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Agricultural commodities daily review: India and other countries (March 03, 2010)

Contributed by Nirmal Bang

By Nirmal Bang

SPICES COMPLEX

MARKET ROUNDUP
- Spices complex traded mix yesterday. Turmeric ended up on Tuesday as short-covering supported prices. Pepper and Jeera futures traded weak, weighed by fresh arrivals, weak exports and on estimates of higher output this season due to favorable weather in growing regions. Cardamom and Mentha oil traded sideways to up yesterday.

IN FOCUS
- Increase in export of chilli, cardamom and ginger has helped the spices sector record an impressive 18% rise in exports in value terms for January 2010, as compared to the same month of last year.
- In January 2010, around 34,436 tonne of spices valued at Rs 430.00 crore ($93.57 million) was exported as against 30,870 tonne valued at Rs 365.43 crore ($74.83 million) in January 2009.
- The green Gold of Guatemala is Cardamom. 23,000 tones of cardamom are cultivated in Guatemala annually. This makes Guatemala the world's largest exporter. Guatemala's cardamom production sets the prices in the global market. When the production of Cardamom decreases in Guatemala, the prices on the international markets go up.
- Exports of pepper, turmeric and cumin in January 2010 have decreased to 1500, 3250 and 2000 tonnes from 2100, 4200 and 3750 tonnes respectively from same period in 2009.

FUNDAMENTAL OUTLOOK
- We may see some profit taking especially in Turmeric, Pepper and Jeera as rising arrivals and sluggish demand are seen weighing on sentiment. Cardamom and Mentha oil in particular look strong today; buying is recommended.

GUAR, PULSES AND GRAINS COMPLEX

MARKET ROUNDUP
- Chana extended its losses of previous session and plunged by almost 3 per cent in yesterday's trading session tracking weak physical markets. Decreasing for the third day in a row, Wheat futures prices fell by almost 2% on Tuesday on hope of bumper crop this year. Guar complex traded sideways to down yesterday.

IN FOCUS
- "The temperature has gone up during twothree days but not enough to affect the crop till now. However, if it goes up further, wheat output will definitely be affected," Director of Indian Agricultural Research Institute (IARI)
- Wheat on CBOT fell for the third time in four sessions after Iraq bought grain from Russia and Canada, shunning supplies from the U.S., the world's biggest exporter, and as the dollar strengthened.
- A FORECAST jump in world wheat demand won't be enough to trigger the corresponding rise in prices, with world grain prices set to decline over the coming 12 months.
- The spot prices of chana at Delhi mandi pared by Rs 25 per quintal in today's trading with total arrivals of around 25-30 motors. The prices of Delhi mandi were at Rs 2150 per quintal while Maharashtra Chapa chana were FUNDAMENTAL OUTLOOK quoted at Rs 2050 per quintal, down Rs 30.

FUNDAMENTAL OUTLOOK
- Outlook for wheat remains bearish, prices can touch the levels of Rs.1240-50/quintal; selling on rise is recommended. Price of Chana is already over bottomed, we recommend avoiding selling in Chana at this level as prices are expected to move up. Guar may trade sideways to up today.

OIL AND OIL SEEDS COMPLEX

MARKET ROUNDUP
- Oilseed complex witnessed fresh selling yesterday especially in Soy oil, Palm oil and Cottonseed oil cake whereas Soybean traded down on global cues. Cottonseed oil cake ended more than 1 per cent down on weak export demand for cotton.

IN FOCUS
- Argentina's 2010 soybean crop is likely to rise to 52 million tonnes from 32 million tonnes in 2009, Hamburg-based oilseeds analysts Oil World forecast on Tuesday. This was up by 1 million tonnes from Oil World's previous estimate in January. Brazil's 2010 soybean crop is forecast at 65.5 million tonnes from 57.5 million tonnes last year; at the upper end of Oil World's previous forecast of 64 to 65 million tonnes.
- A strong increase in global palm oil exports will cut stocks in coming months despite rising production, Hamburg-based oilseeds analysts Oil World forecast on Tuesday. Global palm oil stocks are likely to fall to 6.68 million tonnes in September 2010 from 6.93 million tonnes in September 2009.
- Soy grains now being harvested in the south of Brazil's top soy state, Mato Grosso, will be smaller than hoped and reduce yields due to overcast skies and too much rain.
- Almost two years to the day after a massive price jump destabilised global cotton markets, the price of cotton is again surging. Cotton's latest surge came after China, the largest producer and consumer of the plant, last week said its 2009 crop fell 14.6 per cent last year to 6.4m tones.
- Cotton production in Australia, the world's fifth-biggest exporter, may rise 30 percent next season, boosted by greater water supply and rising prices. Output may increase to 484,000 metric tons in the year to June 30, 2011, from 371,000 tons this season, the Australian Bureau of Agricultural and Resource Economics said today in a report.

FUNDAMENTAL OUTLOOK
- Outlook for Oilseed complex remains bullish. Soy oil and Palm oil in particular look strong for the day taking clues from the Crude oil prices on international bourses which was 2% law in yesterday's trading session.