Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities

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

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

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Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities
News in brief
UP sugar industry stares at Rs. 3,000- cr loss
The sugar industry in Indias biggest- producing state, Uttar Pradesh, is staring at a loss of Rs. 3,000 crore this season (October- September), after the 16 per cent increase in sugarcane price announced on Friday evening. Stocks of sugar companies like Balrampur Chini and Triveni Engineering got crushed, even as the market ended flat. In the first year of its tenure, the Samajwadi Party- led state government increased the state advised price ( SAP) of sugarcane by Rs. 40 a quintal across varieties. The new price is Rs. 280 and Rs. 290 a quintal for normal and early varieties, respectively. In states like Tamil Nadu, Haryana and Punjab, where the system of SAP prevails, the price is much lower. Mills in Haryana and Punjab will pay Rs. 240 for sugarcane, while those in Tamil Nadu will pay only Rs. 225 a quintal, said S L Gupta, secretary of the UP Sugar Mills Association. Gupta said at the new cane price, the cost of sugar production would be Rs. 3,500- 3,600 per quintal, while the current realisation is ruling around Rs. 3,250. If sugar prices remain at these levels, the UP industry will incur a loss of Rs. 3,000 crore in the season on output of eight million tonnes, he noted. (Source: Business
Standard)

Market Highlights (% change)

Last Prev. day

as on Dec 10, 2012

WoW MoM YoY

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

19410 5909 54.36 85.56 1713

-0.07 0.03 0.02 -0.43 0.53

0.54 0.65 -0.77 -3.96 -0.38

2.99 2.96 -0.44 -0.59 -1.00

22.30 24.02 2.36 -14.56 3.20

.Source: Reuters

Cardamom loses aroma on arrival of old stocks

The cardamom market recovered at auctions in the last two days after easing during the middle of last week. The individual auction average dropped to below Rs 800 a kg on Thursday and Friday but picked up on Saturday and Sunday to Rs 817 and Rs 826 a kg respectively, trade sources said. Compared with the last season, prices are ruling at moderately higher levels and that is reflected on the faces of the growers, trade sources in Kumily said. They attributed the marginal decline in prices last week to the presence of 30 per cent of last years crop in the arrivals which has created apprehensions among the buyers about the stock of old crop held by farmers. Exporters were covering to meet their commitments and an estimated 30 tonnes of cardamom were bought by them. (Source: Business Line)

Demand for restoration of freight subsidy on wheat

Flour millers in southern states have petitioned the central government to restore the freight subsidy on wheat sold from Food Corporation of India ( FCI) godowns in nonproducing states. The subsidy was withdrawn last month, after millers in the producing states of Punjab, Haryana and Madhya Pradesh complained they were paying more ( thanks to local taxes) than their counterparts in purely consuming states. As a result of the withdrawal, says the Roller Flour Millers Association of India, theres been a rise of about Rs. 300 a quintal on wheat purchase in the southern states. Wheat can be bought in the open market from anywhere, but this is costlier than the price from FCI godowns. If buying from the latter, it has to be bought from the nearest godown in the state. Adi Narayan Gupta, president of the millers association, said the food ministry should allow the millers to purchase wheat from any FCI outlet in India. Vinod Bansal, vice- president of the Roller Flour Millers Association of Karnataka, said mills in the state had been operating at only 40- 50 per cent capacity since the revision. The railway freight from Ludhiana is close to Rs. 365 a quintal, which is exorbitant, he complained. (Source:
Business Line)

Dry season arrives in most Ivorian growing regions

Hot conditions and a lack of rainfall signalled the start of the dry season across most of Ivory Coast's main cocoa growing regions, farmers and analysts said on Monday. The dry season in the world's top cocoa producer typically runs from mid-November to March. But showers continued into early December on many plantations this year, providing a boost to crop development and ensuring a steady harvest into January, farmers said. Meanwhile, an analyst said the dry Harmattan winds, which blow south from the Sahara Desert from December to March, had arrived in the central areas of Ivory Coast, although they had yet to reach the cocoa regions. (Source: Reuters)

Brazil exporter sees coffee crop up despite offyear dip

Brazilian coffee exporter Terra Forte said on Monday it expected next year's 2013/14 crop to produce 53.4 million 60-kg bags of coffee, 2 percent more than its estimate for this year's crop despite a cyclical dip that would normally cut production. Coffee output in the world's top grower rises and then falls from one year to the next due to a biennial cycle of larger "on" and smaller "off" years. This year's 2012/13 crop came was an "on" year while next year's will come in an "off" year. Brazil's coffee crop, which is 75 percent arabica and 25 percent the cheaper robusta variety, is in the early stages of its development and will begin harvesting around May or June. Sao Paulo-based Terra Forte said the heart of Brazil's coffee belt in the south of Minas Gerais state would see output rise by 1.4 million bags or 11 percent from last year. (Source:
Reuters)

Coffee exports to S. Korea up five-fold

South Korea has become a key market in Far-East for Indian coffee exports. Indian coffee exports to South Korea have seen a five-fold jump in volume in the last three years, Jawaid Akhtar, Coffee Board Chairman, told Business Line. Exports to South Korea is expected to cross over 2,000 tonnes in crop year 2011-12 compared with 2,051 tonnes (in value terms Rs 33.87 crore) in 2010-11. In 2009-10, exports stood at 366.1 tonnes (Rs 3.51 crore). Korea is a market for mild coffee and India fits well due to its geographical advantage compared to South American coffee-growing countries. Aktar said: Korea is a good follow-up country for us. Exports have been steadily going up. It rose sharply ever since we took part in Seoul Cafe Show in Korea last year and this year. We want to cultivate and build this emerging market. As a step towards achieving it, we have been taking exporters along with us to showcase our diverse coffees, he said. (Source: Business Line)

Argentine soy, corn sowing slowed by driving rains

Key Argentine corn and soy areas have been drenched by storms this month, keeping some fields under water and delaying planting while toxic fungus, bred by the excessive moisture, moves in on wheat fields. The South American country is a major exporter of all three crops at a time of galloping prices fueled by high world food demand and thin supplies after disappointing harvests in breadbasket producers Russia, Australia and the United States. Satellite weather maps show Argentina's top grain province Buenos Aires has gotten up to 200 millimeters of rain since Dec. 1, turning prime corn and soy fields into unplantable mush.
(Source: Reuters)

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Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities
Chana
Chana spot as well as futures settled on a positive note on Monday on account of lower level buying. However, no major upside is expected on the back of higher imports of chana at comparatively cheaper rates. Total pulses acreage as on 7 December 2012 recovered significantly and stood at 116.11 lakh hectares, down marginally by 0.9% yoy. As on 30th November pulses acreage was down by 6.4 percent to 102.49 lakh ha. Chana sowing picked pace mainly in Rajasthan, where it is up by 1% at 14.21 lakh hectares compared to last week when acreage was down by 19.2%. In Maharashtra Chana acreage is up by 46% at 8.64 lakh ha as on th th 7 Dec, 2012. While in AP it is up by 18.36% at 5.8 lakh ha as on 5 Dec. In Australia, total chickpea production in 201213 is estimated to have increased to a record of around 746000 tones as compared with 485000 tones in 2011-12. India imports Chana mainly from Australia and Canada and higher availability in these countries at comparatively cheaper rates is seen boosting imports of Chana to meet the domestic shortfall. Australian Chana is quoted at lower rates -USD 625-635 per MT. The Commission for Agriculture Costs and Prices (CACP) has suggested 10 per cent import duty on pulses to encourage domestic production. in the first six months of the new fiscal that is from April to September this year, imports were an estimated 12 lakh tonnes.
Source: Telequote
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Market Highlights
Unit Rs/qtl Rs/qtl Last 4200 4157 Prev day 0.53 1.32

as on Dec 10, 2012 % change WoW MoM 1.70 -8.20 3.18 -9.32 YoY 30.05 32.68

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

Source: Reuters

Technical Chart - Chana

NCDEX Jan contract

Sowing progress and demand supply fundamentals

Improved rains towards the end of monsoon season coupled with hike in MSP have raised prospects of Chana sowing in the 2012-13 season. Also, farm ministry has targeted 7.9 mn tn chana output for 2012-13 season, higher compared to 7.58 mn tn in 2011-12. Except for Wheat, minimum support price of all other Rabi crops has been increased by CCEA for 2012-13 season. MSP of Chana/Gram is raised by Rs 400 per qtl for 2012-13 season to Rs 3200. Higher returns and favorable soil condition will definitely boost acreage in the coming season. According to the Ministry of Agriculture 99.81 Lakh hectare area has been planted under Kharif pulses in 2012-13 compared to 108.28 lakh hectare (ha) in the previous year. According to the first advance estimates of 2012-13 season, 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. 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)

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

valid for Dec 11, 2012 Resistance 4026-4055

3940-3980

Outlook
Chana January contract may extend the gains of the previous session and settle higher amid short coverings. However, upside may be capped on higher sowing prospects. Expectations of ease in supplies amid higher shipments coupled with subdued demand may keep prices under check.

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Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities
Sugar
Sugar spot continued to dwindle amid higher supplies in the domestic markets. However, futures extended the gains of Saturday and settled higher 0.3% on Monday on account of hike in cane price by the UP state government. The UP state government on Friday last week fixed the state advisory price (SAP) for early maturing variety of cane at Rs 290 per qtl against Rs 240 in the previous season, for common variety Rs 280 per qtl against Rs 245 and for late maturing variety, Rs 275 per qtl against Rs 240. The price is about 71 percent higher than the floor price fixed by the federal government at Rs 170/qtl. Government has allocated total 70 lac tons of non-levy sugar quota for Dec-March 2012-13 period which is higher from 59.5 lac tons last year. According to food ministry, Sugar production in the country is expected to decline to 23 million tonnes in 2012-13 due to delayed monsoon and drought situation in Maharashtra and Karnataka. Liffe white sugar as well as ICE sugar settled 1.84% and 2.34% lower on Monday on account of higher on forecast of higher sugar surplus for the fourth straight year.

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Dec '12 Futures Rs/qtl Last 3347

as on Dec 10, 2012 % Change Prev. day WoW -0.50 -2.17 MoM -3.21 YoY 9.17

Rs/qtl

3275

0.31

-0.15

-3.19

9.28

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 506 416.89

as on Dec 10, 2012 % Change Prev day WoW -1.84 -2.34 -3.32 -5.01 MoM -3.78 -0.42 YoY -16.54 -19.45

.Source: Reuters

Domestic Production and Exports

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. 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.

Technical Chart - Sugar

NCDEX Jan contract

Source: Telequote

Global Sugar Updates

Consultancy Kingsman revised up its 2012/13 world sugar surplus estimate to 9.2 million tonnes raw value on Friday, citing increased supply from producers including Brazil and China. Kingsman pegged global 2012/13 sugar output at 180.1 million tonnes raw value, up from the previous estimate of 177.3 million tonnes, and up from 2011/12 output of 175.4 million tonnes. (Source: Reuters) Brazil exported 2.3 mn tn raw sugar in November, down from 3.17 mln tn in October. Sugar output in brazil which was lower compared to last year since the beginning of the crushing season in May, is now up marginally by 0.1% at 29.3 mn tn. Thailand, the world's second-largest exporter after Brazil, has slashed its output forecast in the year to October 2013 to 9.4 million tonnes from 10 million due to poor rain. About 1 mn tn of cane have been crushed in Thailand as the harvest progresses, producing up to 56,000 tn of sugar so far, a 28% increase from the same year-ago period.

Technical Outlook
Contract Sugar Jan NCDEX Futures Unit Rs./qtl Support

valid for Dec 11, 2012 Resistance 3310-3320

3280-3290

Outlook
Sugar prices may trade on a positive note due to hike in the SAP. However, sharp gains may be capped as crushing in UP may start at full pace. Also, sufficient supplies along with subdued demand may cap sharp upside in the prices.

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Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities
Oilseeds
Soybean: Soybean extended the gains of the previous week and settled higher on Monday on account of robust demand for
soybean to meet soy meal export commitments coupled with dwindling supplies in the domestic markets. Total soybean arrivals declined to 2.80 lakh bags on Monday compared with 2.95 lakh bags on Saturday, while demand from solvent extractors also remained strong. According to first advance estimates, Soybean output is pegged at 126.2 lakh tn for 2012-13. Exports of soy meal rose to 517,103 tonnes in November from 397,659 tonnes a year ago. Overall oil meal exports in the first eight months of the year beginning April fell to 2.4 million tonnes from 3 million tonnes in the previous year.
Soybean Spot- NCDEX (Indore) Soybean- NCDEX Dec '12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Dec '12 Futures

Market Highlights
Unit Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3262 3269 728.1 719.4

as on Dec 10, 2012 % Change Prev day 0.68 1.41 -0.19 0.33 WoW 3.06 3.75 -0.76 -0.15 MoM -2.51 -0.29 4.66 5.40 YoY 43.83 43.99 12.84 11.37

Source: Reuters

International Markets
CBOT soybean settled marginally higher by 0.17% on Monday. USDA is scheduled to release its monthly demand supply report today evening and is expected to make slight downward revision in the Argentina and Brazil crop estimates. China, the world's largest soy buyer, imported 4.16 mn tn of soybeans in November, up 3.2% from October with crushing margins improving from a month ago . Imports for the first 11 months stood at 52.49 million tonnes, up 11.4 percent on the year. Growers advanced seedings by 11% points during the week 30 ended, covering 58% of the 19.4 mn ha expected to be sown this season. Although, the rate of planting picked up as the weather moderated after the Pampas was lashed by harsh August-October storms, it is still 8% below last years level.
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as on Dec 10, 2012 International Prices Soybean- CBOTJan'13 Futures Soybean Oil - CBOTDec'12 Futures Unit USc/ Bushel USc/lbs Last 1475 50.83 Prev day 0.17 0.02 WoW 1.44 1.86 MoM -1.63 4.22
Source: Reuters

YoY 32.62 3.61

Crude Palm Oil

as on Dec 10, 2012 % Change Prev day WoW 0.47 0.78 0.95 -1.64

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

Last 2121 413.7

MoM -6.97 -2.75

YoY -30.46 -19.03

MYR/Tonne Rs/10 kg

Refined Soy Oil: Ref soy oil as well as CPO recovered on Monday
as the Malaysian palm oil board data showed lower than expected high in palm oil stocks. Malaysia's November palm oil stocks rose 2.3 percent to a record high of 2,562,900 tonnes from a revised 2,505,713 tonnes in October. Exports of Malaysian palm oil products for Dec 1-10 rose 0.4 percent to 516,841 tonnes from 514,798 tonnes shipped during Nov 1-10. Dorab Mistry, head of edible oils trading, Godrej is predicting CPO futures on BMD to trade in a range of 2300 and 2600 from now until February 2013. This will ensure high stock levels in both countries but particularly in Malaysia. Prices may plunge further if India imposes a 10% import duty on CPO and a 20% import duty on Refined Palm products. Palm oil output in the world's biggest producer Indonesia is expected to climb 7% next year to 27 mn tn.

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Dec'12 Futures Rs/100 kgs Rs/100 kgs Last 4250 4120 Prev day -1.16 -0.39

as on Dec 10, 2012 WoW 0.59 -0.34 MoM -0.12 -1.72

Source: Reuters

YoY 36.71 29.15

Technical Chart Soybean

NCDEX Jan contract

Rape/mustard Seed: RM seed futures remained under downside

pressure amid higher planting area. The agriculture ministry data showed higher mustard seed planting figures of mustard seed. Mustard has been planted over 60.5 lh so far, against 59.6 lh a year ago. MSP for Mustard seed is increased to Rs 3000/qtl. Indias rapeseed output is expected to rise by 5% to 6.5 mn tn from 6 mn tn last year.

Outlook
Soybean complex may trade range bound during the intraday as market participant may adopt wait and watch policy ahead of USDA monthly crop report to be released in the evening. Slight downward revision in Argentina and Brazil crop estimates is expected in the report. Mustard seed prices may trade with negative bias on higher planting figures while. Palm oil may trade with a downward tinge on account of higher stocks.
Source: Telequote

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

valid for Dec 11, 2012 Support 700-706 3220-3260 4120-4150 412-414 Resistance 714-717 3340-3370 4210-4230 419-421

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Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities
Black Pepper
Pepper February Futures traded on a flat note yesterday. Prices have recovered from lower levels due to low stocks in the domestic markets. Also, winter demand is good at lower levels. Prices have corrected sharply over the last one month over reports that FMC is probing into complaints against movement in the pepper market. Better output expectations in the domestic as well as the international markets have also pressurized prices. Farmers are trying to liquidate their stocks ahead of the commencement of harvesting of the fresh crop. Exports demand for Indian pepper in the international markets is also weak due to price parity. However, festive as well as and winter demand has supported prices in the spot markets. The Spot settled 0.14% lower while the February Futures settled 0.09% higher on Monday. Pepper prices in the international market are being quoted at $7,700/tn(C&F), while Vietnam was offering Austa at $7,000/tn, Brazil Austa at $6,700/tn, and Indonesia Austa at $6,500/tn (FOB).

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Dec '12 Futures Rs/qtl Rs/qtl Last 38482 38835 % Change Prev day -0.14 -0.42

as on Dec 10, 2012 WoW 0.88 1.08 MoM -7.05 -7.45 YoY 10.07 9.10

Source: Reuters

Technical Chart Black Pepper

NCDEX Feb contract

Exports and Imports

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 pepper during Jan-Oct 2012 stood at 102,340 mt, lower by 12% as compared to 1,15,780 mt in the same period last year. Total exports in 2012 are forecasted at around 1,10,000 tonnes. 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 26% during January-September 2012 period to 41,923 tn as compared to 52,489 tn in the same period previous year. 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 Feb Futures Unit Rs/qtl

valid for Dec 11, 2012 Support 33700-33900 Resistance 34360-34580

Production and Arrivals

The arrivals in the spot market were reported at 25 tonnes while offtakes were reported at 15 tonnes on Monday. As per IPC, Global pepper production in 2012 is projected at 3.27 lk tn, up compared with 3.18 lk tn in 2011. Production for 2013 is projected at 316832 tn. Indonesian pepper output is expected to rise by 24% and in Vietnam by 10%. According to previous estimates, pepper output in Vietnam is estimated to be 1 lakh tonne in 2012 as compared to 1.1 lakh tonne in 2011. Brazil is also expected to produce 22,000 tn this year. 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) Pepper production in 2012-13 is expected around 60,000-63,000 tonnes. Currently, pepper is in the fruit formation stage in Kerala.

Outlook
Pepper is expected to trade on a sideways note with a positive bias in the February contract today. Festive demand coupled with winter buying may support prices at lower levels. However, higher output expectations as well as reports that FMC is probing into complaints against price movement may pressurize prices.

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Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities
Jeera
Jeera Futures traded in a rangebound manner yesterday as sluggish domestic demand pressurized prices while export demand supported prices. According to Gujarat State Agri Dept. sowing in Gujarat as on rd 3 Dec is reported at 2.219 lakh ha compared with 1.926 lakh ha in the same period last year. Higher stocks for delivery on the exchange warehouse have also pressurized prices. Exporters are buying due to tensions between Syria and Turkey as they are not offering. The spot settled 0.25% lower while March Futures settled 0.02% higher on Monday. According to markets sources about 75% exports target has already been achieved due to a supply crunch in the global markets. 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 $2,750 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 6-7 lakh bags compared with 5-6 lakh bags last year.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Dec '12 Futures Rs/qtl Rs/qtl Last 14880 14330 Prev day -0.25 0.47

as on Dec 10, 2012 % Change WoW 0.06 2.16 MoM -1.05 -2.05 YoY 5.29 5.01

Source: Reuters

Technical Chart Jeera

NCDEX March contract

Production, Arrivals and Exports

Unjha markets witnessed arrivals of 4,500 bags, while off-takes stood at 4,500 bags on Monday. Production of Jeera in 2011-12 is expected around 40 lakh bags as against 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 2.12 0.93

as on Dec 10, 2012 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Dec '12 Futures Rs/qtl Rs/qtl

Last 5155 5398

WoW 4.24 9.63

MoM 1.84 0.07

YoY -6.04 13.45

Outlook
Jeera futures may continue trade sideways with a positive bias due to good export demand at lower levels. However, h0igher stocks for delivery on the exchange warehouses coupled with improvement in sowing in Gujarat may cap sharp gains. In the medium term (December-January), prices are likely to stay firm as there are limited stocks with Syria and Turkey.

Technical Chart Turmeric

NCDEX April contract

Turmeric
Turmeric Futures continued to trade on a bullish note on yesterday as traders expect fresh orders from North India in the coming days. There are reports that many farmers have shifted to other crops. Expectations are that production may be lower by 40%. Production is expected around 65 lakh bags. Improved weather conditions in Andhra Pradesh and Karnataka has led to the revision in the production estimates. Stockists have good carryover stocks with them. It is estimated that next years carryover stocks would be around 10 lakh bags. There are reports that Turmeric Farmers Association of India have decided to fix their own MSP of Rs.10000/qtl, support prices at lower levels. The Spot as well as the Futures settled 2.12% and 4% higher on Monday. Production, Arrivals and Exports Arrivals in Erode and Nizamabad mandi stood at 1,200 bags and 3,000 bags respectively on Monday. Turmeric production in 2012-13 is expected around 64-65 lakh bags. Production in 2011-12 is projected at historical high of 10.62 lakh tn. 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. Outlook Turmeric prices are expected to trade on a positive note today as farmers may be unwilling to sell at lower levels. However, higher production estimates, higher carryover stocks and weak upcountry demand might cap sharp gains.

Source: Telequote

Technical Outlook
Unit Jeera NCDEX March Futures Turmeric NCDEX April Futures Rs/qtl Rs/qtl

Valid for Dec 11, 2012

Support 15000-15100 5970-6050 Resistance 15300-15390 6270-6350

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Commodities Daily Report

Tuesday| December 11, 2012

Agricultural Commodities
Kapas
NCDEX Kapas Futures that has shown some signs of recovery settled lower on Monday on account of profit booking. According to the data released by Cotton Corporation of India, 39.72 lakh bales of Cotton has been arrived as on December 02, 2012, down by 18.5 percent compared with the same period last year. The per day arrivals are reported around 1,40,000-1,50,000 bales. The government has procured 20.74 lakh quintals of cotton at the minimum support price (MSP) so far in the 2012-13. As per the DGFT notification dated 30 Nov 2012, the government has eased quantitative restrictions on exporters applying for permits to sell cotton in the overseas market and set the cap at 30,000 bales from 10,000 bales per exporter before. An exporter can apply for RC (registration certificate) for a maximum quantity of 30,000 bales (1 bale=170kg) or actual quantity exported in the previous cotton season, whichever is less. (DGFT) ICE Cotton futures settled 0.53% lower on Monday on account of profit booking.
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Market Highlights
Unit Rs/20 kgs Rs/Bale Last 988 16350

as on Dec 10, 2012 % Change Prev. day WoW -0.30 1.96 -0.43 0.25 MoM 1.91 0.25 YoY #N/A -1.80

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 73.4 81.35

as on Dec 10, 2012 % Change Prev day WoW -0.53 0.64 0.00 0.00 MoM 5.98 0.00 YoY -15.79 -29.20

Source: Reuters

Domestic Production and Consumption

According to Cotton Advisory Boards (CAB) latest estimates for 2012-13 season that commenced in October, domestic cotton production is pegged 334 lakh bales, down 5.6% from the previous years estimates of 353 lakh bales. Lower opening stocks coupled with estimated lower output will result in lower supplies this season at 374 lakh bales, a decline of 8.7% compared with last years 410.77 lakh bales. On the consumption front, domestic consumption is estimated higher at 270 lakh bales on the back of higher mill consumption. However, after witnessing record exports in 2011-12 season, Indian exports could witness significant fall this season on the back of lower availability along with unattractive domestic cotton prices. CAB estimates cotton exports at 70 lakh bales this season, compared with 128.8 lakh bales last year.

Technical Chart - Kapas

NCDEX April contract

Source: Telequote

Technical Chart - Cotton

MCX Dec contract

Global Cotton Updates

US weekly export sales showed net upland sales in the week to Nov. 29 jumped 38% to 415,700 running bales from the prior week, the highest since mid-June and the biggest for the current marketing year that started on Aug. 1. USDA is expected to release its monthly report and demand estimates is expected to increase for U.S. fibers due to higher-than-expected export sales for the first four months of the 2012/13 season. Cotton harvesting is 84% completed in US, versus 85% same period a year ago. Cotton crop condition is 43% in Good/Excellent state compared to 29% same period a year ago as on 20th Nov 2012. Brazils 2012-13 cotton production forecast at 6.3 million bales, down 27 percent from 2011/12 production now estimated at 8.6 million bales. (USDA Attach report)
Source: Telequote

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

valid for Dec 11, 2012 Support 969-980 16350-16450 Resistance 1000-1015 16650-16750

Outlook
Domestic cotton prices are expected to trade on a positive on account of lower arrivals in the domestic markets. Downside is expected to be limited in the domestic markets as farmers will not sell their stocks at very low prices. Also demand remains strong at such low prices.

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