Commodities Daily Report

Saturday| August 18, 2012

Agricultural Commodities

Content
News & Market Highlights Chana Sugar Oilseed Complex Spices Complex Mentha Potato

Research Team
Vedika Narvekar - Sr. Research Analyst vedika.narveker@angelbroking.com (022) 2921 2000 Extn. 6130 Anuj Choudhary - Research Associate anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132

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Commodities Daily Report

Saturday| August 18, 2012

Agricultural Commodities
News in brief
Special Margin in Castor seed (CASTORSEED) Contracts
As per a circular dt. 17/08/2012 issued by NCDEX, further Special Margin of 10% (in cash) on the Long side will be imposed on all running contracts and yet to be launched contracts in Castor seed with effect from beginning of day Tuesday, August 21, 2012. (Source: NCDEX)

Market Highlights (% change)

Last Prev. day

as on Aug 17, 2012

WoW MoM YoY

Sensex Nifty INR/$ Nymex Crude Oil - $/bbl Comex Gold - $/oz

17691 5366 55.67 96.01 1616

0.19 0.06 0.09 0.43 0.01

0.74 0.81 0.69 3.38 -0.21

3.42 3.34 1.16 7.61 1.71

5.06 5.78 22.68 10.80 -9.32

Cabinet defers decision on Forward Contract Bill

The government today once again deferred a decision on a Bill that seeks to give more powers to commodity markets regulator FMC as Food and Consumer Affairs Minister K V Thomas was not present in Cabinet meeting. "The Forward Contract Regulation Act (Amendment) Bill has been deferred," a minister present in the Cabinet meeting told reporters. The Cabinet, chaired by Prime Minister Manmohan Singh, did not think it to be prudent to take up the Bill since Thomas was not present in the meeting, sources said. (Source: Business Standard)

Source: Reuters

MP abolishes levy on rice; to implement custom milling of paddy

The Madhya Pradesh Government has decided to abolish the policy of fixed levy on rice and has made amendments for custom milling of paddy. Deadline for custom milling of paddy has been extended from June 30, 2012 to January 31, 2013, an official release said adding efforts will be made to ensure completion of work by identified agencies before the deadline. As per amendments made in the policy, now milling process will be undertaken at market rate without recovering levy from surplus paddy procured or through procurement during next Kharif season. For this, the fixed levy policy has been abolished with effect from the date of implementation of milling rate. (Source: Financial Express)

Rice acreage tops 300 lakh ha as monsoon deficit shrinks

Rice acreage crossed 300 lakh hectares (lh) as transplantation gained momentum in parts of central and North India on widespread rain. States such as Bihar, Chhattisgarh, Madhya Pradesh and Jharkhand have registered higher acreage under the cereal. The pick up in paddy transplanting has largely bridged the deficit in rice acreage that was witnessed in the early parts of the monsoon period. Similarly, acreage under other crops such as cereals, pulses and oilseeds has gone up for the period till August 16. The shortfall in monsoon rains has largely been covered and the deficit now stands reduced to 15 per cent as against 23 per cent in mid-July. About 53 per cent of the countrys total area has received normal or excess rains, while the rest continues to be deficient and scanty. Acreage under kharif pulses such as arhar (tur), urad and moong has improved during the week with Jharkhand, Madhya Pradesh and Uttar Pradesh registering higher area. But acreage in key producing States such as Karnataka, Maharashtra and Rajasthan is still lower. The oilseeds acreage has also been largely made up by soyabean, which has been planted by more farmers in Maharashtra and Madhya Pradesh. The soyabean acreage stood at 106.4 lh (102.2 lh), while groundnut area is less by 5 lh at 35.3 lh. The acreage under coarse cereals is short by 23.7 lh for the period largely on account of poor sowing of bajra, ragi and sorghum. However, the acreage under maize is almost on par with that of last year at close to 70 lh. The acreage under cotton stood at 110 lh, marginally short of last years 116.80 lh for the period. Cane acreage is higher by 2.99 lh than last years 52.88 lh. (Source: Business Line)

Storms moisten Argentine wheat fields after a dry winter

Storms over the last week in Argentina's northern wheat-growing areas have bolstered yield expectations as the world looks to Southern Hemisphere exporters to fill the supply gap caused by a U.S. drought that recently pushed grain prices to new highs. The third grains surge in four years has sparked worries of a possible global nutrition crisis, putting the spotlight on producers such as Argentina, Brazil and Australia, which are in or entering their spring planting seasons for wheat, corn and soybeans. A dry winter and light sowing by farmers irked by government export curbs have brought Argentina's 2012/13 wheat output expectations to lows not seen in years. But the nearly constant rains that have lashed the northern Pampas farm belt over recent days have raised expectations for healthy yields in the areas that have been planted. Argentina hopes to benefit from rains associated with the El Nino phenomenon in the upcoming season. (Source: Reuters)

Midday update shows dryness returning to US crops

Midday weather updates on Friday indicated little shift from earlier outlooks for dry weather to return to the drought-stricken U.S. Midwest crop region, agricultural meteorologists said. They said the showers this week as corn and soybeans neared the end of their growing season were too little too late to greatly revive crop prospects. "There were some decent rains in central Illinois and west central Indiana yesterday, but it's too late for corn and too late for most of the bean crop," said Don Keeney, meteorologist for MDA EarthSat Weather. There has not been enough rain to end the historic drought, and now it appeared there would be a return to drier weather. "It looks like a dry weekend and dry next week, there could be some rain in the last week of August," he said.
(Source: Financial Express)

North, extreme south to make rain gains next week

Global model predictions favour enhanced probability of above average rainfall for north India during the week ending August 21. Adjoining plains of the foothills of the Himalayas are expected to receive heavy to heavy rainfall variously during this period. The northeastern states, Bihar, Uttar Pradesh, Punjab, Delhi, Haryana north and adjoining west Rajasthan may receive varying amounts of rain. Rains are also indicated for the southernmost peninsula, especially Kerala, during this phase. A warning valid for the next two days said that heavy to very heavy rainfall would occur at one or two places over Kerala and coastal Karnataka during next two days. Heavy rainfall has been forecast also at one or two places over Odisha, Chhattisgarh and Lakshadweep during this period. An extended outlook valid until Friday next said that fairly widespread rainfall would occur over Jammu and Kashmir, Himachal Pradesh and Uttarakhand. Rain has also been forecast at many places over the Northeastern States, Central India and the Indo-Gangetic plains. (Source:
Business Line)

Brazil government, banks may bump up loans to stock coffee

Brazil's government and private banks look set to boost lending to coffee producers, the national coffee producers' association, CNC, said on Friday, to tide them over when they choose to defer sales in the hope of receiving a higher asking price later. The CNC said that the government would vote at the end of August about adding 600 million reais ($297.10 million) to its Funcafe coffee loan program that would take its total funds this season to 1.8 billion reais. The association said private lenders had also expressed an interest in allocating more loans to coffee producers and estimated an additional 1.2 billion reais could be made available.
(Source: Reuters)

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Commodities Daily Report

Saturday| August 18, 2012

Agricultural Commodities
Chana
Chana September futures made a new high of Rs 5010 on Friday account of supply shortage of this pulses crop and higher demand ahead of festive season. However, prices witnessed correction and settled lower by % owing to expiry of August contract. Final Settlement price of August contract as declared by the exchange was Rs 4932.50 per qtl. Monsoon is seen recovering gradually in the month of August reveals the th latest report from IMD, wherein monsoon as on 16 August 2012 were seen 15% below normal. Central, southern and northwest region has received good rains in the last 2 weeks. This has aided sowing in the last one week. Also this may prove beneficial for the chana sowing. The Cabinet Committee on Economic Affairs approved the Minimum Support Prices (MSP) for Arhar (Tur) and Moong for 2012-13 season. The MSP for Arhar has been fixed at Rs.3850 per quintal and of Moong at Rs.4400 per quintal marking an increase of Rs.650 per quintal and Rs.900 per quintal respectively. Government released fourth advance estimates wherein it revised upward Chana output at 7.58 mn tn from 7.4 mn tonnes estimated in the third advance estimates and 8.22 mn tn in 2010-11.

Market Highlights
Unit Rs/qtl Rs/qtl Last 4971 4875 Prev day 0.89 0.06

as on Aug 17, 2012 % change WoW MoM 1.44 0.42 3.33 -0.02 YoY 50.63 47.46

Chana Spot - NCDEX (Delhi) Chana- NCDEX Aug '12 Futures

Source: Reuters

Technical Chart - Chana

NCDEX Sept contract

Sowing progress and demand supply fundamentals

According to the Ministry of Agriculture 85.32 Lakh hectare area has th been planted under Kharif pulses as on 17 August, 2012 compared to 97.38 lakh hectare (ha) same period last year, a decline of 12.4% . Sowing is reported lower mainly in Rajasthan. Rajasthan Agriculture Department states that planted area under Kharif Pulses is down at 15.33 lakh hectares ha compared to 24.14 lakh ha same th period last year. (Dated 17 August, 2012). Sowing which was down by more than 55% has gained momentum after improvement in rainfall in the last one week and is now down by 35%. In Maharashtra, Kharif Pulses sowing is down by 7% at 18.63 lakh hectares. While in AP it is up by 5% at 6.98 lakh hectares. According to the Fourth advance estimates, Pulses output is pegged at 17.21 mn tn in 2011-12 compared with 18.24 mn tn produced in the year 2010-11. While Chana output in 2011-12 is estimated at 7.58 million tones, Tur is estimated at 2.65 million tones, Urad is estimated at 1.83 million tones, Moong is estimated at 1.71 million tones. As per the latest release, Ministry of Commerce & Industry revealed that 20.23 lakh tones of peas, 2.03 lakh tons of Chana, 4.32 lakh tons of Urad & Moong, 1.12 lakh tons of Masoor and 4.26 lakh tons of Tur has been imported by India during April11-March 12. India's consumption of pulses is on the rise with an annual growth of around 5% but production is seen lower, which may lead to increase in imports this year. However, rupee weakness may turn import costlier. Around 74% of Indian chickpea imports come from Australia.

Source: Telequote

Technical Outlook
Contract Chana Sept Futures Unit Rs./qtl

valid for Aug 18, 2012 Support 4875-4905 Resistance 4975-5010

Outlook
Chana prices may trade on a positive note taking cues from the physical markets that are trading higher amid lower supplies and strong demand ahead of festive season. However, improved rains may cap sharp upside in the prices. In the medium term to long term, the trend remains positive as supplies may not be sufficient to meet the rising demand of the commodity. Also lower sowing of kharif pulses may support chana prices.

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Commodities Daily Report

Saturday| August 18, 2012

Sugar

Agricultural Commodities
Market Highlights
Unit Sugar Spot- NCDEX (Kolkata) Sugar M- NCDEX Aug '12 Futures Rs/qtl Last 3673 as on Aug 17, 2012 % Change Prev. day WoW 0.07 -6.44 MoM 4.94 YoY 22.43

Sugar September futures that declined initially taking cues form sufficient supplies in the domestic markets, gained towards the end tracking higher quotes in the physical markets amid expiry of near August contract. The final settlement of August contract as disclosed by the NCDEX stands at Rs 3534 per qtl, while Kolhapur Spot is trading around Rs 3500 per qtl. Industry body has estimated 7 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may exports 2.53 mn tn sugar in 2012-13. India will likely produce 25 million tonne of sugar in 2012-13 factoring in dry spells in biggest producer Maharashtra as well as Karnataka. The Central Government has released additional 4 lakh ton of non-levy sugar for the month of August, 2012. With the earlier release of 45 lakh ton in June and 2.66 lakh ton in July the total 51.66 lakh ton non-levy sugar will be available. In the international markets, Raw sugar futures on ICE closed lower for the 13th straight session on Thursday, ending at an eight-week low. Liffe white sugar as well as ICE raw sugar settled 1.03% and 0.69% lower Thursday. With international prices trading at such low levels, the exports from India is not viable as domestic prices being quoted much higher.

Rs/qtl

3538

0.88

0.68

5.45

28.65

Source: Reuters

International Prices
Unit Sugar No 5- LiffeOct'12 Futures Sugar No 11-ICE Oct '12 Futures $/tonne $/tonne Last 559.5 448.44

as on Aug 17, 2012 % Change Prev day WoW 0.00 0.15 -3.28 -2.70 MoM -10.44 -12.07 YoY -29.93 -34.46

Source: Reuters

Domestic Production and Exports

As on 9 August, 2012, the area under sugarcane is estimated at 52.88 lakh ha, up from 50.59 lakh ha on same period a year ago. Despite of higher acreage, the producers body has estimated next years output lower at 25mn tn, down by 1mn tn compared to the current year. Sugar production in India the worlds second-biggest producer touched 26 million tonne since October 1, 2011. IMD has so far predicted normal rains in August. However, rains in the first week of august are still 1% below average. If monsoon recover in the month of August, then there would not be much downward revision in the output and vice a versa. With the opening stocks of 7 mn tn, domestic Sugar supplies are estimated at 32mn tn against the domestic consumption of around 22.523 mln tn for 2012-13. Thus, no curbs on exports are seen as of now.
th

Technical Chart - Sugar

NCDEX Sept contract

Global Sugar Updates

According to Unica, the 2012/13 sugarcane crop is seen at 596.6 mn tn, down 1 percent from the April estimate of 602.18 mn tn, according to the second estimate of the crop this season from the agriculture ministry's supply agency Conab. Despite the drop in the cane crop estimate from April, sugar output -- now forecast at 38.99 mn tn -- is virtually stable with the 38.85 million tonnes forecast four months ago. The global sugar surplus remains on target to fall in 2012/13 season, though declines will be less than previously suggested, while adverse weather in several producers may stop prices dropping far below recent levels. (Source: Reuters) According to the International Sugar Organization (ISO), the global sugar surplus is forecast to halve to around 3 mln tn in 2012/13 (OctoberSeptember) from a surplus of 6.5 million tonnes in 2011/12).

Source: Telequote

Technical Outlook
Contract Sugar Sept NCDEX Futures Unit Rs./qtl

valid for Aug 18, 2012 Support 3385-3410 Resistance 3470-3490

Outlook
Sugar prices are expected to remain firm taking cues from the spot markets that are quoting at higher rates compared to September futures Medium term outlook for sugar would depend on the monsoon in the current month and in September and thereby output estimates for next season that will begin in October.

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Commodities Daily Report

Saturday| August 18, 2012

Agricultural Commodities
Oilseeds Soybean:
Soybean futures declined marginally on account of higher acreage and improved rains in the last 2-03 weeks. However, sharp gains were capped on reports of El nino weather pattern developing, which may hamper palm oil output in the top nation. CBOT Soybean settled higher by 0.89% on Friday as cash markets firmed amid slow farmer selling and expectations of continued demand from exporters as well as domestic soy processors, despite near-record high prices. Markets had a strong (monthly U.S.) crush report and another strong week of export sales yesterday. th According to the USDA Weekly crop progress report as on 13 Aug, the condition of Soybean has improved to 30% Good to Excellent from 29% a week ago. USDA released its monthly crop report wherein its cut U.S. 2012/13 soybean production forecast to 2.692 billion bushels, from 3.05 billion in July. India's oil meal exports fell to 2.75 lakh tn in July from 2.82 lakh tn a year earlier led by a sharp drop in the overseas sales of rapeseed meal. Soy meal exports rose to 1.68 lakh tn in July, from 1.39 tn a year ago. In the domestic markets, as on 17 August Oilseeds have been sown in 160.77 lakh hectares so far, compared with 167 lakh hectares same period last year. Soybean area is higher at 106.4 lakh hectares. In 2011-12 season, soybean was sown under 102.9 lakh hectares area and recorded 12.28 million tonne output, down from 12.73 mn tn in 2010-11 season.
th

Market Highlights
% Change Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Aug'12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soyoil- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 4506 4509 778.8 777.5 Prev day -0.07 0.03 0.12 -0.24

as on Aug 17, 2012

WoW -1.70 -2.68 0.68 0.62

MoM -8.80 -10.98 -1.76 -4.19

YoY 90.13 89.23 18.42 18.35

Source: Reuters

as on Aug 17, 2012 International Prices Soybean- CBOTAug'12 Futures Soybean Oil - CBOTAug'12 Futures Unit USc/ Bushel USc/lbs Last 1671 53.11 Prev day 0.89 0.13 WoW -2.25 -0.91 MoM 1.35 -2.03
Source: Reuters

YoY 21.13 -7.31

Crude Palm Oil

% Change Unit
CPO-Bursa Malaysia Aug '12 Contract CPO-MCX- Aug '12 Futures

as on Aug 17, 2012

Last 2898 554.9

Prev day 1.33 0.00

WoW 2.40 0.85

MoM -2.42 -4.34

YoY -14.76 12.95

Refined Soy Oil: NCDEX Soy Oil & MCX CPO settled lower on Friday
taking cues from the weak domestic oilseeds prices. India imported 112,611 tonnes of refined palm oil in July, down 9.28 percent from June. Total vegetable oil imports in July were 870,328 tonnes, up from 783,315 tonnes in the previous month (Source: Sea of India). Malaysian palm oil Production has risen consistently since March 2012 and expected to go as high as 1.9 mn tn in September. On the other hand, exports have fallen 14.8 percent in July to below 1.23mn tonnes compared to 1.45mn tonnes a month ago due to a lull in Asian demand. Although, Malaysia's July palm oil stocks rose 17.6 percent to 1,998,870 tn from a revised 1,699,117 tn in June, the development of El nino pattern might hamper palm oil yield and support the upside in the prices. Indonesia, the world's top palm oil producer, has lowered its earlier output forecast by 8 percent to 23.6 million tonnes this year

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Aug '12 Futures Rs/100 kgs Rs/100 kgs Last 4318 4376 Prev day -0.31 -0.18

as on Aug 17, 2012 WoW 2.80 2.24 MoM 0.70 -1.08

Source: Reuters

YoY 47.86 50.84

Technical Chart Soybean

NCDEX Oct contract

Rape/mustard Seed: NCDEX September mustard seed prices

declined marginally by 0.18% tracking weak physical markets. Mustard August expiry settled at 4500 per qtl whereas jaipur spot is trading around 4320 levels. Mustard output this season has declined significantly and deficient rains in Rajasthan would not provide proper moisture for mustard sowing next season. This would keep the downside restricted. According to a circular issued by NCDEX, existing Special Cash Margin of 5% on the Long side shall be increased to 15% on all the running and yet to be launched contracts w.e.f beginning of 18/07/2012.

Source: Telequote

Outlook
Oilseed complex may declined taking cues from lower quotes in the spot markets. However, sharp downside may be capped amid firm international markets. Sentiment remains cautious on possibility of an El Nino returning to Southeast Asia that could hamper output in top producers Indonesia and Malaysia.

Technical Outlook
Contract Soy Oil Sept NCDEX Futures Soybean NCDEX Oct Futures RM Seed NCDEX Sept Futures CPO MCX Sept Futures Unit Rs./qtl Rs./qtl Rs./qtl Rs./qtl

valid for Aug 18, 2012 Support 782-786 3380-3925 4375-4405 548-552 Resistance 796-801 4000-4030 4465-4500 559-562

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Commodities Daily Report

Saturday| August 18, 2012

Agricultural Commodities
Black Pepper
Pepper Futures corrected sharply in the August contract on Friday due to the expiry. The prices also corrected on reducing demand for Indian pepper in the international markets due to huge parity. Many countries are importing pepper from Brazil and Indonesia than from India due to lower prices offerings from them. The Spot as well as the Futures settled 1.28% and 2.31% lower on Friday. th According to the circular released on June 13 2012 the existing Special margin of 10% (cash) on the long side stands withdrawn on all running contracts and yet to be launched contracts in Pepper from beginning of day Friday June 15, 2012. Pepper prices in the international market are being quoted at $8,150/tonne(C&F) while Vietnam was offering its produce at $6,000/tonne for 500 GL. Brazil was offering its pepper at $6,150/tonne for the B-Asta grade. As per circular dt. 29/06/2012 issued by NCDEX, Hassan will be available as an additional delivery centre for all the yet to be launched contracts. (not applicable to the currently available contracts-till Dec 2012 expiry).

Market Highlights
% Change Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 41856 42645 Prev day -1.28 -2.31

as on Aug 17, 2012 WoW -1.74 -3.04 MoM -0.61 -1.46 YoY 30.20 29.18

Source: Reuters

Technical Chart Black Pepper

NCDEX Sept contract

Exports
According to Spices Board of India, exports of pepper in April 2012 fell by 47% and stood at 1,200 tonnes as compared to 2,266 tonnes in April 2011. India imported 1,848 tonnes of pepper till March 2012 and has become the third country to import such large quantity after UAE and Singapore. (Source: Agriwatch) According to Vietnam Ministry of Agriculture and Rural Development (MARD) exports of black pepper in 2012 are forecasted at around 1,25,000 tonnes. Exports of Pepper from Vietnam during January till June 2012 is estimated around 73000 mt 73,000 mt, higher by 4.3% in volume and 31.7% in value compared to corresponding year last year. Exports of Pepper from Brazil during January till May 2012 are estimated around 13369 mt. (Source: Peppertradeboard). Pepper imports by U.S. the largest consumer of the spice declined 14.8% in the first 2 months of the year (2012) to 8810 tn as compared to 10344 tn in the same period previous year. Imports of Pepper in the month of February declined by 16.8% to 3999 tn as compared to 4811 tn in the month of January 2012. Exports from Indonesia posted significant decrease of 42% as compared to previous year. Exports stood at 36,500 tonnes as compared to 62,599 tonnes in the last year. During May 2012 Brazil exported 1,705 tonnes of pepper as against 1600 tn in May 2011.

Source: Telequote

Technical Outlook
Contract Black Pepper NCDEX Sept Futures Unit Rs/qtl

valid for Aug 18, 2012 Support 41350-41780 Resistance 42600-42850

Production and Arrivals

Arrivals of pepper in domestic market stood at 16 tonnes while offtakes were 14 tonnes on Thursday. 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%. According to latest report pepper output in Vietnam is estimated to be 1.35 lakh tonne as compared to 1.10 lakh tonne estimated early in the beginning of year (2012). Domestic consumption of Pepper in the world is expected to grow by 3.03% to 1.25 lakh tonnes while exports are likely to grow by 1.48% to 2.46 lakh tonnes in 2012. (Source: Pepper trade board) On the other hand production of pepper in India in 2011-12 is expected to decline further by 5% to 43 thousand tonnes as compared to 48 thousand tonnes in the last year. Production is lowest in a decade.

Outlook
Pepper prices in the intraday trade lower. Lower demand for Indian Pepper in the international market may pressurize the prices. However, lower inventories and stocks in the domestic markets may support prices at lower levels.

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Commodities Daily Report

Saturday| August 18, 2012

Agricultural Commodities
Jeera
Jeera Futures opened in the positive yesterday, but corrected towards the end of the day due to profit booking as the prices gained over the last three days. However, the spot traded on a positive note due to lower arrivals as farmers are reluctant to sell their stocks at lower prices. Also, improving overseas sales have lent support to the prices. Supply concerns from Syria and Turkey still exists. The Spot settled 0.55% higher while the Futures settled 0.41% lower on Friday. Expectations are that large export orders may be diverted to India from the international markets due to the ongoing civil war in Syria which is hampering supplies. There are reports that there has been an increase in demand from Bangladesh for Indian Jeera. Production in Syria and Turkey is being reported around 17,000 tonnes and around 5,000 tonnes, lesser than expectations. Jeera prices in the international market of Indian origin are being offered at $3,0003,025/tn (c&f) while Syria and Turkey are not offering their produce. Carryover stocks of jeera in the domestic market is expected to be around 7-8 lakh bags as compared to 4-5 lakh bags in the last year.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 16330 15908 Prev day 0.55 -0.41

as on Aug 17, 2012 % Change WoW 0.22 0.90 MoM 2.40 -1.62 YoY 4.60 2.35

Source: Reuters

Technical Chart Jeera

NCDEX Sept contract

Production, Arrivals and Exports

Unjha markets witnessed arrivals of 5,000 bags, while off-takes stood at 5,000 bags on Friday. Production of jeera in 2011-12 is expected to be around 40 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 in April 2012 stood at 2,500 tonnes as compared to 2,369 tonnes in April 2011, an increase of 6%.

Source: Telequote

Outlook
Jeera prices are expected to trade sideways to positive today. Prices may improve due to lower arrivals at lower prices. However, rains in Gujarat may cap any sharp upside. In the medium to long term (AugSeptember 2012) prices are likely to witness a bounce back as there are limited stocks with Syria and Turkey and crop there is 30% short as compared to last year.

Market Highlights
Prev day 0.00 -3.34

as on Aug 17, 2012 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Sept '12 Futures Rs/qtl Rs/qtl

Last 5447 5848

WoW -0.61 4.17

MoM 9.44 -1.28

YoY -7.60 13.82

Turmeric
Turmeric prices corrected yesterday due to lack of orders from north India. The spot remained closed due to Amavasya. Rainfall in Nizamabad is 29% lower than the normal as on 14/8/2012. Turmeric th has been sown in 0.47 lakh hectares in A.P as on 14 August 2012. The Futures settled 3.34% lower on Friday. As per circular issued by NCDEX, no fresh positions will be allowed in respect of Turmeric August 16, 2012 expiry contract from August 07, 2012 till the expiry of the contract. Only squaring up of existing positions will be allowed. The pre expiry margin on Turmeric has been increased to 5% for last 7 trading days increased on a daily basis on both buy and sell side from the existing 3% on daily basis for last 5 days.

Technical Chart Turmeric

NCDEX Sept contract

Production, Arrivals and Exports

Arrivals in Erode mandi stood at 6,000 bags on Friday. Turmeric production for the year 2011-12 is projected at historical high of 90 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 201011. Erode is expected to produce 55 lakh bags of turmeric a rise of 29% as compared to previous year. According to Spices Board of India, exports of Turmeric in April 2012 increased by 1% at 7,300 tn as compared to 7,230 tn in April 2011.

Source: Telequote

Technical Outlook
Unit Jeera NCDEX Sept Futures Turmeric NCDEX Sept Futures Rs/qtl Rs/qtl

valid for Aug 18, 2012 Support 15900-16050 5660-5760 Resistance 16380-16510 5950-6020

Outlook
Turmeric prices are expected to continue to trade sideways. Reports of export demand from Pakistan may lend support to the prices. However, good stocks as well as lower demand from north India may cap sharp upside. In the medium to long term (Aug to September) prices may take cues from the sowing figures.

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Commodities Daily Report

Saturday| August 18, 2012

Agricultural Commodities
Mentha Oil
Mentha oil Futures traded on a sideways note yesterday. The spot traded lower due Gutkha ban and lower export demand over the last couple of days. The spot as well as the Futures settled 0.11% and 0.71% lower on Friday. Total Special Cash margin of 25% on the long side of Mentha Oil has been reduced to 10% in the May contract and 5% in June contract onwards from May 5, 2012. For detailed reference please refer to the Circular No: MCX/T&S/180/2012 dated 03/05/2012.

Market Highlights
Unit Mentha Oil- MCX Spot (Chandausi) Mentha Oil MCX July Futures Rs/qtl Rs/qtl Last 1515 1328 Prev day -0.11 -0.71

as on Aug 17, 2012 % Change WoW -1.34 -4.39 MoM 2.02 0.26 YoY 22.60 7.49

Production, Arrivals and Exports

According to spot market sources, the overall acreage is estimated to increase from 1.75 lakh ha to 2.1 lakh ha this year. The overall production of Mentha is expected to increase by 30% - 40% as compared to last year. Arrivals of the fresh crop are going on in the mandis and currently stand around 1200 drums (each drum weighs 180 kgs). Exports of Mentha during April 2011 to January 2012 witnessed a decline of 6% to 12,850 tonnes as compared to 13,550 tonnes in the same period last year.

Source: Reuters

Technical Chart Mentha Oil

MCX Aug contract

Outlook
In the intraday trading session Mentha oil is expected to trade sideways. Lower export demand may pressurize prices. However, buying at lower levels may emerge from stockists anticipating good demand from pharmaceutical companies in the coming days. In long to medium term (July-September) prices are likely to remain under pressure due to peak arrival period.

Source: Telequote

Market Highlights
Prev day -0.21 -0.08

as on Aug 17, 2012 % Change

Potato
Potato September futures corrected sharply and settled 3% lower (September contract) due to good supplies from cold storages. Commodity market regulator Forward Markets Commission (FMC) has banned launch of new Tarkeshwar potato contracts. Also From 01-08-2012 no fresh positions shall be allowed during the Staggered Delivery period in all running contracts of Potato in MCX and NCDEX. Only squaring off of existing positions will be allowed during the Staggered Delivery period.
Unit Potato SpotNCDEX (Agra) Potato- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 1162 1180

WoW -1.86 -0.50

MoM 1.53 -6.29

YoY 175.18 221.35

Technical Chart Potato

NCDEX Sept contract

Production and Arrivals Scenario

Around 200-220 lakh MT potato had been stored in the country in different cold storages during the current season. Although 27-30% of the cold storage stocks are released so far from overall producing belts, they are much lower compared to normal 35-38% every year. According to NHRDF, The sowing of potato seed for Kharif production in Karnataka completed but the area sown is adversely affected due to less and delayed rains. The sowing in hills of Himachal Pradesh, Uttarakhand and Jammu and Kashmir are also completed. The seed sowing in Maharashtra for Kharif is continued, which is delayed due to delay arrival of monsoon, which is still scanty. The area for Kharif is expected to be less or may be same with delayed planting compared to last year, but it depends on further rains. With reports of crop damages in Karnataka, the supplies from this region to other states may also be affected as the overall output is expected to decline by 70-75%. In fact, the state may have to rely on the supplies from the north Indian markets.

Source: Telequote

Technical Outlook
Unit Mentha Oil Aug Futures Potato NCDEX Sept Futures Potato MCX Sept Futures Rs/kg Rs/qtl Rs/qtl

valid for Aug 18, 2012 Support 1309-1318 1136-1145 1155-1172 Resistance 1343-1352 1172-1194 1205-1220

Outlook
Potato futures in intraday may trade sideways on lack of fresh fundamentals to trigger the prices. Also, the participants fear that the government may take some measures to curb the rising prices. Upcoming festive season might provide support to the prices in Medium term.

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