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Commodities Daily Report

Tuesday| October 23, 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


Tuesday| October 23, 2012

Agricultural Commodities
News in brief
Agri production to grow 1.5% this year, says Abhijit Sen
Despite advance estimates of the khariff output showing a decline this year in value terms, agriculture production would post a positive growth of 1-1.5 per cent this year, said Abhijit Sen, member of the Planning Commission. I am hopeful that the rabi and livestock sectors will take a rebound this time. So, at the end of the day, it will be positive, said Sen. He cautioned that the prices of coarse cereals, which are mainly used as livestock feed, would shoot up if the government does not act quickly by releasing more food grain stocks into the market. Any failure to act quickly would impact the prices of milk and livestock products, which have so far remained stable, he said. There is no reason for the prices of rice and wheat to go up but the ongoing exports are building pressure on these prices as well. On inflation, Sen said that the general direction is down from eight per cent level, although it would remain high in the next couple of months as the full effect of recent pass through of oil prices will be seen. Responding to a question on distress conditions reported in some part of the country, Sen said that farmers are ending up in debt by growing risky cash crops is one reason behind the distress condition.
(Source: Business Standard)

Market Highlights (% change)


Last Prev. day

as on Oct 22, 2012


WoW MoM YoY

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

18793 5717 53.56 88.73 1725

0.59 0.58 -0.53 -1.47 0.13

0.43 0.53 1.09 -3.40 -0.63

1.61 2.09 -0.64 -6.88 -2.45

12.21 13.49 8.65 0.44 4.44

Source: Reuters

Private mills oppose raw, white sugar imports


In view of surplus stocks, the Indian Sugar Mills Association (ISMA), the apex body of private mills in the country, has opposed the import of raw or white sugar this year. Further, the industry body has demanded that import duty on raws and whites be increased to 25 per cent from 10 per cent at present. In a letter to the Prime Ministers Office, the Commerce and Food Ministries, ISMA said that current stocks and estimated production in the 2012-13 season would be sufficient to meet the domestic requirement and there was no need for imports. ISMAs opposition to imports comes at a time when mills in the South, mainly Maharashtra, are demanding duty-free import of raw sugar to tide over the cane shortage. Food Minister K.V. Thomas last week hinted at the possibility of a revision in duty on both raw and white sugar imports in a couple of weeks. The industry body said that the landed cost of imported sugar was almost comparable to the domestic sweetener. The import duty of 10 per cent is still holding back unnecessary imports into the country. (Source: Business Line)

Stop trials of GM crops, say farmers unions


Several farmers leaders in Andhra Pradesh have asked the State Government not to allow GM (genetically modified) crop trials. Representatives of an all-party farmer unions have met Agriculture Minister Kanna Lakshminarayana on Sunday evening and requested him not to give permission for the GM field trials in the State. You should consider giving permission only after a holistic study, the farmers leaders had said. They also asked the Minister not to give permission for GM trials at all in food crops. The Minister assured them that the Government would take a decision only after discussing the issue with all stakeholders, an official of the Agriculture Ministry said. Meanwhile, the Government had decided to go for a probe into the reported incidence of sucking pest attack on Bt cotton crop in some parts of the State. The Agriculture Minister had issued fresh instructions to the officials of Department of Agriculture to order a thorough investigation into the reports. (Source: Business Line)

Wheat Harvest in Australia Seen Falling 28% to Five-Year Low


Wheat production in Australia, the worlds second-biggest shipper, will probably decline 28 percent to the lowest level in five years, missing a government estimate, after dry weather reduced yields. The harvest (ALHVS) will total 21.2 million metric tons in the 2012-2013 marketing year, according to the median of estimates from four analysts and two traders compiled by Bloomberg. That compares with 23.25 million tons in a survey last month and an official forecast of 22.5 million tons. The crop was a record 29.5 million tons last year. Wheat climbed 34 percent this year as dry weather in parts of the European Union and Russia cut global stockpiles to the lowest in four years, helping boost food costs 7.7 percent the past three months. The U.S. Department of Agriculture cut its estimate for Australian output 12 percent to 23 million tons on Oct. 11. That may be lowered by 2 million tons in coming reports because of dry conditions, said Rabobank International. (Source: bloomberg)

Spices Board cuts bidding rate for cardamom sale to Rs 2


Spices Board has decided to resume cardamom auction from October 24. It has directed the auctioneers to conduct auctions on the day fixed for each of them. A statement issued by the Board said that the cardamom auctions were being resumed following the directions from the Kerala High Court to resolve the stalemate in auctions. The Spices Board has notified a lower bidding rate of Rs 2 against Rs 5 fixed earlier. There will be no auction on October 23, a notified holiday for the cardamom auction centers on account of Ayudha Pooja. The stock pooled for auction on September 25 that saw a boycott by the traders in protest against the higher bidding rate, would be allowed as a special case, to be auctioned on Wednesday afternoon. To meet the demand, trading was taking place in the open market in Bodinayakannur where 30 per cent of the normal volume was being handled, Mr Ranganathan, a dealer, told.
(Source: Business Line)

U.S. corn harvest 87 pct done, soybeans 80 pct - RTRS


U.S. corn harvest was a record 87% complete and farmers had finished 80% of soybean harvest as of Sunday, according to a U.S. Agriculture Department report issued on Monday, but the tail end of their combining efforts was expected to be slow due to rain. Analysts had been expecting the corn harvest to be 89% finished and soybean harvest 82% complete, according to the average of estimates in a Reuters survey of 13 crop watchers. Occasional showers over the next week to 10 days will cause minor delays in harvesting the remaining U.S. corn and soybean crops, said John Dee, meteorologist for Global Weather Monitoring. Farmers were in no rush to finish up their harvest tasks as few faced pressure to deliver crops straight from the fields to elevators and processors. Most growers had already booked enough sales to satisfy their immediate cash needs. A year ago at this time, soybean harvest was 77% finished and corn harvest was 60% complete. The five-year averages for late October are 69% for soybeans and 49 percent for corn. (Source: Reuters)

Storm seen heading for landfall in A.P.


The IMD has joined the outlook for intensification of the system in the Bay and its further movement in the west-north-west direction. A few global models expect it to become a storm and head for a landfall over the east coast, although they differ on the choice of the likely target for a specific spot. The US National Centres for Environmental Prediction suggests the Andhra Pradesh coast as the likely landfall spot. The European Centre for Medium-Range Weather Forecasts was less optimistic and suggested that the system could weaken as it approached the Tamil Nadu coast. (Source: Business Line)

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Commodities Daily Report


Tuesday| October 23, 2012

Agricultural Commodities
Chana
Chana November declined further on Monday on prospects of better sowing and reports of higher shipments from Australia and Canada in the coming weeks Chana sowing has started in some parts of Maharashtra, AP and Karnataka and is expected to commence soon in MP and Rajasthan too. In Maharashtra, 97000 ha area has been covered so far which is only 7.1% of the targeted 12.32 lakh ha by the state dept. In AP, chana acreage stood at 41000 hectares as on 17 October, 2012 compared with 98000 hectares during the same period last year. Prices have gained considerable since the beginning of October amid festive season buying and lower supplies caused by lower output in 2011-12 season. 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 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. Good rains in the month of August and September has raise prospects of 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.
st th

Market Highlights
Unit Rs/qtl Rs/qtl Last 4589 4661 Prev day -1.30 -1.40

as on Oct 22, 2012 % change WoW MoM -3.61 2.79 -4.92 4.81 YoY 33.03 37.98

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

Source: Reuters

Technical Chart - Chana

NCDEX Nov contract

Source: Telequote

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 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. According to the Fourth advance estimates of 2011-12 season, 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. 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 Oct Futures Unit Rs./qtl Support

valid for Oct 23 2012 Resistance 4690-4730

4605-4635

Outlook
Chana futures mat remain firm in the current week on account of festive season demand and tight supplies. However, reports of higher sowing of Rabi pulses this season might pressurize the prices in the medium term. Although short term trend remain positive for chana, we expect prices to come under downside pressure in the month of November as supply pressure may ease amid shipments from Australia and Canada.

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Commodities Daily Report


Tuesday| October 23, 2012

Agricultural Commodities
Sugar
Sugar November futures settled marginally lower on Monday on account of adequate supplies to meet the festive season demand. Further, food ministry is keeping a close watch on sugar sales by millers in the open market and warned against failure to sell the entire quota allocated to them for the October-November period, which lead to selling pressure. India, which is likely to produce a sugar surplus for its third year in a row, has decided to allow exports for another year, Food Minster K.V. Thomas said, reflecting confidence about domestic supplies in the world's top consumer of the sweetener. Mills and traders will have to wait for a formal order to export sugar in the new season that began on Oct. 1. 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. Liffe white sugar settled 0.4% higher due to short coverings, while ICE raw sugar closed 0.84% lower on Monday. Prices have corrected over the last couple of days due to good supplies from Brazil. Higher output and lower imports expectations for the 2012-13 season from China coupled with weak international markets is keeping prices under downside pressure.

Market Highlights
Unit Sugar Spot- NCDEX (Kolkata) Sugar M- NCDEX Nov '12 Futures Rs/qtl Last 3750

as on Oct 22, 2012 % Change Prev. day WoW 0.00 -0.32 MoM -2.60 YoY 16.94

Rs/qtl

3290

-0.51

-5.02

-7.35

10.48

Source: Reuters

International Prices
Unit Sugar No 5- LiffeDec'12 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 550.1 445.78

as on Oct 22, 2012 % Change Prev day WoW 0.40 -0.84 -1.40 -0.55 MoM -1.24 4.42 YoY -24.49 -25.54

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 Support

valid for Oct 23, 2012 Resistance 3308-3325

Global Sugar Updates


Sugarcane harvesting in Brazil was down 7.9% as on 1st October 2012 at 24 mn tn. Unica expects the main center-south cane to yield 32.7 mn tn sugar output in 2012-13, down 1.2 % from the 33.1 mn tn forecast in April. Favorable weather in the second half of September should allow harvest and exports to run on schedule despite a couple of days of rain last week that slowed crushing. Thus sharp upside in the international prices may be capped. 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)

3260-3275

Outlook
Sugar prices may remain under downside pressure as higher quota is seen offsetting festive season demand. Approval to unrestricted exports may benefit India only if the global sugar prices gain considerably. However, supply pressure from Brazil is keeping international sugar markets under downside pressure.

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Commodities Daily Report


Tuesday| October 23, 2012

Agricultural Commodities
Oilseeds
Soybean: Soybean futures traded on a positive due to bargain
buying at lower levels. Reports of improved soy meal exports demand along with festive season demand for edible oil supported the prices. Also, farmers were not ready to sell their stocks at lower levels. The Spot as well as the Futures settled 1.5% 4.43% higher wo-w. New soybean arrivals at MP stood at 450000 bags, Maharashtra170000 bags and Rajasthan 100000 bags on Wednesday. Arrivals are expected to improve to 6-6.5 lakh bags in MP in the coming weeks. According to first advance estimates, Soybean output is pegged 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. CBOT Soybean settled higher by 0.80% as reports of farmers holding back their stocks as a reason for firming up the prices supported the upside. According to the latest crop progress report released by USDA, as on 23 Oct 2012, US soybean harvest is 80 per cent complete as compared to 71 per cent last week and 69 per cent compared to 5 year average. According to the USDA October monthly report, Global soybean production is projected at 264.3 million tons, up 6.2 million mostly due to an increase for the United States. Ending stocks are seen down from 169 million bushels in 2011-12 to 115 million bushels in 2012-13 season. 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.

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Nov '12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Nov '12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3270 3322 696.3 690.3

as on Oct 22, 2012 % Change Prev day 0.96 0.38 1.24 1.70 WoW 4.44 6.03 4.42 4.25 MoM -5.63 -2.41 -7.11 -3.74 YoY 50.55 52.01 11.77 11.17

Source: Reuters

as on Oct 22, 2012 International Prices Soybean- CBOTNov'12 Futures Soybean Oil - CBOTDec'12 Futures Unit USc/ Bushel USc/lbs Last 1547 51.66 Prev day 0.80 0.16 WoW 3.62 3.30 MoM -4.64 -5.12
Source: Reuters

YoY 27.57 0.80

Crude Palm Oil

as on Oct 22, 2012 % Change Prev day WoW 2.70 2.62 2.88 4.24

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

Last 2469 435.1

MoM -7.70 -7.01

YoY -13.67 -11.60

MYR/Tonne Rs/10 kg

Refined Soy Oil: Ref soy oil as well as MCX CPO traded on a
positive note on Monday due to festive season demand for the oil along with higher exports of Malaysian palm oil during 1-20 October. Ref soy oil as well as MCX CPO (Nov) settled 1.6% and 2.45% higher respectively w-o-w. Exports of Malaysian palm oil products for Oct. 1-20 rose 14.1 percent to 1,058,844 tonnes from 928,110 tonnes shipped during Sept. 1-20. Malaysia, the world's No.2 producer of palm oil, will scrap a tax free export quota for the crude grade from 2013 in a bid to reduce feedstock prices for refiners who have lost market share to top supplier Indonesia. According to latest data from SEA, total vegetable oil imports in September were 993,912 tn, up from 897,018 tn in the previous month. India imported 111,163 tn of refined palm oil in September. As per MPOBs latest report, Malaysia's September palm oil stocks rose 17 percent to record high 2.48 million tons compared to previous month. Moreover, crude palm oil output in September rose 20 percent from August to 2 million tons.

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Nov '12 Futures Rs/100 kgs Rs/100 kgs Last 4200 4269 Prev day -0.59 0.71

as on Oct 22, 2012 WoW 0.00 2.13 MoM 5.46 7.15


Source: Reuters

YoY 42.37 38.16

Technical Chart Soybean

NCDEX Nov contract

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


due to low stocks coupled with festive season demand for its oil. However, prospects of better sowing pressurized the prices. Mustard output was lower in 2011-12 and thus this has led to tight supplies in the domestic markets. However, on the back of higher returns and improved rains, next years output is expected to be better. The Futures settled 1.95% higher w-o-w. Outlook Edible oil complex is expected to trade on a positive note today due to festive demand. Also, the prices may take cues from the strong international markets.

Source: Telequote

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

valid for Oct 23, 2012 Support 680-685 3230-3270 4165-4225 432-437 Resistance 699-705 3360-3410 4310-4370 448-455

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Commodities Daily Report


Tuesday| October 23, 2012

Agricultural Commodities
Black Pepper
Pepper futures traded on a positive note yesterday due to firm sentiments. Festive season demand has also supported the prices in the Futures. However, the spot prices remained under pressure due to expectations of a better output in the coming season. Farmers are unwilling to sell their stocks at lower levels. Traders are buying pepper directly from the farmers. Exports demand for Indian pepper in the international markets remains weak due to huge price parity. The Spot settled 0.36% lower while the Futures settled 1.44% higher on Monday. 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 $8,850/tonne(C&F) while Indonesia Austa is quoted at $6,850/tonne (FOB). Vietnam was offering 550GL at $7,000/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 Nov '12 Futures Rs/qtl Rs/qtl Last 42284 44135 % Change Prev day -0.36 1.44

as on Oct 22, 2012 WoW -0.16 1.81 MoM 0.88 1.34 YoY 23.29 29.50

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 September 2012 is estimated around 80,433 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 23, 2012 Support 43530-43880 Resistance 44550-44780

Production and Arrivals


The arrivals in the spot market were reported at 20 tonnes while offtakes were 20 tonnes on Monday. 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). 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) 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 continue to remain firm and trade on a positive note today. Festive season demand is expected to support prices at lower levels. However, low export demand as well as good supplies in the international market from other origins may cap sharp gains.

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Commodities Daily Report


Tuesday| October 23, 2012

Agricultural Commodities
Jeera
Jeera November Futures corrected yesterday due to profit booking at higher levels. Also, a stronger Rupee added to the downside. However, the spot prices did not correct as much as the Futures due to good export as well as festive demand. Over the last couple of days, exporters have been buying actively due to escalated tensions between Syria and Turkey. Good rains in Gujarat, have increased expectations of better sowing prospects ahead of the rabi sowing and have restricted sharp gains in the spot markets.. The spot as well as the Futures settled 0.88% and 2.21% lower on Monday. According to markets sources about 75% exports target has already been achieved due to a supply crunch in the global markets. Around 4-5 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 $2,900 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 4-5 lakh bags lower by around 3 lakh bags last year.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Nov '12 Futures Rs/qtl Rs/qtl Last 15075 15123 Prev day -0.88 -2.21

as on Oct 22, 2012 % Change WoW -0.20 -0.71 MoM 4.17 10.42 YoY 5.86 13.12

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 Monday. 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 0.00 -3.15

as on Oct 22, 2012 % Change

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

Last 5021 5106

WoW -3.06 -6.00

MoM -11.01 -10.17

YoY -8.03 9.10

Outlook
Jeera futures are expected to trade sideways. Prices may recover due to export buying. Festive buying may also lend support to the prices. However, exporters may stay away at higher prices. In the medium term (October-November 2012), prices are likely to stay firm as there are limited stocks with Syria and Turkey.

Technical Chart Turmeric

NCDEX Nov contract

Turmeric
Turmeric Futures traded on a bearish note yesterday due to lack of fresh orders from the upcountry market and exporters. Stockists also have good carryover stocks with them. Turmeric has been sown in 0.58 lakh hectares in A.P as on 10/10/2012. Sowing is also reported 30-35% lower during the sowing period. The Spot market remained closed due to Ashtami and is expected to reopen on Thursday. The Futures settled 3.15% lower on Monday. Special Margin of 20% (in cash) on the Long Side in Turmeric November 2012 and December 2012 expiry contracts will be withdrawn with effect from beginning of day Saturday, Oct 20, 2012.

Production, Arrivals and Exports


Arrivals in Erode mandi stood at 2,000 bags while Nizamabad remained closed on Monday. 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 23, 2012 Support 14850-14970 4950-5030 Resistance 15300-15460 5160-5220

Outlook
Turmeric prices are expected to trade downwards today. Lack of fresh orders may pressurize prices. However, a reduction in the special cash margin, lower sowing figures and lower arrivals may support prices.

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Commodities Daily Report


Tuesday| October 23, 2012

Agricultural Commodities
Kapas
NCDEX Kapas futures extended further gains and settled up by 2.01% on account of emerging demand along with firm international market. Also, reports of procurement by CCI of new crop cotton supported the upside. ICE cotton futures closed marginally up by 0.07% on ongoing fears of supply squeeze. Pace in harvesting also weighed on the prices. Cotton harvesting has commenced in US, in all 38% is harvested as compared to 28% a week ago, versus 39% same period a year ago. Cotton crop condition is 42% in Good/Excellent state same as compares to last week, and 29% same period a year ago as on 23 Oct 2012.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 1014 16790

as on Oct 22, 2012 % Change Prev. day WoW MoM 2.01 6.74 10.16 1.08 3.77 3.77 YoY -5.89

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 76.93 81.35

as on Oct 22, 2012 % Change Prev day WoW 0.07 2.77 0.00 0.00 MoM 4.33 0.00 YoY -22.82 -29.20

Domestic Production and Consumption


As on 28 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 2012-13 seasons is revised upward to 334 lakh bales compared with 352 lakh bales in 2011-12 season. Also, on account of cheaper cotton available in the global markets, imports have more than double from 5 lakh bales to 12 lakh bales. According to the latest CAB report as on 04 October 2012, exports have dipped sharply by 46% to 7 million bales in the 2012/13 marketing year that began on Oct. 1 compared to 12.7 million bales estimated for 201112 season. The ending stocks figure, has been revised further upward to 3.4 million bales as compared to 2.8 million bales estimated for August 2011-12 season
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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. In its October monthly demand supply report on Thursday, the Agriculture Department (USDA) raised its cotton crop for 2012/13 cotton crop season to 17.29 mln bales (prev 17.11) along with upward revision in end stocks 5.60 mln 480 pounds/bales (prev 5.30). Exports were down to 11.60 mln 480 pounds/bales (prev 11.80). China's 2012/13 cotton crop is estimated at 31.50 mln bales up from previous estimates of 31.00 mln bales given in September, imports 11.00 mln bales down from previous estimates of 12.00 million bales, consumption was pegged at 36.00 mln bales (down from prev 38.00 million bales), end stocks 36.61 mln bales (up from prev 35.51 mln bales)
Source: Telequote

Technical Chart - Cotton

MCX Oct contract

Source: Telequote

Outlook
Kapas futures in intraday is expected to trade on a positive note on account of improved demand. Also, Prices might take support as farmers are not willing to sell their produce at lower levels. In addition, supply worries due to poor quality of the fresh cotton crop delivery in the international market will give prices a further upward push. However, fresh arrivals from all over India and higher global cotton ending stocks might cap the sharp upside in medium term.

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

valid for Oct 23, 2012 Support 992-1003 989-1000 16400-16540 Resistance 1027-1040 1023-1035 16900-17080

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