Commodities Daily Report

Wednesday| February 20, 2013

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
Wednesday| February 20, 2013

Agricultural Commodities
News in brief
Law ministry to vet revised food bill
The government has revised the Food Bill and now proposes to give legal right to over 5 kg of foodgrains at Rs 1-3 per kg per month to about 70% of the population as suggested by the parliamentary panel, food minister K V Thomas said here on Tuesday. A revised bill has been sent to the law ministry for vetting, after which it will be moved to the cabinet, he said. In the original bill, introduced in December 2011 in the Lok Sabha, the government had proposed giving 7 kg of wheat (Rs 2/kg) and rice (Rs 3/kg) per month per person to ‘priority households’, while at least 3 kg of foodgrain at half of the government fixed support price was proposed for the ‘general’ households. “We have accepted most of the recommendations of the parliamentary panel. The revised bill has been sent to the law ministry for vetting. After we receive its comments, we will place the bill before the cabinet,” Thomas told PTI. The minister said the government would not withdraw the existing bill and rather move amendments to incorporate changes as suggested by the panel and some states. “We have accepted panel’s recommendation to do away with priority and general classifications of beneficiaries and provide uniform allocation of 5 kg foodgrains (per person) at fixed rates to 67-70% of the country’s population,” Thomas said. (Source: Financial Chronicle)

Market Highlights (% change)
Last Prev. day

as on Feb 19, 2013
WoW MoM YoY

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

19636 5940 54.13 96.66 1604

0.69 0.70 -0.25 0.83 -0.32

0.38 0.29 0.62 -0.87 -2.74

-2.01 -2.06 0.72 1.15 -4.92

7.36 6.75 9.74 -6.37 -7.01

.Source: Reuters

Food rights organisations flay Sharad Pawar’s pitch for GM crops
Food rights organisations, under the aegis of the Right to Food Campaign (RFC), have written to Agriculture Minister Sharad Pawar urging him to tackle food security in more ‘fundamental ways’ rather than link it with genetically modified (GM) crops. At a press conference here on Tuesday, RFC released the letter signed by hundreds of organisations, including National Advisory Council member Aruna Roy criticising the Agriculture Ministry’s stance in an affidavit to the Supreme Court calling it a “trivialisation and mockery of the grave situation of hunger and malnutrition that exists in India”. “In this affidavit, your Ministry argued that GM crops and their field trials were needed for India’s food security, in addition to wilfully choosing to misinterpret the sound recommendations of the Technical Expert Committee set up by the Supreme Court,” says the letter. (Source: Business Line)

Wheat procurement may go up 15% to touch record 44 mt
The government's wheat purchase is expected to touch 44 mt in the 2013-14 marketing year starting April, surpassing last year's record of 38.1 mt, food minister K V Thomas said on Tuesday. This year, wheat procurement is likely to increase by over 15% despite marginal fall in output by 2.6 mt to 92.3 mt. Procurement of wheat, a major rabi crop, begins from April and continues till June. “We are targeting to procure 44 mt of wheat this year, about 5.9 mt higher than the last year,“ Thomas told PTI. In order to ensure immediate payments to farmers on delivery of wheat, the minister said that the states have been asked to make available adequate funds for procurement agencies and farmers should be paid via cheque. In view of problem faced by some states regarding availability of packaging material, states have been asked to ensure adequate availability in advance. (Source: Financial Chronicle)

Seed makers plan high-density Bt cotton planting to boost yield
Faced with stagnating yields from Bt cotton hybrids, seed makers are now advocating high-density planting or putting more plants an acre by reducing the spacing to boost the output. Nuziveedu Seeds, the largest Bt cotton seed vendor, has experimented the concept of high-density planting in about 10,000 acres in Vidarbha covering some 3,500 farmers last kharif in a public-private partnership (PPP) project to improve cotton production. “We are looking to scale up this project to about one lakh hectares during the kharif season this year and are in talks with the Maharashtra Government,” said M. Prabhakara Rao, Chairman, NSL Group. (Source: Business Line)

Unseasonal rain damages potato crop
Unseasonal rainfall in major potato- growing states has damaged the crop, resulting in a rise in its prices. Though the actual loss is yet to be ascertained, experts say the sustained, untimely rainfall would have a long- term impact. When temperatures start rising in March, the tubers would start rotting, they add. The winter season was followed by unseasonal, intermittent rain for about 20 days in major growing states such as Uttar Pradesh, Haryana, West Bengal and Bihar. This took a toll on the harvest. Earlier, the National Council of Applied Economic Research had estimated the output would rise five to seven per cent from 44.6- 5.6 million tonnes (mt) in 2011- 12. Another spell of rainfall has been forecast for February 23, after which the Central Potato Research Institute would send a team to major potato- growing belts to assess the damage to the crop. (Source: Business Standard)

New copra arrivals to keep coconut oil on leash
Coconut oil markets in Kerala and Tamil Nadu are still bearish, due to liquidation of copra by stockists. Prakash B. Rao, Vice-President, Cochin Oil Merchants Association, said that this has resulted in the decline in prices in both markets this week. The market is witnessing a selling trend at Rs 65 for a kg in Kerala (Rs 67) and Rs 63 in Tamil Nadu (Rs 64). Copra prices ruled stable at Rs 4,700 a quintal in Kerala and Rs 4,600 in Tamil Nadu, up by Rs 100 from last week. The rates are expected to drop further in the coming weeks on anticipation of the commencement of the new season in North Kerala, especially in Kannur and Kasargod districts, he said. (Source: Business Line)

Dry U.S. crop belt counts on more than a drop of February rain
Wheat and corn farmers are banking on more rain and snow in late February so they can keep nursing depleted soil back to healthier levels of moisture amid the worst drought in the United States grain belt in more than 50 years. Agricultural meteorologists said on Tuesday that the precipitation in the next week to 10 days will provide significant relief for crop prospects in the U.S. Plains and Midwest. John Dee, meteorologist for Global Weather Monitoring, said "this will really help add to soil moisture levels." Dee said .50 inch to 1 inch of rain could be expected over most of the Plains hard red winter wheat region late this week with a similar system bringing rain and snow again next week. "There also will be a lot of snow in the north, up to a foot in some areas, and this will really help as it will melt close to planting time," Dee said. He said the driest areas of the Plains, Iowa, Nebraska and Minnesota, would receive the lion's share of the precipitation. (Source: Reuters)

Onion prices fall on high arrivals, low demand
After touching peak levels in recent weeks, onion prices at wholesale markets are showing signs of cooling. At Lasalgaon in Maharashtra, the average price quoted yesterday was Rs. 1,175 a quintal as against Rs. 2,150 a quintal on January 30. The prices have almost touched the approximate levels of Rs. 1,100 a quintal seen in the beginning of January. Prices went up last month on delay in arrival of new crop and report of some crop damage. Prices had touched Rs. 2,331 a quintal in the wholesale market on January 31, creating turmoil among consumers. Things seem to be getting normalised and the higher prices have also dampened demand. “Prices have fallen in the past week due to lower offtake of onion both domestic and exporters. (Source: Business Standard)

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Commodities Daily Report
Wednesday| February 20, 2013

Agricultural Commodities
Chana
Chana spot continued with its upward trend on account of lower level demand, while futures witnessed profit booking and settled 0.46% lower on Tuesday. Ministry of Agriculture in its second advance estimates, have pegged, bumper chana output for 2012-13 season at 8.57 mn tn, up 11% from 2011-12 final estimates of 7.7 mn tn.

Market Highlights
Unit Rs/qtl Rs/qtl Last 3640 3441 Prev day 0.23 -0.46

as on Feb 19, 2013 % change WoW MoM 2.09 -6.94 0.35 -3.34 YoY 1.61 -0.29

Chana Spot - NCDEX (Delhi) Chana- NCDEX Apr'13 Futures

Pulses Sowing 2012-13
Chana sowing is 5.6% higher at 94.99 lakh ha compared to previous year. Chana acreage is marginally higher by 3% this year in Rajasthan at 14.80 lakh ha, In Maharashtra, Chana acreage is up at 11.12 lakh ha vs normal area of 10.6 lakh ha. While in AP it is up at 7.27 lakh ha, up by 28%. Compared to previous year. (Source: State farm dept)

Source: Reuters

Technical Chart - Chana

NCDEX April contract

Demand supply fundamentals
According to second advance Estimates released on 8 Feb 2013, Total pulses output for 2012-13 season has been pegged at 17.58 mn tn, down 3.3% compared to previous year. The target for 2012-13 pulses crop output was set at 18.24 million tonne during the year. However, drought conditions have hampered kharif pulses output, which has been only partially offset by Rabi pulses output, especially chana. Out of the total pulses output, kharif output is estimated at 23% lower at 5.48 mn tn while rabi pulses output is pegged 8.72% higher at 12.09 mn tn compared with the final estimates of 2011-12. There has been a sharp increase in the chana output estimates. on the back of higher acreage and good yield. Chana output is expected to breach its 2010-11 record of 8.2 mn tn and is estimated at 8.57 mn tn for 2012-13. In its first advance estimates chana output was pegged at 7.9 mn tn. India needs imports as its domestic production is insufficient to meet the rising demand. The country’s import bill on pulses stood at $1.83 billion in 2011-12. 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).
th

Source: Telequote

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

valid for Feb 20, 2013 Resistance 3470-3490

3410-3425

Trade Scenario
In Australia, total chickpea production in 2012–13 is estimated to have increased to a record of around 746000 tones as compared with 485000 tons 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.

Outlook
Chana Futures may decline initially on account of increasing arrival pressure. However, demand from the stockiest at lower prices may cushion sharp fall in the prices. It is crucial to keep a close watch on weather conditions. Adverse reports may bring in upside rebound in the prices.

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Commodities Daily Report
Wednesday| February 20, 2013

Agricultural Commodities
Sugar
Sugar spot continued with its upward trend on the back of improving demand. Sugar futures which opened higher initially corrected on account of profit taking and settled 0.85% lower in the March contract. India’s Agriculture Minister Sharad Pawar said that they are favoring Food Ministry’s proposal to increase the production tax on Sugar from the current Rs. 0.71/kg to Rs. 1.5/kg if mills were freed from an obligation to sell the sweetener at lower prices for public distribution. India's sugar production in the 2013/14 season is set to fall below consumption for the first time in four years as a water shortage trims acreage in three key states. Food minister KV Thomas on Thursday said the government is likely to take a decision on decontrolling the sugar industry before the Budget. Food ministry has proposed dispensing with the regulatory release mechanism and abolishing the levy system. India has fixed FRP (Fair and Remunerative Price), the price sugar mills must pay to cane growers at 210 rupees per 100 kg in the 2013/14 year, compared to current year’s 170 per qtl. Higher floor price increases the cost of production as the raw material cost constitute the major part of cost of production of sugar. This should actually increase the prices of sugar. Raw sugar futures on ICE settled 1.22% higher on account of profit taking while Liffe white sugar settled lower by 0.46% on account of global surplus situation which has led the prices to a sharp decline. Currently the prices are trading around their 2 ½ year lows.

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Feb'13 Futures Rs/qtl Last 3232

as on Feb 19, 2013 % Change Prev. day WoW 0.99 0.56 MoM -1.19 YoY 10.35

Rs/qtl

3095

-0.96

0.78

-5.12

7.50

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMay'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 495.6 404.89

as on Feb 19, 2013 % Change Prev day WoW -0.46 1.22 2.38 0.77 MoM 0.73 -0.82 YoY -22.95 -28.13

.Source: Reuters

Technical Chart - Sugar

NCDEX March contract

Domestic Production and Exports
Out of the estimated 24 mn tn sugar output for the season 2012-13, Indian 13.7 mn tn in the first four months of the season beginning October 2012, up 3 percent a year ago period. With the opening stocks of 6.5 mn tn, domestic Sugar supplies are estimated at 30.5 mn tn against the domestic consumption of around 22. 5mln tn for 2012-13. Exports are not viable as international prices have also declined significantly.

Source: Telequote

Global Sugar Updates
Brazil plans to reduce taxes on ethanol to boost production and use of the biofuel. If brazil cuts tax the ethanol parity to sugar may rise and thus the share of cane directed to sugar production in the 2013-14 season may be 44 -45%, down from 49.6 % in the current period. Brazil's main center-south cane crop will produce between 580 million and 590 million tonnes of sugar cane in 2013/14. Brazil will likely favor ethanol production over sugar from the 2013/14 cane crop. According to Job Economia, Brazil's main center-south cane crop is due to produce 36 mn tn of sugar in 2013/14 higher than 34.2 mn tn last year. In the international markets, ICE Raw sugar fell to their two and a half years low expecting third consecutive year of global surplus in 2012-13. A third consecutive global sugar surplus will trim prices as supply is forecast to exceed demand by more than 8 million tonnes in the crop year to September 2013.

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

valid for Feb 20, 2013 Resistance 3168-3195

3115-3128

Outlook
Sugar futures may open lower initially, however, may bounce back as demand is expected to improve gradually from the bulk manufacturers in the coming weeks. Markets may also take cues from the decision over sugar sector, which government is expected to consider before budget.

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Commodities Daily Report
Wednesday| February 20, 2013

Agricultural Commodities
Oilseeds
Soybean: Soybean March Futures gained 1.55% on Tuesday on
account firm international markets coupled with good demand for soybean from the crushing industry for its meal. Oil meal exports rose by almost 40 per cent to 7.68 lakh tonnes in January this year, industry body Solvent Extractors Association of India said. The export of oil meals, however declined by 18 per cent to 36.79 lakh tonnes in the first 10 months of this fiscal compared to 44.85 lakh tonnes in the year-ago period. The country exported 25.36 lakh tn soybean meal in first 10 months compared to 30.82 lakh tn in the same period last year which showing a decline of 17.72%. According to the second advance estimates, 2012-13 oilseed output is pegged at 29.4 mn tn, down by 1.1%, while soybean output is pegged higher at 12.9 mn tn, up 3.2%.
Soybean Spot- NCDEX (Indore) Soybean- NCDEX Feb '13 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Feb '13 Futures

Market Highlights
Unit Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3408 3399 734.3 734.3

as on Feb 19, 2013 % Change Prev day 0.68 0.97 -0.18 -0.20 WoW 2.59 4.38 0.40 0.83 MoM 5.28 4.96 -1.56 1.46 YoY 33.49 30.64 4.27 3.57

Source: Reuters

as on Feb 19, 2013 International Prices Soybean- CBOTMar'13 Futures Soybean Oil - CBOTMar'13 Futures Unit USc/ Bushel USc/lbs Last 1470 52.53 Prev day 3.21 1.76 WoW 3.48 2.80 MoM 2.80 2.02
Source: Reuters

YoY 15.68 -2.83

International Markets
Soybean Futures on CBOT witnessed sharp gains and settled 3.21% higher on account of concerns over the Argentina crop. Strong demand from China after the Lunar New Year break also pushed up the prices. China was also buying the old soybean crop. US soybean processors crushed 158.195 mn bushels of soybeans in January, the second-largest monthly total in 3 years due to huge demand for soy meal, both from exporters as well as domestic livestock producers. The scant rains and high temperatures worrying Argentine farmers since January have started to hit the development of corn and soy crops. 99% of the estimated soy area of 19.35 mn ha has been covered as on 14th Feb. Rains are urgently needed in the current yield-setting phase; otherwise productivity will be seriously affected. China, the world's largest soy buyer, imported 4.78 million tonnes of soybeans in January, down 18.8 percent from 5.89 million tonnes in December

Crude Palm Oil

as on Feb 19, 2013 % Change Prev day WoW 1.29 1.24 1.05 1.02

Unit
CPO-Bursa Malaysia – Mar '13 Contract CPO-MCX- Feb '13 Futures

Last 2506 457.4

MoM 10.45 3.37

YoY -22.51 -14.28

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Apr'13 Futures Rs/100 kgs Rs/100 kgs Last 3750 3474 Prev day 0.00 -0.12

as on Feb 19, 2013 WoW 0.00 1.64 MoM -10.07 0.58
Source: Reuters

Refined Soy Oil: Ref soy oil remained firm in the early part of the
session, however, settled lower on account of profit booking towards the end. CPO prices gained sharply taking cues from higher Malaysian palm oil export figure during the first fortnight of February. India's vegetable oil imports soared 27 percent from a month ago to an all-time high in January on purchases of cheap palm oil. To curb imports, the tariff value of crude palm oil, the edible oil India imports most, has been raised from $ 815 a tonne to $ 848 a tonne, a rise of 4.04%. However, 1-10 Feb Malaysian exports rose 25%. If the trend continues, CPO prices may witness an upside in the coming days.

YoY 10.91 -0.49

Technical Chart –Soybean

NCDEX March contract

Rape/mustard Seed: Mustard Futures settled marginally lower by
0.12% due to profit booking. Rains in the mustard growing regions have raised concerns over delay in the harvesting and arrivals of the new crop. Mustard seed sowing is now up by 2.2% at 67.23 lakh ha. Arrivals are expected to commence in February and thus no major upside in the prices is seen if weather condition improve in the coming days. Agriculture ministry in its third advance estimates, pegged mustard output at 7.36 mn tn, up by 11.5%.

Source: Telequote

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

valid for Feb 20, 2013 Support 705-707 3235-3270 3440-3455 450-454 Resistance 713-716 3330-3355 3490-3515 459-462

Outlook
Soybean complex is expected to trade higher today tracking positive international markets due to crop concerns in Argentina. Mustard seed may remain weak on higher output expectations. CPO may trade firm on expectations of palm oil exports to improve gradually while output may fall due to seasonally lower yield.

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Commodities Daily Report
Wednesday| February 20, 2013

Agricultural Commodities
Black Pepper
Pepper March Futures traded on a mixed note yesterday. Prices traded lower due to profit taking at higher levels but recovered towards the end on account of low stocks, thin supplies and delayed harvesting due to lack of skilled laborers. Harvesting of the fresh crop is going in and is expected to gain momentum in the coming days. Some improvement in the arrivals of the fresh crop led to a decline in the prices earlier last week. Food Safety and Standards Authority of India sealed the entire quantity of pepper stored in six warehouses in Kerala of about 8,000 tonnes. Exports demand for Indian pepper in the international markets is also weak due to price parity. The Spot as well as the Futures settled 0.06% and 0.11% higher on Tuesday. According to a circular issued by NCDEX on 09/02/2013, launch of June 2013 expiry contract in Pepper which is scheduled on February 11, 2013, has been postponed till further notice. The revised launch date will be announced in due course. Spices Board has announced plans to import high yielding Madagascar variety that was behind the record productivity in Vietnam. It could raise productivity of Indian pepper from 2,000 kg/ha to 7,000 kg/ha. Pepper prices in the international market are being quoted at $7,900/tn(C&F Europe). Vietnam’s 550 GL is quoted at $6,700/tn, Malaysia and Indonesia Austa variety are quoted at $7,000/tn and Brazil black pepper is quoted at $6,600/tn.

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Feb'13 Futures Rs/qtl Rs/qtl Last 41044 41400 % Change Prev day 0.06 2.18

as on Feb 19, 2013 WoW 1.65 5.17 MoM 5.38 10.49 YoY 29.63 33.20

Source: Reuters

Technical Chart – Black Pepper

NCDEX March 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. Pepper imports by U.S. the largest consumer of the spice declined 9% in 2012 period to 62,458 tn as compared to 68,489 tn in 2011. 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. Brazil exported 25,900 tn pepper during Jan-Nov 2012, around 20% lower compared with 32,650 tn in the same period last year. Exports from Malaysia 8,300 tn pepper during Jan-Oct 2012, lower by 30% last year while exports in October stood at 1,077 mt in.
Source: Telequote

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

valid for Feb 20, 2013 Support 37370-37650 Resistance 38280-38620

Production and Arrivals
The arrivals in the spot market were reported at 85 tonnes while off takes were reported at 80 tonnes on Tuesday. 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 estimates, pepper output in Vietnam is estimated to be 1.05 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 continue to trade higher today on account of low stocks coupled with thin arrivals. Reports that farmers are holding back stocks may also support prices at lower levels. However, any improvement in arrivals will cap sharp upside.

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Commodities Daily Report
Wednesday| February 20, 2013

Agricultural Commodities
Jeera
Jeera Futures traded on a positive note on account of short coverings. There is some demand from the domestic markets. Prices have declined as the arrivals of the new crop have gained momentum in the last few days. The arrivals of new crop are around 3,000 bags/day and are expected to increase in the coming days. Higher sowing as well as conducive weather in Gujarat, the main jeera growing region has increased output expectations. According to Gujarat State Agri Dept. sowing in Gujarat is reported at 3.244 lakh ha till Jan, 2013 compared with 3.64 lakh ha last year. In Rajasthan, sowing is expected to increase by 10-15%. The spot as well as the Futures settled 0.31% and 0.56% higher on Tuesday. 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 $2,975-$3,000 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 5-6 lakh bags.

Market Highlights
Unit Jeera Spot- NCDEX (Unjha) Jeera- NCDEX Mar '13 Futures Rs/qtl Rs/qtl Last 13911 13430 Prev day 0.31 0.56

as on Feb 19, 2013 % Change WoW 1.51 1.61 MoM -2.68 -1.90 YoY -5.01 -4.87

Source: Reuters

Technical Chart – Jeera

NCDEX March contract

Production, Arrivals and Exports
Arrivals in Unjha were reported at 7,000 tn on Monday. Production of Jeera in 2011-12 is expected around 40 lakh bags as against 29 lakh bags in 2010-11 (55 kgs each). 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 -0.40 -1.22

as on Feb 19, 2013 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Apr '13 Futures Rs/qtl Rs/qtl

Last 5473 6338

WoW 1.24 1.41

MoM -1.98 -0.50

YoY 17.39 31.88

Outlook
Jeera Futures is expected to trade on a negative note today on account of higher arrivals. However, overseas demand at lower levels may support prices. Demand from domestic traders and millers may also support prices at lower levels. In the medium term, prices are likely to stay firm as Syria and Turkey have stopped shipments.

Turmeric
Turmeric Futures declined yesterday due to supplies of the new crop coupled with higher carryover stocks. Prices have gained over the last few days due to some unseasonal rains in Andhra Pradesh coupled with output concerns. There is good demand from local buyers and stockists. The Spot as well as the Futures settled 0.4% and 1.22% lower on Tuesday.

Technical Chart – Turmeric

NCDEX April contract

Production, Arrivals and Exports
Arrivals in Erode stood at 2,500 bags while Nizamabad mandi remained closed on Tuesday due to labour strike and will open on Friday. Expectations are that production may be lower by 40-50%. There are reports of some crop damage in Erode region. Turmeric production in 2012-13 is expected around 50 lakh bags. Production in Nizamabad is expected around 12 lakh bags. Production in 2011-12 is projected at historical high of 10.62 lakh tn. It is estimated that next year’s carryover stocks would be around 10 lakh bags 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 is expected to trade sideways today. Lower output concerns and demand from stockists at lower levels is expected to support prices at lower levels. However, higher carryover stocks and weak overseas demand may pressurize prices at higher levels.
.

Source: Telequote

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

Valid for Feb 20, 2013
Support 13250-13340 6210-6270 Resistance 13540-13640 6420-6510

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Commodities Daily Report
Wednesday| February 20, 2013

Agricultural Commodities
Kapas
Kapas futures and MCX Cotton witnessed profit taking on Tuesday and settled lower by 1.38% and 0.29% respectively. Prices have gained in the last one week on account of improved demand and expectations china may as China may release import quota. Cotton supplies since the beginning of the year in October 2012 until February 10, 2013 were down at 183.4 lakh bales, down from 189.27 lakh bales a year earlier. The Cotton Advisory Board, which met in Mumbai on Wednesday, has estimated cotton production this season (Oct 2012 to Sep 2013) will be 330 lakh bales against the previous estimates in October at 334 lakh bales. Also, exports and domestic consumption has been revised upward to 253 and 80 lakh bales respectively from 250 and 70 lakh bales estimated earlier. As on January 9 this year, nearly 38 lakh bales were registered for exports. ICE Cotton futures traded on a bullish note and closed 1.06% higher as China returned after the New Year break. There is strong demand from China. US Cotton acreage is likely to go down by 27% which may support prices in the international markets. Strong weekly export sales figures also supported prices last week.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 926 17320

as on Feb 19, 2013 % Change Prev. day WoW -1.38 2.09 -0.29 1.58 MoM 0.60 1.58 YoY #N/A -2.70

NCDEX Kapas Apr Futures MCX Cotton Feb Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit USc/Lbs Last 82.18 81.35

as on Feb 19, 2013 % Change Prev day WoW 1.06 0.45 0.00 0.00 MoM 4.62 0.00 YoY -9.94 -29.20

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Domestic Production and Consumption
According to Cotton Advisory Board’s (CAB) estimates (23 Jan 2013) for 2012-13 season that commenced in October, domestic cotton production is pegged 330 lakh bales, down from the previous year’s estimates of 353 lakh bales. However, higher exports and domestic consumption can be met through revised higher opening stocks of 40 lakh bales and higher imports. 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 80 lakh bales this season, compared with 128.8 lakh bales last year.
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Source: Telequote

Global Cotton Updates
U.S. weekly export sales of the Cotton nearly doubled in the week ended Feb. 7 to a total of 185,700 running bales. The strong recovery after two weeks of declining exports alleviate concerns of waning demand from Chinese buyers, though the volumes remained five percent lower than the previous four-week average. The U.S. government on Friday nudged higher its global cotton stockpile forecast for 2012/13 amid expectations that China, the world's largest textile market, will import even more fiber for its massive strategic supply. However, the government lowered US carryover by 300,000 bales, or 6 percent, to 4.5 million bales due to an increase of the same size in its export estimate to 12.5 million bales.

Technical Chart - Cotton

MCX Feb contract

Source: Telequote

Outlook
Kapas/Cotton prices may recover from lower levels on account of firm international markets amid lower US cotton planting intentions for 201213. However, sufficient supplies in the domestic markets and lower export demand expectations may cap sharp upside in the prices.

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

valid for Feb 20, 2013 Support 910-919 17240-17290 Resistance 938-950 17400-17450

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