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Commodities Daily Report

Saturday| October 6, 2012

Agricultural Commodities

Content
News & Market Highlights Chana Sugar Oilseed Complex Spices Complex Kapas/Cotton

Research Team
Vedika Narvekar - Sr. Research Analyst vedika.narveker@angelbroking.com (022) 2921 2000 Extn. 6130 Anuj Choudhary - Research Associate anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132

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Commodities Daily Report


Saturday| October 6, 2012

Agricultural Commodities
News in brief
FCRA Bill will give farmers option to hedge against price fluctuations
Once Parliament gives its assent to the Forward Contracts (Regulation) Amendment Bill cleared by the Cabinet on Thursday, farmers ability to hedge the risk of price fluctuations in their produce will increase. This is because of option and derivative products being introduced as part of the change. Moreover, market participants say commodity exchanges would be able to offer trading in intangible products, such as weather derivatives, instead of the current practice of trading only in items that can be physically delivered. A weather derivative would allow farmers to hedge say, against a possible failure of monsoon. Significantly, the futures trade in farm commodities, stymied by periodic bans, could thrive as a result of the proposed changes. Former Forward Markets Commission (FMC) chairman BC Khatua, who had fiercely fought for greater autonomy for the regulator, said: The proposal in the Bill to give more powers to the FMC would ease the trust deficit among some stakeholders, who are otherwise interested in hedging risks, about potential regulatory arbitrage. The FMC would be able to generate its revenue through transaction fees and hire quality manpower and garner other resources to better regulate the market, Khatua added. Experts also say launches of greater products would expose the market to greater manipulative elements and tighter vigil by the FMC will be required to stem their presence. (Source: Financial Express)

Market Highlights (% change)


Last Prev. day

as on Oct 5, 2012
WoW MoM YoY

Sensex Nifty INR/$ Nymex Crude Oil - $/bbl Comex Gold - $/oz

18938 5747 51.9 89.88 1778.6

-0.63 -0.70 0.31 -2.00 -0.86

1.93 1.72 -1.93 -2.14 0.06

8.94 9.39 -6.54 -2.51 0.42

15.10 16.26 5.19 12.80 8.43

Source: Reuters

Two horticultural missions to be merged into one


n a bid to bring synergies between various programmes aiming at increasing production of horticultural crops, the government has decided to merge two centrally sponsored schemes Horticulture Mission for North East and Himalayan States (HMNEH) & National Bamboo Mission (NBM) with the ongoing National Horticultural Mission (NHM). Agriculture ministry official said the horticulture would get further boost if 240 million acre of cultivable wasteland is brought under orchard crops without curtailing the area under food crops. (Source: Financial Express)

N-E monsoon may set in after Oct 10


The India Meteorological Department (IMD) expects a low-pressure area to form over North Bay of Bengal during the next two days. Bounded by land on all three sides, the ocean base here might not give elbowroom for the low to intensify. A low intensifies depending on free space available to move about and feed in moisture. This is ruled out here, according to weather experts. The Bay is warming up under the influence of tropical storm Gaemi in South China Sea, which is expected to hit Vietnam by Sunday. The IMD said conditions are becoming favourable for monsoon withdrawal from Uttar Pradesh, more parts of Madhya Pradesh, Gujarat and Bihar by Monday. From here, the withdrawal is expected to take place fairly rapidly in view of the formation of the lows in both the Bay of Bengal and Arabian Sea. (Source: Business Line)

Withdrawal of Special Margin on Soya bean October 2012 contract


Bye-laws, Rules and Regulations of the Exchange, Special Margin of 20% (in cash) on the Long Side on Soya bean (SYMBOL: SYBEANIDR) October 2012 expiry contract will be withdrawn with effect from beginning of day Monday, October 08, 2012. (Source: NCDEX)

Bean scarcity, poor demand from Iran hurt soya exports


India's soyameal export fell further in September, to stand at its lowest level in two years, hit by scarcity of beans for crushing and a slide in demand from Iran, a leading trade body said on Friday. India, Asia's leading supplier of soyameal, exported just 6,525 tonnes of the animal feed in September, down 97% from a year earlier, industry body the Solvent Extractors' Association (SEA) of India said in a statement. High prices of soyabean seed resulted in less crushing and availability of soyabean meal for local as well as for export, BV Mehta, the bodys executive director, said. Iran, which has been the leading buyer for India's soyameal since April 1, bought just 554 tonnes against 31,750 tonnes a year ago, the data showed. It bought 4,218 tonnes in the previous month. Iran has made a large soya purchase deal with South America. (Source: Financial Express)

Russia to export up to 15 million tonnes of wheat in 2012-13


Russia, one of the world's key wheat exporters, will export up to 15 million tonnes of grain during the 2012/13 marketing year, almost half the volume shipped the previous year due to a poor harvest, the head of an influential lobby group said on Thursday. Russia has already exported 7.5 million tonnes of grain from the start of the marketing season, but the pace of exports will peter out from November, the head of Russia's Grain Union Arkady Zlochevsky told a press briefing. Russia's domestic grain prices rose to record levels but will stabilise starting from November thanks to sales from the government intervention stocks and low export demand, Zlochevsky said. Russia is likely to sell about 0.5 million tonnes of grain or 10 percent from the government's 5 million tonne intervention stocks, he added. (Source: Reuters)

TN sugar output tops estimate in 2011-12 season


Sugarcane crushing and sugar production have exceeded estimates in the 2011-12 season that concluded last month. According to official estimates, sugar production in Tamil Nadu was about 23.50 lh tns (lt) with over 252 lt of sugarcane crushed in the private, cooperative and public sector mills. Sugar recovery was 9.34%, slightly lower than the estimated 9.4%. The performance has exceeded early estimates pegged at about 220 lt sugarcane crushing to produce about 21 lh tn of sugar. Industry estimates peg sugar production for 2011-12 marginally higher at about 24 lh tns with some production happening in the fag end of the season. Sugarcane planting is around 6.80 lakh acres available for the current 2012-13 season. While the planting area has increased by about 15%, yield could drop due to the drought conditions in most of the areas. The industry estimates production in the current season could match that of 2011-12. According to official estimates, mills crushed 203 lt of sugarcane in 2010-11 to produce 18.46 lh tns of sugar. (Source: Business Line)

BJP farmer wing protest against wheat MSP freeze at R1,285


The Kisan Morcha (farmers' wing) of the Bharatiya Janata Party (BJP) on Friday took out a protest march here against the decision of the Commission for Agriculture Cost and Pricing (CACP) to freeze the minimum support price (MSP) of wheat for the forthcoming season at Rs. 1,285 a quintal. A large number of farmers from Punjab and Haryana joined the protest; some marched without shirts to symbolise the state of the economy. They later submitted memorandums to the governors of Punjab and Haryana. Addressing the protesters, BJP Kisan Morcha national president Om Prakash Dhankar said the Congress-led UPA government had "uprooted" the farmers. Dhankar told farmers that as per the data collected by the Kisan Morcha, the input cost of wheat is set to increase to Rs. 1,400 per quintal. (Source: Hindustan Times)

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Commodities Daily Report


Saturday| October 6, 2012

Agricultural Commodities
Chana
Chana spot as well as futures settled marginally lower by 0.31% on Friday ahead of profit booking after gaining for two straight sessions. Emergence of festive demand emerging coupled with low stocks in the domestic markets also supported the prices. CACP has recommended a hike in minimum support price (MSP) of gram by Rs.200 to Rs.3000 a quintal and Masoor by Rs.100 to Rs.2900 a quintal for upcoming 212-13 Rabi season to boost the production of pulses. As per the statement of Finance Minister P. Chidambaram, India has raised the subsidy on imported pulses to Rs. 20/kg from the earlier Rs. 10/kg, this move is expected to increase pulses imports. According to the first advance estimates, kharif pulses output is estimated lower by 14.6% at 5.26 million tonnes compared with 6.16 mn tn last year. Kharif pulses harvesting would commence from next month. As per the NCDEX circular dated 1 October, Special Margin of 10% (in cash) on the Long Side on all the running contracts and yet to be launched contracts in Chana have been withdrawn with effect from beginning of day Thursday, October 04, 2012. Prices declined last week on improved rains and reports of expected higher output in Australia, the largest supplier of chickpeas to India. In Australia, chana production rose by 70.5 percent to 8.27 lakh tonnes from 4.85 lakh tonnes in previous year.
Source: Telequote
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Market Highlights
Unit Rs/qtl Rs/qtl Last 4436 4523 Prev day -0.31 -0.31

as on Oct 5, 2012 % change WoW MoM 0.30 -8.31 2.19 -5.50 YoY 28.98 30.99

Chana Spot - NCDEX (Delhi) Chana- NCDEX Oct '12 Futures

Source: Reuters

Technical Chart - Chana

NCDEX Nov contract

Ongoing recovery in monsoon and above average rains in the past few days is showing better prospects for Rabi pulses sowing in the coming days. Monsoon has recovered across India, especially in Rajasthan, one of the major chana growing states, and may prove beneficial for the chana sowing.

Technical Outlook
Contract Chana Oct Futures Unit Rs./qtl Support

valid for Oct 6, 2012 Resistance 4370-4408

4250-4285

Sowing progress and demand supply fundamentals


According to the Ministry of Agriculture 99.81 Lakh hectare area has been planted under Kharif pulses as on 21th September, 2012 compared to 108.28 lakh hectare (ha) same period last year. According to the Fourth advance estimates, Pulses output is pegged at 17.21 mn tn in 2011-12 compared with 18.24 mn tn produced in the year 2010-11. While Chana output in 2011-12 is estimated at 7.58 million tones, Tur is estimated at 2.65 million tones, Urad is estimated at 1.83 million tones, Moong is estimated at 1.71 million tones. As per the latest release, Ministry of Commerce & Industry revealed that 20.23 lakh tones of peas, 2.03 lakh tons of Chana, 4.32 lakh tons of Urad & Moong, 1.12 lakh tons of Masoor and 4.26 lakh tons of Tur has been imported by India during April11-March 12. Assocham estimates, 21 mn tn of pulses demand in 2012-13 and is likely to reach at 21.42 mn tn in 2013-14 and 21.91 MT in 2014-15. (Source: Agriwatch)

Outlook
Chana futures are expected to trade on a positive note today due to emergence of fresh demand at lower levels and reduction in special margin on long side of chana. Estimated lower kharif pulses output may also support the upside in the prices during the intraday. In the medium term to long term, the trend remains positive on account of supply tightness. However, higher imports from Australia may cap the sharp upside in the prices.

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Commodities Daily Report


Saturday| October 6, 2012

Agricultural Commodities
Sugar
Sugar spot as well as futures closed 0.16% and 2.26% lower on reports of halt in sugar exports and increase in imports due to lower international prices. With the release of higher sugar quota for the next two months prices declined further during the intraday however, prices closed on a flat note on expectations of festive season demand. The Government has decided to make available a quantity of 40 lakh tons of non-levy quota, for the months of October and November 2012. Indian mills have signed deals to buy up to 450,000 tonnes of Brazilian raw sugar for delivery from October to December as a gap between domestic and overseas prices widens, making room for the first imports in more than two years, five dealers told Reuters. Millers based in western and southern India and global trading firms bought sugar at around $500/ton a CIF basis, as the price in the domestic market has jumped more than 23% to $680/ tn in the past three months. ICE raw sugar and life white sugar futures traded marginally lower and settled 0.12% and 0.28% lower on Friday.

Market Highlights
Unit Sugar Spot- NCDEX (Kolkata) Sugar M- NCDEX Oct '12 Futures Rs/qtl Last 3800

as on Oct 5, 2012 % Change Prev. day WoW -0.16 -0.65 MoM 2.70 YoY 22.58

Rs/qtl

3330

-2.26

-5.51

-3.45

21.00

Source: Reuters

International Prices
Unit Sugar No 5- LiffeOct'12 Futures Sugar No 11-ICE Oct '12 Futures $/tonne $/tonne Last 597.3 478.67

as on Oct 5, 2012 % Change Prev day WoW -0.12 -0.28 2.61 1.94 MoM 8.17 13.31 YoY -12.17 #N/A

Source: Reuters

Domestic Production and Exports


The area under sugarcane is estimated at 52.88 lakh ha for 2012-13 crop season, up from 50.99 lakh ha on same period a year ago. According to the first advance estimates by agriculture ministry, Sugarcane output is pegged at 335.3 mn tn, down by 6.2% compared to 357.6 mn tn last year. Despite of higher acreage, the producers body has estimated next years sugar output lower at 24 mn tn, down by 2mn tn compared to the current year. Sugar production in India the worlds second-biggest producer touched 26 million tonne since October 1, 2011. Industry body ISMA has estimated 6 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may export 2.5-3 mn tn sugar in 2012-13. With the opening stocks of 6 mn tn, domestic Sugar supplies are estimated at 30mn tn against the domestic consumption of around 22.523 mln tn for 2012-13. Thus, no curbs on exports are seen as of now.

Technical Chart - Sugar

NCDEX Nov contract

Source: Telequote

Technical Outlook
Contract Sugar Oct NCDEX Futures Unit Rs./qtl

valid for Oct 6, 2012 Support 3265-3290 Resistance 3335-3360

Global Sugar Updates


Brazilian cane mills produced 3 mn tn of sugar in the first half of August thanks to dry weather. Unica in its latest report stated said that total sugar output since the start of the crushing season is still down 12 percent from the same period a year ago. The International Sugar Organization said it expected a global sugar surplus of 5.86 million tonnes in the season running from October 2012 to September 2013, up from the prior season's surplus of 5.19 million tonnes. The ISO said the stocks/consumption ratio could rise to around 40 percent in 2012/13, from 37.6 percent in 2011/12. (Source: Reuters)

Outlook
Sugar prices may decline in the coming weeks amid higher sugar quota for the next two months and reports of raw sugar import after almost 2 years. However, a delay in crushing in Maharashtra by a month and lower cane output estimates may restrict sharp fall in the short term.

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Commodities Daily Report


Saturday| October 6, 2012

Agricultural Commodities
Oilseeds
Soybean: Soybean Futures as well as spot continued to trade on
bullish note for second straight session taking cues from the bullish international soy market. Also festive demand for edible oil supported the upside. The Futures settled on a 4% upper limit and spot settled 4.13% higher As per NCDEX, Special Margin of 20% (in cash) on the Long Side on Soya bean October 2012 expiry contract will be withdrawn with effect from beginning of day Monday, October 08, 2012. CBOT Futures recovered and settled higher by 1.29% on reports that China is buying Soybean from U.S. US soybeans are 41 pct harvested vs 22 pct week ago and 19 pct to nd 5-year average as on 2 October 2012. In Brazil planting has started 10 days earlier amid good rains. If rains continue in the coming weeks as forecast, Brazil could churn out 81 million tonnes of oilseed and replace the drought-stricken US as the world's top soybean producer, according to the USDA. Brazils grain Association expects the number 2 producers of soybean to produce record 81.3 mn tn in 2012-13. In the domestic markets, as on 20 September, 2012, Oilseeds have been sown in 174.39 lakh ha so far, compared with 178.16 lakh ha same period last year. Soybean area is higher at 106.9 lakh ha. According to first advance estimates, Soybean output is pegged at at 126.2 lk tn for 2012-13. However, drop in area under groundnut, sunflower & castor seed may lead to lower output of these oilseeds in 2012-13 which is estimated 9.6% lower at 187.8 lakh tn.
th

Market Highlights
% Change Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Oct '12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Oct'12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3027 3075 652 632.9 Prev day 4.13 4.01 0.39 1.70

as on Oct 5, 2012

WoW -9.48 -6.11 -11.30 -10.07

MoM -32.67 -17.99 -18.84 -20.06

YoY 35.74 37.86 1.76 1.19

Source: Reuters

as on Oct 5, 2012 International Prices Soybean- CBOTNov'12 Futures Soybean Oil - CBOTOct '12 Futures Unit USc/ Bushel USc/lbs Last 1551.5 50.76 Prev day 0.00 -0.47 WoW -3.09 -2.72 MoM -11.24 -11.51 YoY 12.47 -11.41

Source: Reuters

Crude Palm Oil

as on Oct 5, 2012 % Change Prev day WoW 2.70 4.00 -7.11 -9.67

Unit
CPO-Bursa Malaysia Oct '12 Contract CPO-MCX- Oct '12 Futures

Last 2248 411

MoM -23.54 -23.65

YoY -33.88 -13.56

MYR/Tonne Rs/10 kg

Refined Soy Oil: Ref soy oil settled 1.7% higher ahead of festive
demand and rise in prices in the international market. Although, exports are high the overall stocks of Malaysian palm oil are higher on the back of seasonally higher yield. Exports of Malaysian palm oil products for Sept. 1-25 rose 8 percent to 1,170,720 tonnes from 1,084,343 tonnes shipped during Aug. 1-25. Indias edible oil imports should rise 5.4 percent to a record 10.31 million tonnes in 2012/13, with the entire increase met by palm oil. India imported 112,611 tn of refined palm oil in July, down 9.28 percent from June. Total vegetable oil imports in July were 870,328 tn, up from 783,315 tn in the previous month (Source: Sea of India).

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Oct '12 Futures Rs/100 kgs Rs/100 kgs Last 4000 3847 Prev day -2.44 2.89

as on Oct 5, 2012 WoW -1.72 -4.06 MoM -5.38 -5.80


Source: Reuters

YoY 34.57 24.34

Technical Chart Soybean

NCDEX Nov contract

Rape/mustard Seed: Mustard futures traded on a positive note


yesterday and settled 2.89% higher taking cues from the bullish oilseed complex. Mustard output was lower in 2011-12. However, on the back of higher returns and improved rains, next years output is expected to be better. Sowing of rapeseed starts from October and northwestern Rajasthan is the top producing area in the country. As per NCDEX circular, existing Special Margin of 15% (in cash) on the Long side shall be reduced to 5% (in cash) on all the running contracts and yet to be launched contracts in Rapeseed Mustard Seed with effect from Monday, September 24, 2012. Outlook Edible oil complex is expected to trade sideways with a upper bias as taking cues from the international market. Also withdrawal of special margin in October soybean contract might provide support to the prices. However upside might be capped due to rise in soy output.

Source: Telequote

Technical Outlook
Contract Soy Oil Oct NCDEX Futures Soybean NCDEX Oct Futures RM Seed NCDEX Oct Futures CPO MCX Oct Futures Unit Rs./qtl Rs./qtl Rs./qtl Rs./qtl

valid for Oct 6, 2012 Support 603-610 3035-3060 3830-3865 400-406 Resistance 626-632 3140-3175 3945-3980 418-424.50

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Commodities Daily Report


Saturday| October 6, 2012

Agricultural Commodities
Black Pepper
Pepper traded sideways yesterday. Emergence of festive demand as well as low supplies in the domestic supported the prices. Farmers are unwilling to sell their stocks at lower levels. Reports that FMC has asked NCDEX to find out if there were any erratic trades in Pepper has pressurized prices. Traders are buying pepper directly from the farmers. Exports demand for Indian pepper in the international markets is said to be low due to huge price parity. The Spot as well as the November Futures settled marginally lower by 0.04% and 0.06% on Friday. th According to the circular released on June 13 2012 the existing Special margin of 10% (cash) on the long side stands withdrawn on all running contracts and yet to be launched contracts in Pepper from beginning of day Friday June 15, 2012. Pepper prices in the international market are being quoted at $8,600/tonne(C&F) while Indonesia Austa is quoted at $6,750/tonne (FOB). Vietnam was offering 550GL at $6,900/tonne. As per circular dt. 29/06/2012 issued by NCDEX, Hassan will be available as an additional delivery centre for all the yet to be launched contracts. (not applicable to the currently available contracts-till Dec 2012 expiry).

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Oct '12 Futures Rs/qtl Rs/qtl Last 42147 43190 % Change Prev day -0.04 -0.36

as on Oct 5, 2012 WoW -0.09 -0.76 MoM 1.79 2.69 YoY 21.63 24.43

Source: Reuters

Technical Chart Black Pepper

NCDEX Nov contract

Exports
According to Spices Board of India, exports of pepper in April 2012 fell by 47% and stood at 1,200 tonnes as compared to 2,266 tonnes in April 2011. India imported 1,848 tonnes of pepper till March 2012 and has become the third country to import such large quantity after UAE and Singapore. (Source: Agriwatch) According to Vietnam Ministry of Agriculture and Rural Development (MARD) exports of black pepper in 2012 are forecasted at around 1,25,000 tonnes. Exports of Pepper from Vietnam during January till June 2012 is estimated around 73000 mt 73,000 mt, higher by 4.3% in volume and 31.7% in value compared to corresponding year last year. Exports of Pepper from Brazil during January till May 2012 are estimated around 13369 mt. (Source: Peppertradeboard). Pepper imports by U.S. the largest consumer of the spice declined 14.8% in the first 2 months of the year (2012) to 8810 tn as compared to 10344 tn in the same period previous year. Imports of Pepper in the month of February declined by 16.8% to 3999 tn as compared to 4811 tn in the month of January 2012. Exports from Indonesia posted significant decrease of 42% as compared to previous year. Exports stood at 36,500 tonnes as compared to 62,599 tonnes in the last year. During May 2012 Brazil exported 1,705 tonnes of pepper as against 1600 tn in May 2011.

Source: Telequote

Technical Outlook
Contract Black Pepper NCDEX Oct Futures Unit Rs/qtl

valid for Oct 6, 2012 Support 42750-43000 Resistance 43550-43800

Production and Arrivals


The arrivals in the spot market were reported at 20 tonnes while offtakes were 20 tonnes on Friday. Global Pepper production in 2012 is expected to increase 7.2% to 3.20 lakh tonnes as compared to 2.98 lakh tonnes in 2011 with sharp rise of 24% in Indonesian pepper output and in Vietnam by 10%. According to latest report pepper output in Vietnam is estimated to be 1.35 lakh tonne as compared to 1.10 lakh tonne estimated early in the beginning of year (2012). Domestic consumption of Pepper in the world is expected to grow by 3.03% to 1.25 lakh tonnes while exports are likely to grow by 1.48% to 2.46 lakh tonnes in 2012. (Source: Pepper trade board) On the other hand production of pepper in India in 2011-12 is expected to decline further by 5% to 43 thousand tonnes as compared to 48 thousand tonnes in the last year. Production is lowest in a decade.

Outlook
Pepper is expected to trade on a positive note today due to low supplies in the domestic markets. Festive season buying is also expected support prices. However, reports that FMC has asked NCDEX to find out any irregularities in pepper trade may cap sharp upside.

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Commodities Daily Report


Saturday| October 6, 2012

Agricultural Commodities
Jeera
Jeera prices traded with a positive bias yesterday due to low arrivals in the domestic markets. Expectations of better export figures have also supported the prices at lower levels. However, reports of higher carryover stocks as compared to last year restricted sharp gains. Good rains in Gujarat, thereby expectations of better sowing prospects ahead of the rabi sowing have also pressurized the prices. The spot as well as the Futures settled 0.49% and 1.85% higher on Friday. According to markets sources about 75% exports target has already been achieved due to a supply crunch in the global markets. Around 10 lakh bags of Jeera are reported across India. Supply concerns from Syria and Turkey still exists. Expectations are that export orders may still be diverted to India from the international markets due to lack of supplies from Syria on back of the ongoing civil war. Production in Syria and Turkey is being reported around 17,000 tonnes and around 4,000-5,000 tonnes, lesser than expectations. Jeera prices of Indian origin are being offered in the international market at $2,600 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 7-8 lakh bags as compared to 4-5 lakh bags in the last year.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Oct'12 Futures Rs/qtl Rs/qtl Last 14537 13883 Prev day 0.49 1.85

as on Oct 5, 2012 % Change WoW 0.00 -0.18 MoM -2.47 1.50 YoY -2.84 -3.43

Source: Reuters

Technical Chart Jeera

NCDEX Nov contract

Production, Arrivals and Exports


Unjha markets witnessed arrivals of 4,000 bags, while off-takes stood at 4,000 bags on Friday. Production of Jeera in 2011-12 is expected to be around 40 lakh bags as compared to 29 lakh bags in 2010-11 (each bag weighs 55 kgs). (Source: spot market traders). According to Spices Board of India, exports of Jeera in April 2012 stood at 2,500 tonnes as compared to 2,369 tonnes in April 2011, an increase of 6%.

Source: Telequote

Market Highlights
Prev day -2.05 -2.21

as on Oct 5, 2012 % Change

Outlook
Jeera futures may trade on a positive note today. Prices may find support at lower levels on expectations of higher export figures. However, good rains in Gujarat and higher carryover stocks may cap any sharp gains. In the medium term (September-October 2012), prices are likely to witness a bounce back as there are limited stocks with Syria and Turkey.
Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Oct '12 Futures Rs/qtl Rs/qtl Last 5289 5388

WoW -4.47 -5.67

MoM -5.25 -11.67

YoY -7.53 9.96

Turmeric
Turmeric Futures traded on a negative note yesterday for the third consecutive day after reports that FMC asked NCDEX to find out if there are any erratic trades in Turmeric kept the prices under check. Higher stocks with the stockists also pressurized the prices. However, a reduction in the special cash margin on the long side supported the prices in the Futures at lower levels. Turmeric has been sown in 0.57 lakh hectares in A.P as on 03/10/2012. Sowing is also reported 30-35% lower during the sowing period. The Spot as well as the Futures settled 2.05% and 2.21% lower on Friday. Special Cash Margin of 40% on the Long side shall be reduced to 20% (cash) on all the running contracts and yet to be launched contracts in Turmeric w.e.f. beginning of day Wednesday, September 26, 2012.

Technical Chart Turmeric

NCDEX Nov contract

Production, Arrivals and Exports


Arrivals in Erode and Nizamabad mandi stood at 4,000 bags and 1,000 bags respectively on Friday. Turmeric production for the year 2011-12 is projected at historical high of 90 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 201011. Erode is expected to produce 55 lakh bags of turmeric a rise of 29% as compared to previous year. According to Spices Board of India, exports of Turmeric in April 2012 increased by 1% at 7,300 tn as compared to 7,230 tn in April 2011.
Source: Telequote

Technical Outlook
Unit Jeera NCDEX Oct Futures Turmeric NCDEX Oct Futures Rs/qtl Rs/qtl

valid for Oct 6, 2012 Support 13790-13940 5340-5410 Resistance 14250-14420 5520-5570

Outlook
Turmeric prices are expected to trade on a negative note today on reports that FMC has asked NCDEX to find out any erratic trades in turmeric. However, a reduction in the special cash margin, lower sowing figures and lower arrivals may support prices.

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Commodities Daily Report


Saturday| October 6, 2012

Agricultural Commodities
Kapas
Kapas futures settled 1.17% higher ahead of bargain buying along with short coverings. ICE cotton Futures closed lower by 0.85% on account of pick up in global harvesting in key countries. Cotton harvesting has commenced in US, in all 14% is harvested as compared to 10% a week ago, versus 15% same period a year ago. Cotton crop condition is 42% in Good/Excellent state as compared to 43% a week ago, and 29% same period a year ago.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 911 15810

as on Oct 5, 2012 % Change Prev. day WoW 1.17 -1.09 0.00 -2.53 MoM -8.99 -2.53 YoY #N/A -17.35

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

Domestic Production and Consumption


As on 21 September, 2012, Cotton is being planted on 114 lakh hectares, down, as compared to the last years 119.6 lakh hectares. However, the acreage so far is at par with its normal area of 111.8 lakh hectares. According to the First Advance Estimates, Cotton production for 2011-12 seasons is revised upward to 334 lakh bales compared with 352 lakh bales estimated earlier. Also, on account of cheaper cotton available in the global markets, imports have more than double from 5 lakh bales to 12 lakh bales. On the demand front, exports increased to around 127 lakh bales from the earlier estimates of 115 lakh bales taking total cotton consumption to around 382 lakh bales. Thus, the ending stocks figure for 2011-12 season, that would end in September, has been revised upward to 28 lakh bales from the previous estimates of 25 lakh bales. In its September monthly demand supply report on Wednesday, the Agriculture Department (USDA) raised its estimate for the global cotton surplus by next July to a record of 76.5 million 480-pound bales, nearly a two-million bale increase from last month's estimate.
st

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 69.8 81.35

as on Oct 5, 2012 % Change Prev day WoW -0.85 0.13 0.00 0.00 MoM -6.80 0.00 YoY -32.46 -29.20

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Global Cotton Updates


Global cotton prices are mainly influenced by China, US and India. USDA estimated US Cotton planting for the season 2012-13 at 12.64 mln acres as compared to 14.74 mln acres last season (2011-12). Ending stocks were at 4.8 mln bales (480 pounds/bales) with Production of 17.65 mln bales and exports of 12.1 mln bales were pegged for the season 2012-13. China's 2012 cotton output is estimated at 6.97 million tns, down 4.2 percent from last year. China's cotton imports in August rose 48 percent on the year to 305,600 tns. Total imports in the first eight months of the year were 3.77 million tns, up 123% from the same period last year, according to the report by the China National Cotton Reserves Corp.
Source: Telequote

Technical Chart - Cotton

MCX Oct contract

Outlook
Kapas futures in intraday is expected to trade sideways as ongoing harvesting in the key states coupled with new cotton crop arrivals from the northern states might pressurize the prices. However, prices in spot market are nearing its MSP, which would restrict any major fall. Also Farm Minister has lowered the output estimates of cotton for the 2012-13 season, that will provide support to the prices in the short term. However, in the international front, cotton harvesting has begun globally which might cap a sharp upside in medium term.

Source: Telequote

Technical Outlook
Contract Kapas NCDEX April Kapas MCX April Cotton MCX October Unit Rs/20 kgs Rs/20 kgs Rs/bale

valid for Oct 6, 2012 Support 885-900 883-899 15550-15670 Resistance 925-935 923-932 15960-16050

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