Commodities Report: November 14,2011

Pepper prices continued the upside movement on extended short covering on Saturday.

From Starting of the session prices remained higher. However, during later hours prices shaded some the gains giving positive closing.

Courtesy: Karvy Commtrade Ltd.

India Turmeric Gains On Rising Demand

Turmeric prices witnessed huge recovery on short covering on earlier losses.

Though spot activity remained bearish during last week due to higher production estimates, but futures took smart recovery and ended in green.

Courtesy: Karvy Commtrade Ltd.

Jeera Declines On Long Liquidation

Jeera futures extended the bearish trend on long liquidation on Saturday.

Increased arrivals across the spot markets along with sowing progress pressurized the prices. Therefore, on cues from spot activity futures ended in red.

Courtesy: Karvy Commtrade Ltd.

Chilli Regains On Short Covering

Chilli prices took small recovery on short covering on Saturday.

Futures started the day on flat to positive note and resumed upside later on. However, largely fundamentals remained down amid higher production expectations.

Courtesy: Karvy Commtrade Ltd.

MCX Cardamom Edges Higher On Short Covering

Cardamom prices took smart recovery on short covering on Saturday. Shifting of positions from current contract to far month contracts supported the prices.

However, spot market activity remained steady on limited buying from local buyers.

Courtesy: Karvy Commtrade Ltd.

NCDEX RM Seed Finishes Up On Weak Sowing

Mustard seed prices closed positive on Saturday as the sowing progress is lagging when compared to the normal sowing that happen in rajasthan regions in every season.

Weather conditions and soil moisture levels have been very congenial for crop sowing however other competitive crops are of more focus by farmers.

Courtesy: Karvy Commtrade Ltd.

NCDEX Soy Complex Edges Higher On Firm Domestic Demand

Soybean prices closed positive on Saturday owing to physical demand of soybean in spot markets. Short covering on the price fall in previous week helped prices to end higher.

Overall weakened Chinese demand for soybean limited steep upside across the globe during closing of previous week.

Soy oil prices slightly gained on closing during Saturday. Strength in palm oil prices is preventing prices from fall as domestic crushing season and weak Chinese demand is weighing on the prices.

Disrupting supplies of palm oil and possible shift of demand to soy oil helped prices to gain.

Courtesy: Karvy Commtrade Ltd.


NCDEX Chana Edges Higher On Firm Demand

Chana futures traded positive on Saturday. Regular demand across the markets along with supply concerns across the markets supported the prices to trade higher.

Weak sowing progress in Southern states (Andhra Pradesh and Karnataka) had a positive impact over the prices. Prices across the physical markets were stable at Rs.3475 per quintal.

Courtesy: Karvy Commtrade Ltd.

NCDEX Guar Seed Tumbles On Arrival Pressure
 
A volatile trend was witnessed in guar seed and gum futures on Saturday. Arrival pressure across the markets had affected the guar seed prices to trade downside.

Arrivals in Jodhpur physical market were over 1 lakh bags. Arrivals though in comparatively small quantity had begun in Bikaner physical markets and were around 2,000 bags.

On contrary, traders took advantage of earlier losses in gum and went for buying at lower levels thereby supporting the prices to trade higher.

Prices across the physical markets had declined from Rs.4200 to Rs.4150 per quintal.

Courtesy: Karvy Commtrade Ltd.


NCDEX Maize Weakens On Fresh Arrivals

Maize futures traded negative on Saturday. Fresh arrivals along with sluggish demand for the commodity in Nizamabad and Davangere physical markets had affected the prices to decline.

However, stockiest demand for maize in Delhi market limited the losses.

Prices across the physical markets remained stable at Rs.1050 per quintal.

Courtesy: Karvy Commtrade Ltd.


NCDEX Wheat Drops On Selling Pressure

Wheat prices traded negative on Saturday. Traders took advantage of earlier gains and went for selling at higher prices levels which pressurized the prices to decline.

However, losses limited owing to regular demand for the commodity across the markets.

Losses were limited due to impact of decline in government stocks during at beginning of this month (29.67 million tons against 31.43 million tons as on October 1, 2011).

Prices across the physical markets had increased from Rs.1200 to Rs.1205 per quintal.

Courtesy: Karvy Commtrade Ltd.


Base Metals Settle Higher On Positive Us Data

Base metal prices ended higher with gains of anywhere between one to two percent on the back of positive spat of data from US and Italy voting through the austerity measures. Nickel was the only exception to end in red as build-up of stocks weighed on prices.

Open interest for most of the metals on MCX declined indicating short covering which pushed prices on the higher side.

Monthly budget statement came in slightly better than expected while the Michigan confidence indicated improvement in the consumer confidence in the month of November.

On Friday, US equity markets ended higher with gains of more than two percent as better than expected data raised the optimism. Euro also rose by more than a percent thereby supporting metal prices to move higher.

After the Italian Prime Minister stepped down, new leader has been appointed in the country thereby raising hopes that austerity measures would be implemented. Japanese economy grew by 1.5 percent in the third quarter of 2011 thereby ending three consecutive quarters of contraction.

This along with measures announced by the Euro zone nations is pushing Asian equity markets on the higher side. Dollar index is trading largely flat near the 76.8 levels. In the morning session on London Metal Exchange, base metal prices are trading higher with gains of anywhere between half to two percent.

On the economic data front, only Japan’s industrial production numbers are due to be released and there are no key economic data releases from US. Overall, positive developments in the Euro zone along with better GDP numbers from Japan, base metal prices are expected to remain on the higher side.

Aluminium
Aluminium stocks on London Metal Exchange witnessed draw-downs of 3,200 tonnes as against decline of 4,050 tonnes on the previous day.

Even on a weekly basis stocks witnessed drawdowns of 12,050 tonnes on LME. Warehouses in China however witnessed build-up of 17,070 tonnes.

Open interest declined by nearly 21 percent indicating short covering might have pushed prices higher.

Copper
Copper prices ended higher with gains of more than two percent on LME and 1.5 percent in Indian markets.

Copper stocks on London Metal Exchange witnessed draw-downs of 2,325 tonnes as against decline of 2,125 tonnes on the previous day.

Even on a weekly basis, stocks witnessed drawdowns of 10,150 tonnes from LME and 479 tonnes from Chinese warehouses.

Lead
Lead stocks from London Metal Exchange warehouses witnessed draw-downs of 1,925 tonnes as against decline of 1,275 tonnes on the previous day.

On a weekly basis, stocks declined by 7,725 tonnes from LME and warehouses in China witnessed drawdowns of 278 tonnes.

Open interest declined by 15 percent on MCX indicating short covering which pushed prices higher by more than a percent.

Nickel
Nickel was the top loser among the base metal pack as it ended with losses of 0.4 percent on LME and 0.6 percent in Indian markets.

Stocks continue to witness net build-up. On LME stocks increased by 900 tonnes thereby reducing the weekly draw-downs to 1,296 tonnes.

Cancelled warrant ratio continues to drift lower and now it stands at close to 2.7 percent, one of the lowest among the base metal pack, indicating build-up might be continue in the near term.

Zinc
Zinc prices ended higher with gains of 1.5 percent on LME and 0.7 percent in Indian markets.

Zinc stocks from London Metal Exchange witnessed draw-downs of 4,200 tonnes as against decline of 1,375 tonnes on the previous day.

On weekly basis, stocks declined by 12,275 tonnes from LME. Warehouses in China also witnessed draw-downs of 3,998 tonnes.

Courtesy: Karvy Commtrade Ltd.