By Nirmal Bang
SPICES COMPLEX
MARKET ROUNDUP
Spices complex continue to remain volatile yesterday we have seen some amount of profit taking in pepper and jeera. Cardamom and mentha oil continues to trade firm.
IN FOCUS
- Robust export demand in cardamom is helping prices to move up despite of high arrivals in auctions prices were firm it shows the strength in the market, we feel due to export demand bull trend in cardamom may stay intact.
- Pepper, yesterday due to disparity in spot and futures we have seen some correction. Pepper futures plummeted as spot prices were trading at discount by Rs.450/quintal as compared to futures and Indian quotes for exports were pretty high.
- Turmeric after the sharp decline arrivals have gone down in major mandis so bounce back can’t be rule out. Long term trend still bearish in turmeric but it seems that rallies are to be sold for long term investors.
- Jeera due to good exports prices shot up and markets require fresh triggers to move up as spot markets remained closed. Jeera exports in the month of October, 09 were 5500 tonnes and reports of irrtaic weather conditions in Turkey and Syria are also seen supporting jeera futures.
FUNDAMENTAL OUTLOOK
We recommend to buy turmeric for the upside if Rs.200-250/quintal, pepper and jeera we recommend to buy at dips and mentha oil looks very strong for the day
GUAR, PULSES AND GRAINS COMPLEX
MARKET ROUNDUP
Wheat futures plunged in yesterday trading session due to higher supply in the market.Chana traded mixed and ended higher yesterday backed by overall optimism in the agri market.Guar complex witnessed some profit taking in last trading session.
IN FOCUS
- Chana arrivals are 7000-8000 bags at Delhi's Lawrence Road Mandi. The Spot price is expected to open at Rs.2485-95/quintal same it was on previous day's trading session.
- Heavy rain fall in some areas of states like Madhya Pradesh and Rajasthan can hamper the production estimates for the coming Rabi crops. Expectations of better production this year might not be achieved if rain continues
- Govt. has started giving 2 lakh tones of wheat each ward in many states like Delhi and MP. It has planned to give 5 million tones in the open market till the year ends. This excess stock with the Govt. limiting the imports where these imports are pricing almost 15% less than domestic prices for the south mills.
- The area under chana may shrink this year in Rajasthan due to poor rainfall and a diversion towards rapeseed, Chana acreage in Rajasthan as on Nov. 20 stood at 680,000 hectares, compared with 971, 000 hectares in the same period last year.
FUNDAMENTAL OUTLOOK
Chana is expected to trade sideways to up for the day. Guar complex after witnessing profit booking for two trading sessions is expected to trade up for the day and we recommend buying at dips for the entire complex. Wheat futures are expected to trade sideways to down for the day.
OIL AND OIL SEEDS COMPLEX
MARKET ROUNDUP
Oilseeds complex traded in thin range in last trading session with exception to Cotton seed oil cake which rose by more than 2% on back of good export demand.
IN FOCUS
- US, Brazil and Pakistan have no surplus cotton, while China's cotton acreage dipped 10 per cent this year. "This has made India the only destination for cotton procurement, where production is estimated to be 290 lakh bales in 2009-10," said Kishor Shah of Central Gujarat Cotton Dealers Association.
- Some observers had expected an estimated record U.S. crop, harvesting of which is drawing to a close, to dampen soy, but the Chinese buying and doubts over the South American crop due early next year have buoyed the market.
- The anti-dumping duties imposed by the European Union on low price U.S. biodiesel imports in March this year, because of claims they were unfairly subsidised, had not helped German biodiesel producers. U.S. biodiesel shipments to the EU were largely said to be re-exports from Argentina. Shipments were now being made directly from Argentina to Europe.
- Domestic Rabi oilseeds area so far been covered on 68.37 lakh hectare against 72.29 lakh hectare during corresponding period a year ago, as on November 19, 2009. The area under Rapeseed/Mustard Seed is reported down at 54.45 lakh hectare against 56.25 lakh hectare a year ago,Groundnut at 2.06 lakh hectare vs 2.70 lakh hectare and Sunflower sowing is reported at 5.62 lakh hectare against 8.09 lakh hectare in the corresponding period last year.
- Increased fund activity and strong export demand were contributing to the bullish feel, with the USA selling almost 1.5m tonnes of soyabeans in the week ending 12 November - a 58% increase against the previous four-week average. China bought more than half of that tonnage, and was set to import 3.5m tonnes of soya in November against 2.5m tonnes in October, according to the Home-Grown Cereals Authority. In the UK, prices echoed the stronger US and French markets, with the Farmers Weekly ex-farm average up by £5/t in the week to Wednesday (25 November), to almost £233/t for December.
FUNDAMENTAL OUTLOOK
We belive rally in oilseeds complex is overdone as prices are moving far ahead of the fundamentals. We recommend to sell on every rise for the entire complex with exception to Cotton seed oil cake.
