NCDEX Turmeric Remains Lower on Increased Arrivals

Turmeric Spot prices and Futures witnessed selling pressure on account of continued increased arrivals amidst lower offtakes and settled 0.45% and 1.28% down respectively on Friday.

Production, Arrivals and Exports
Arrivals in Nizamabad and Erode mandi stood around 1,000 bags and 10,000 bags respectively on Friday.

Turmeric production for the year 2011-12 is projected at historical high of 82 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 2010- 11. Erode is expected to produce45 lakh bags of turmeric a rise of 29% as compared to previous year.

According to Spices Board of India, exports of Turmeric during April 2011- October 2011 stood at 50,000 tonnes as compared to 32,000 tonnes in 2010-11, rise of 56%. Targets set by the Spices Board have already been met till October 2011.

Exports are expected to touch new historical levels in 2011-12.

Courtesy: Angel Commodities


NCDEX jeera trades up on weak arrivals

Jeera Spot prices and Futures continued to trade steady to slightly high on account of declining arrivals amidst demand from the local stockists and settled 0.12% and 0.98% higher respectively on Friday.

Expectation of ground frost in the chief growing areas is providing support to the prices.

According to Gujarat farm ministry, area sown under jeera till December 26, 2011 stood at 2.78 lakh hectares (lh) up 21.5% as compared to last year. Carryover stocks of jeera is expected to be around 9-10 lakh bags as compared to 4-5 lakh bags in the last year.

Prices in the global markets of Indian origin are quoting around $2,800-2,950/tn while Syrian origin is quoting at $3,100-$3,150/tn.

Production, Arrivals and Exports
Unjha markets witnessed arrivals of 5,500 bags 1,000 bags higher as compared to Thursday amidst off takes of 6,000 bags on Friday.

Production of jeera in 2011-12 is expected to be around 35 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 during April 2011-Ocotber 2011 stood at 20500 tonnes as compared to 19,800 tonnes in 2010-11, an increase of 3.5%.

Courtesy: Angel Commodities


NCDEX pepper ends higher on fresh buying

Pepper prices witnessed firm movement throughout the day and settled 0.95% higher on Friday. Spot prices also traced Futures and settled 0.14% higher yesterday.

Demand from the overseas and domestic buyers is dull as buyers are following a wait and watch stance anticipating fall in the prices as fresh arrivals will gain momentum shortly.

Indian parity in the international market is being offered at $6,950/tonne.

Exports

According to Spices Board of India, exports of pepper during April 2011- October 2011 stood at 13,750 tonnes as compared to 10350 tonnes in 2010-11, rise of 32.8%.

According to International Pepper Community (IPC) exports of black pepper during January to October 2011 from six major exporting countries (Brazil, India, Indonesia, Malaysia, Vietnam and Sri Lanka) was around 2.04 lakh tonnes a decline of 4.6% as compared to 2.14 lakh tonne in the same period last year.

Exports from Indonesia posted significant decrease of 40% as compared to previous year. Exports stood at 29,000 tonnes as compared to 48,500 tonnes in the last year.

During Jan to Oct 2011, Brazil exported 25,331 tonnes of pepper a rise of 4.74% as compared to previous year. U.S. remained the major destination of the pepper imports.

Production and Arrivals
Arrivals of pepper in the domestic mandi on Friday stood at 5 MT as compared to 20 MT on Wednesday while offtakes on the other hand stood at 21 tonnes.

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%. Pepper production in Vietnam and Indonesia is projected at 1.10 lakh tonnes while that in Indonesia is projected to be 41 thousand tonnes. (Source: Financial Express).

On the other hand production of pepper in India in 2011-12 is expected to be scale down further by 5% to 43 thousand tonnes as compared to 48 thousand tonnes in the last year.

Courtesy: Angel Commodities


NCDEX soybean declines on profit booking

NCDEX January soybean futures ended slightly lower on account of profit taking after continuous rise in the last 4 trading sessions.

Weak overseas market as year ending also added bearish market sentiments. Arrivals of soybean improved slightly on Friday also provided support to the bears. Total arrivals of soybean in Madhya Pradesh were 2 lakh bags on Friday as compared to 1.7 lakh bags on Thursday, Maharashtra was 1.25 lakh bags, as compared to 1 lakh on Thursday and Rajasthan was 65,000 bags (Bag=90-100 Kg) on Friday as compared to 55,000 bags on Thursday. Soybean prices in Indore were at Rs 2350-2380/qtl (auctions in Mandi) and plant delivery was quoted Rs 2450-2490/quintal. Soy meal prices were quoted Rs 18000/quintal at FOR Kandla.

USDA’s weekly export figures released on December 22, 2011, which shows that the net weekly export sales for soybeans came in above trade expectations at 653,400 metric tonnes for the current marketing year and 75,000 for the next marketing year for a total of 728,400. Meal sales came in at 142,000 metric tonnes as compared with 97,000 metric tonnes.

Net oil sales came in at 14,800 metric tonnes which was higher than expected and compares with 11,000 tonnes.

Rape/mustard Seed
NCDEX January RM Seed futures traded higher on account of lower sowing acreage and lower production estimates for this year as compared to last year as crop damage due to frost in Rajasthan and Haryana. Sowing acreage of Rabi oilseeds in India was 7.8 million hectare (down 6.3%) as compared to 8.31 million hectare a year ago on 23/12/2011. Sowing acreage of rape/mustard seed in India was 6.38 million hectare (down 5.8%) as compared to 6.77 million hectare a year ago. Sowing acreage of Rabi oilseeds in Rajasthan was 2.63 million hectare as compared to 3 million hectare a year ago on 23/12/2011. Sowing acreage of rape/mustard seed in Rajasthan was 2.52 million hectare as compared to 2.49 million hectare a year ago.

Mustard seed accounts for about 70% of India's winter-season oilseed output.

Refined Soy Oil
NCDEX January refined soy oil futures lower on account of profit taking after continuous rise in the last 4-5 trading sessions. Traders squared off their positions at year end. As per SGS (cargo surveyor), Malaysian Palm Oil exports from 1-25 December fell by 12% to 1.18 million tonnes as compared to the same period last month. Imported crude palm oil quoted Rs 54500/tonnes on Friday, unchanged as compare to Rs 54500/tonnes on Thursday. Imported crude soy-oil price quoted Rs 66,000 /tonnes on Friday, unchanged as compared to Rs 66,000/tonnes on Thursday.

Courtesy: Angel Commodities


NCDEX sugar tumbles on long liquidation

Sugar futures witnessed long liquidation by the market participants and settled 0.55% lower on Friday. However, spot prices settled 1.295 higher on reports that Food Minister’s might consider 1 million tonnes more Sugar exports for 2011-12 seasons.

The government has released lower monthly quota for the month of January at 17.16 lakh tonnes which includes 2.16 lakh tonnes of levy quota and 15 lakh tonnes of non levy quota. The quota for January is much lower compared to January 2011 monthly quota of 19.18 lakh tonnes and last month’s quota of 19.07 lakh tonnes.

According to the Food Minister, Ministry is planning to discuss with States, the Finance and Agriculture Ministries on removing some of the controls such as doing away with the mandatory obligation to offer sugar for the public distribution system (PDS) in the New Year(Source: Hindu Business Line.

Liffe white sugar & ICE Raw settled 0.43% and 0.89% lower on Friday amidst long liquidation ahead of year end book closing by the hedge funds.

Domestic Sugar updates
Sugar output in Maharashtra rose 9% between Oct 01 and Dec 15 to 18.6 lakh tonnes compared with the 17 lakh tonnes same period last year. The output was earlier down by 6%. Recovery rate also increased to 10.07% from 9.70% a year ago.

According to ISMA, India is likely to have crushed 14.4 mln tn cane during Oct 1-Nov 23 and produced 1.3 mln tn sugar during the current crushing season. Maharashtra Oct 1-Dec 8 sugar output is up at 1.45 mln tn vs 1.31 mln yr ago due to higher recovery at 9.8% from 9.344% last year.

Indian Sugarcane production is estimated higher by 0.9% at 342 mn tn for 2011-12 season starting October 1, 2011. ISMA has projected sugar production at 26 million tonnes for 2011-12.

With the opening stocks of 6 mn tn, domestic Sugar supplies are estimated at 32 mn tn against the domestic consumption of around 23 mn tn. Thus there is a wide scope for exports from India.

Global Sugar Updates
Thailand has crushed 9.4 mn tn cane this season against 3.3 mn tn a year ago. Thailand sugar output could reach to 9.9 million tonnes in 2011-12 compared to 9.64 million tonnes in 2010-11.

According to UNICA, Sugar output in Brazil's center-south in the first half of November fell 13.8 percent from a year ago, as more mills ended crushing the 2011/12 cane crop. Sugar production in the period totaled 1.26 million tonnes, compared with 1.46 million tonnes a year earlier.

Swiss sugar consultancy Kingsman lowered its global 2011-12 sugar surplus estimate by 940,000 tn to 8.22 mln tn.

Courtesy: Angel Commodities


NCDEX chana gains on lower acreage

Chana spot prices continued to trade firm on account of lower acreage covered under Rabi pulses and Chana. Spot prices settled 0.04% higher on Friday. Lower area covered under Chana is providing support to the prices. Chana Futures however, remained steady and settled 0.30% lower yesterday.

According to the Farm Ministry area sown under Rabi pulses is down by 1.28% to 13.85 million hectares as compared to 14.02 lakh hectares in the same period previous year. Chana sowing till December 23rd 2011 is 5.9% down at 8.64 million hectares as compared to 9.18 million hectares in the same period previous year.

 According to Gujarat farm Ministry, Chana acreage in the state is down 4.9% to 1.84 lakh hectares as con December 26th 2011.

Rajasthan, rabi pulses area is 1.60 mln hectares as compared to 1.56 mln hectares as on 16th December 2011. Area covered under Chana stands around 1.56 mln hectares as compared to 1.54 mln hectares in the same period previous year(State Farm Ministry)

Forward Market Commission (FMC) has scrapped special margin of 10% on Chana on long side on all running contracts with effect from Friday December 09, 2011.

Sowing progress and Production
Chana is the main Rabi Pulse crop grown in India, sowing of which is done during October-December, and harvesting begins in January. Sowing of Chana began on a brisk note; however, the progress was not satisfactory in Maharashtra, Karnataka, UP, Bihar and AP.

Indian government is targeting total pulses output of 17 mln tn in the current crop year that started July 2011, down marginally from last year's record production of 18.09 mln tn on account of 10% decline in Kharif Pulses output. Although government has targeted higher Rabi Pulses output, it is difficult to achieve the same taking into consideration the sowing progress and prevailing weather conditions.

According to the first advance estimates, Kharif Pulses output for 2011- 12 season is down by 9.6% at 6.43 mt. Tur output estimates is up by 0.35% while moong & Urad is down by 21% & 16% respectively. Kharif Pulses sowing is down by 9% as on 23rd September, 2011. 109.41 lakh ha has been covered against 120.3 lakh ha in the last year.

Courtesy: Angel Commodities


NCDEX guar seed under pressure on weak fundamentals

Guar complex after trading firm in the last few trading session witnessed selling pressure on fears that Forward Market Commission (FMC) might impose stricter norms to curb high volatility in the prices. Despite imposition of 30% special margin bulls continued to build fresh long positions on expectations of robust exports and lower output. Total margin on long positions on the Complex has risen to 40%.

Reports of discrepancies in the latest export figures released by the APEDA (Agricultural & Processed Food Products Export Development Authority) coupled with talks of high manipulation has also led to high volatility in the Guar prices.

In addition to this FMC is mulling a last resort to cool Guargum and Guar seed prices through introduction of “trade to trade” for the first time in commodities derivatives market (Source: Business standard).

Indian Guar gum Association has sought the FMC’s intervention so as to curb rising Guar seed and Gum prices. They clarified that the price surge is not only defeating the futures trade, but also hurting the export prospects. (Newswire 18).

Arrivals of late sown Guar crop is ongoing in Rajasthan. Arrivals currently in Rajasthan and Haryana stand around 1.1 lakh bags (Newswire 18).

Production
Guar seed output in Rajasthan is estimated at 11.36 lakh tonnes for 2011-12 season, down by 25% compared to 15.46 lakh tonnes in 2010-11 (Rajasthan Farm Dept). Production of Guar in Haryana and Gujarat is expected to be 0.2 lakh tonnes and 0.07 lakh tonnes respectively in 2011- 12.

Carryover stocks of Guar in the current season is at lowest levels around 1.5-2 lakh tonnes against normal 4-4.5 lakh tonnes.

Thus, with lower carryover stocks and lower output the supplies would not be sufficient in the long run if Guar gum export trend continue to remain the same as last year, thus supporting the upside rally in the longer term.

Exports
Exports of Guar gum from April to July of the current fiscal year 2011-12 stood at 1.93 lakh tn a rise of 82% compared to 1.02 lakh tn during the same period last year. However, the latest figures from April to August are 5% lower than the April – July number published last month. This has created panic in the markets.

Courtesy: Angel Commodities