oilseeds index by adding more price quotations.
The new quotations are from regions like Brazil, India and the Black Sea reflecting their increasing role in meeting world-wide food demand.
The changes come as rising food prices are a concern for most Asian governments and many are caught between tightening monetary policy to rein in inflation and keeping it loose enough to sustain growth.
To calculate the index IGC will now use cash-price quotations from 30 sources--up from 23 previously--to provide more extensive monitoring of food-price volatility, Darren Cooper, IGC's London-based senior economist told Dow Jones Newswires.
The change to the bellwether index is significant because markets and analysts use it to track food-price trends. Cues from producers often conflict because of world-wide economic uncertainty.
Among the new quotations IGC will be using are Black Sea milling wheat, corn and feed barley, Brazilian corn, Australian feed barley, India's 25% broken rice and Thailand's parboiled rice, Mr. Cooper said.
India emerged as the world's largest exporter of rice in 2012 soon after lifting a ban. Brazil is close to surpassing the U.S. as the world's largest exporter of soybeans and pipped Argentina as the second-largest corn exporter.
London-based IGC is an inter-governmental group for cooperation in grains trade. According to its latest forecast, world-wide grains production will fall 4% in 2012-13 aggregate year to 1.78 billion metric tons and will lag consumption by 45 million tons.
Analysts say this could mean continued volatility in prices as even a small supply disruption could tilt the balance in the market forcing market participants to take cover.
IGC's index stood at 296 points Monday--an 18% increase from a year earlier--owing to back-to-back droughts last year in the U.S. and South America.
IGC compiles export prices for eight individual commodities world-wide--wheat, corn, rice, barley, sorghum, soybeans, soymeal and rapeseed--to calculate the index, Mr. Cooper said.
Each commodity is assigned a weighting based on the five-year average of its world-wide traded volume. The weightings are reviewed in January, he said.
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(END) Dow Jones Newswires
January 23, 2013 02:26 ET (07:26 GMT)