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Agricultural commodities daily review: India and other countries (March 04, 2010)

Contributed by Nirmal Bang

By Nirmal Bang

SPICES COMPLEX

MARKET ROUNDUP
- Spices complex witnessed an upside trade yesterday in all the Spices. Cardamom, Mentha oil, Pepper, Jeera and Chili ended up on short covering. Turmeric too ended up supported by low carryover stocks.

IN FOCUS
- Indian pepper exports in January stood at 1,500 tonnes, down 28.57 percent on year, the Spices Board said. India's pepper output in 2010 is expected around last year's levels, but prices are unlikely to fall sharply in coming months due to low carry-over stocks.
- Prices are weak due to increasing arrivals. Daily inflow at the Unjha spot market has increased to 20,000 bags with the season entering into the peak period. Jeera exports in January 2010 dropped by 46.66 percent to 2,000 tonnes on year, the Spices Board said.
- Turmeric exports in January 2010 stood at 3,250 tonnes, down 22.61 percent from a year ago, the Spices Board said.
- 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.

FUNDAMENTAL OUTLOOK
- We recommend selling on rise in Jeera and Turmeric on the back of higher arrivals in the physical market. But cardamom and Mentha oil looks strong today; Buying at dips is recommended.

GUAR, PULSES AND GRAINS COMPLEX

MARKET ROUNDUP
- Wheat futures pared its losses on Wednesday on the back of decreased arrivals in the physical market. Guar complex ended high on hopes demand for guar gum will increase in the coming months. Chana too rose by almost 1% on bargain-buying yesterday.

IN FOCUS
- Chana arrivals are 6000-7000 bags at Delhi's Lawrence Road Mandi. The Spot price is expected to open at Rs.2150-2160/quintal, Rs.15/quintal higher than the prices on previous day's trading session.
- "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)
- US Wheat Associates was critical of Australia's former export monopoly, and lobbied strong for investigations into the AWB Oil-for-Food scandal.
- U.S. exporters shipped 15.5 million tons of wheat from June 1 through Feb. 18, down 23 percent from the same period a year earlier, Department of Agriculture data show. The dollar rose as much as 0.8 percent against a basket of six major currencies today before paring gains. The U.S. currency gained 5.7 percent this year against the euro through yesterday.
- Global wheat production may decline by 2.37 per cent to 659 million tonnes in 2010, while output in India, the world's second-largest producer of the grain, is expected to remain stable at last year's level. "Assuming the trend yields, production is projected at 659 MT, six million tonnes more than in January, but still 16 MT short of the 2009 total," the London-based International Grain Council (IGC) said in its latest Grain Market Report.

FUNDAMENTAL OUTLOOK
- Wheat is expected to extend its downside rally weighed by hope of record harvest. Outlook chana remains bullish; buying at dips is recommended. Guar may trade sideways to down today.

OIL AND OIL SEEDS COMPLEX

MARKET ROUNDUP
- Oilseed complex traded in green territory on Wednesday tracking the international markets. Soy bean and Soy oil rose over 1% on profit booking. Cottonseed oil cake traded steady in yesterday's trade.

IN FOCUS
- China's soyoil imports were likely to increase to between 200,000-250,000 tonnes in April and May each month, up from about 60,000 tonnes projected for March, according to an official grain think-tank.
- Palmoil imports were seen steady at between 500,000 to 600,000 tonnes each month from April to June, it said. But stocks remain high or at about 500,000 tonnes as of the end of February.
- China cannot produce enough vegetable oil and has to import every year, and it is already the world's largest importer of soybeans. China imports soyoil mainly from South America and palmoil from Indonesia and Malaysia.
- Cash palm oil prices will keep their discount to South American soyoil well below $100, driven by stronger vegetable oil demand as soyoil supply growth will be limited. Argentine soyoil now retails at $845 a tonne free on board (FOB), just $30 higher than Malaysian refined palm oil in -- the limit to which the discount would narrow to, the head of German-based Oil World Thomas Mielke said.
- 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 today due to global cues. Soy oil and Palm oil in particular look strong; buying at dips is recommended.