Agricultural Commodities
Content
News & Market Highlights Chana Sugar Oilseed Complex Spices Complex Kapas/Cotton
Research Team
Vedika Narvekar - Sr. Research Analyst vedika.narvekar@angelbroking.com (022) 2921 2000 Extn. 6130 Anuj Choudhary - Research Analyst anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132
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Agricultural Commodities
News in brief
Coffee exports dip over 8% on weak global prices
Indias coffee exports declined by over a eight per cent to 0.3 million tonnes ( mt) till November of the current calendar year impacted by weak global prices as a result of higher supplies, according to the Coffee Board. The country had shipped 0.32 mt of the bean in the corresponding period last year, its said. Global demand remained firm but less lucrative price curbed shipments despite ample domestic availability for the export purpose, he added. During the January- November period of this year, the country shipped 0.30 mt of coffee, of which robusta and arabica varieties stood at 0.15 mt and 56,018 tonnes, respectively, according to data released by the Board. (Source: Business Standard)
as on Dec 3, 2012
WoW MoM YoY
Sensex Nifty INR/$ Nymex Crude Oil - $/bbl Comex Gold - $/oz
.Source: Reuters
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Agricultural Commodities
Chana
Chana futures extended the losses of the previous session and settled lower by almost 1.6% during the first trading session of the week. Improved sowing of Rabi pulses, subdued demand and higher imports is seen pressurizing Chana prices. Total pulses acreage as on 30th November is down by 6.4% to 102.49 lakh ha from 109.56 lakh ha last season. Acreage was down by almost 17% till the week ended 16th Nov and by 7% till the previous week thus showing marginal recovery in the sowing. In Maharashtra Chana acreage is up by 31% at 7.03 lakh ha as on 30th th Nov 2012. While in AP it is up by 22.8% at 5.22 lakh ha as on 28 Nov. However, in Rajasthan, sowing is down by 19.2% at 12.18 lakh ha as on th 30 Nov. Except for Wheat, minimum support price of all other Rabi crops has been increased by CCEA for 2012-13 season. MSP of Chana/Gram is raised by Rs 400 per qtl for 2012-13 season to Rs 3200. Higher returns and favorable soil condition will definitely boost acreage in the coming season. The Commission for Agriculture Costs and Prices (CACP) has suggested 10 per cent import duty on pulses to encourage domestic production. in the first six months of the new fiscal that is from April to September this year, imports were an estimated 12 lakh tonnes.
Market Highlights
Unit Rs/qtl Rs/qtl Last 4130 4029 Prev day -4.05 -1.59
as on Dec 3, 2012 % change WoW MoM -6.67 -8.74 -5.18 -11.57 YoY 33.88 33.54
Source: Reuters
Source: Telequote
Technical Outlook
Contract Chana Jan Futures Unit Rs./qtl Support
3920-3975
Outlook
After declining sharply in the past few sessions, chana futures may recover in the early part of the session. However, sentiments remain weak and selling at higher levels is suggested for the intraday. Expectations of ease in supplies amid higher shipments coupled with subdued demand will keep bearishness intact. Prices may also take cues from sowing progress of Rabi pulses which is expected to gain momentum in the coming days.
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Agricultural Commodities
Sugar
Sugar futures declined on Monday on account of sufficient supplies in the domestic as well as global markets. Sugar production has marginally declined to 23.30 lakh tn in the first two months of the 2012-13 marketing year that started in October against 23.92 lakh tonnes in the year-ago period, industry body ISMA said. In a move to curb any further spike in sugar prices considering lower sugar production for the marketing year 2012-13, Government has allocated total 70 lac tons of non-levy sugar quota for Dec-March 201213 period which is higher from 59.5 lac tons sugar quota allocated by government last year same period . Out of total 70 lac tons, Government released 66 lakh tn non-levy sugar quota and 2 lakh tn levy conversion sugar quota. Also, there is an extension of around 2 lakh tn from Oct, 2012 - Nov, 2012 which the millers have to release upto 10th December, 2012. Liffe white sugar and ICE sugar settled higher by 1.41% and 2.12% respectively on Monday on account of short covering and weak Dollar.
Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Dec '12 Futures Rs/qtl Last 3422
as on Dec 3, 2012 % Change Prev. day WoW -0.13 -0.12 MoM -1.64 YoY 9.18
Rs/qtl
3280
-0.33
-0.30
-3.16
10.14
Source: Reuters
International Prices
Unit Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 523.4 438.89
as on Dec 3, 2012 % Change Prev day WoW 1.41 2.12 2.75 3.13 MoM -2.82 1.91 YoY -16.18 -17.98
.Source: Reuters
Source: Telequote
Technical Outlook
Contract Sugar Jan NCDEX Futures Unit Rs./qtl Support
3265-3280
Outlook
Sugar prices may remain range bound as sufficient supplies available may offset the positive markets sentiments caused by delay in cane crushing in UP. International markets may continue to trade with downward bias on account of global supply glut.
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Agricultural Commodities
Oilseeds
Soybean: Soybean December futures rebounded after a sharp fall
on Saturday on account of short coverings. However, spot continued to decline on Monday. Arrivals remained at around 4.5 lakh bags on Monday. However, demand from solvent extractors also remained strong. According to first advance estimates, Soybean output is pegged at 126.2 lakh tn for 2012-13.
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Dec '12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Dec '12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3165 3151 733.7 720.5
Market Highlights
as on Dec 3, 2012 % Change Prev day -1.49 1.43 -0.18 1.42 WoW -3.71 -3.36 -1.33 -1.26 MoM -5.15 -5.62 4.29 5.35 YoY 42.95 40.27 16.49 13.30
International Markets
CBOT soybean settled higher by 1.41% on Monday on long liquidation and profit-taking, along with forecasts for welcome rains in crop areas of Brazil. Net sales of 319,100 MT for the 2012/2013 marketing year were down 41 percent from the previous week and 37 percent from the prior 4-week average. Beneficial rains are expected in Brazil's southern grain belt over the weekend, boosting crop prospects after the main corn and soy region received far less rain than usual in November. December will start with more concentrated rains over Brazil's center and south. Growers advanced seedings by 11% points during the week through Thursday, covering 58% of the 19.4 mn ha expected to be sown this season. Although, the rate of planting picked up as the weather moderated after the Pampas was lashed by harsh August-October storms, it is still 8% below last years level. The Argentine could produce 55 million to 58 mn tn of soybeans this th season if the weather cooperates. Brazil's government on 8 Nov 2012 edged up its forecast for a record 2012-13 soybean crop to between 80.1 and 83 mn tn.
Source: Reuters
as on Dec 3, 2012 International Prices Soybean- CBOTJan'13 Futures Soybean Oil - CBOTDec'12 Futures Unit USc/ Bushel USc/lbs Last 1454 49.9 Prev day 1.04 0.99 WoW 2.04 1.28 MoM -6.72 -1.05
Source: Reuters
as on Dec 3, 2012 % Change Prev day WoW -2.05 -0.05 -7.24 -2.93
Unit
CPO-Bursa Malaysia Dec '12 Contract CPO-MCX- Dec '12 Futures
MYR/Tonne Rs/10 kg
Refined Soy Oil: Ref soy oil recovered marginally while CPO
declined sharply as the top analysts warned that record high stocks would weigh on prices in the New Year. But losses were limited by a surprise increase in Malaysian exports that rose to 1.66 mn tn in November from October's 1.61 mn, cargo surveyor Intertek Testing Services said on Friday. Dorab Mistry, head of edible oils trading, Godrej is predicting CPO futures on BMD to trade in a range of 2300 and 2600 from now until February 2013. This will ensure high stock levels in both countries but particularly in Malaysia. Prices may plunge further if India imposes a 10% import duty on CPO and a 20% import duty on Refined Palm products. Malaysian will announce details of its proposed cut to crude palm oil export taxes by the end of December which will come into effect from Jan 01, making their exports competitive. Palm oil output in the world's biggest producer Indonesia is expected to climb 7% next year to 27 mn tn.
Source: Reuters
RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Dec'12 Futures Rs/100 kgs Rs/100 kgs Last 4225 4134 Prev day -2.31 0.41
Outlook
Soybean complex may extend the losses on forecasts of welcome rains in Brazilian soy belt. Higher sowing prospects of rabi oilseeds may also pressurize prices. Mustard prices may remain under downside pressure on prospects of higher sowing and thereby better output next year. Palm oil may trade on a negative note on account of weak outlook given by the top industry analyst amid higher stocks.
Source: Telequote
Technical Outlook
Contract Soy Oil Jan NCDEX Futures Soybean NCDEX Jan Futures RM Seed NCDEX Jan Futures CPO MCX Jan Futures Unit Rs./qtl Rs./qtl Rs./qtl Rs./qtl
valid for Dec 4, 2012 Support 689-699 3100-3145 4110-4150 418-422 Resistance 716-723 3215-3240 4225-4260 432-438
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Agricultural Commodities
Black Pepper
Pepper futures traded on a positive note yesterday on back of festive as well as winter demand, which has supported prices at lower levels. Stocks in the domestic markets are also reported to be low. Prices have corrected sharply over the last one month over reports that FMC is probing into complaints against movement in the pepper market. Better output expectations in the domestic as well as the international markets have also pressurized prices. Farmers are trying to liquidate their stocks ahead of the commencement of harvesting of the fresh crop. Exports demand for Indian pepper in the international markets is also weak due to price parity. However, The Spot as well as the Futures settled 1.1% and 1.64% lower on Monday. Pepper prices in the international market are being quoted at $7,550/tn(C&F) while Vietnam was offering Austa at $7,000/tn, Brazil Austa at $6,700/tn, and Indonesia Austa at $6,500/tn (FOB).
Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Dec '12 Futures Rs/qtl Rs/qtl Last 38147 38420 % Change Prev day 1.10 1.64
as on Dec 3, 2012 WoW -1.27 1.45 MoM -9.19 -9.84 YoY 9.73 9.43
Source: Reuters
Source: Telequote
Technical Outlook
Contract Black Pepper NCDEX Feb Futures Unit Rs/qtl
Outlook
Pepper is expected to trade on a sideways to positive note today. Festive demand coupled with winter buying may support prices at lower levels. However, higher output expectations as well as reports that FMC is probing into complaints against price movement may cap sharp gains. Liquidation pressure from farmers as well as low export demand may pressurize prices.
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Agricultural Commodities
Jeera
Jeera Futures traded on a bearish note yesterday due to sluggish demand in the domestic market. However, prices recovered from lower levels towards the end of the session on account of short coverings. Sowing in Gujarat is lower by 25-30%, but it is expected to gain momentum in the coming days. Sluggish demand coupled with higher stocks for delivery on the exchange warehouses has pressurized prices. However, regular export demand has supported prices in the spot markets. Exporters are buying due to tensions between Syria and Turkey as they are not offering. The spot as well as the March Futures settled 0.33% and 1.04% lower on Monday. According to markets sources about 75% exports target has already been achieved due to a supply crunch in the global markets. Supply concerns from Syria and Turkey still exists. Expectations are that export orders may still be diverted to India from the international markets due to lack of supplies from Syria on back of the ongoing civil war. Production in Syria and Turkey is being reported around 17,000 tonnes and around 4,000-5,000 tonnes, lesser than expectations. Jeera prices of Indian origin are being offered in the international market at $2,725 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 6-7 lakh bags compared with 5-6 lakh bags last year.
Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Dec '12 Futures Rs/qtl Rs/qtl Last 14871 14028 Prev day -0.33 -0.57
as on Dec 3, 2012 % Change WoW -0.86 -2.21 MoM -0.07 -0.81 YoY 5.25 6.47
Source: Reuters
Market Highlights
Prev day -1.05 0.94
Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Dec '12 Futures Rs/qtl Rs/qtl
Outlook
Jeera futures are expected to continue to trade downwards. Higher stocks for delivery on the exchange warehouses may pressurize prices. However, sharp downside may be capped due to export demand. In the medium term (December-January 2012), prices are likely to stay firm as there are limited stocks with Syria and Turkey.
Turmeric
Turmeric Futures recovered from lower levels yesterday on account of short coverings. Prices have corrected sharply as market sources expect Turmeric production to increase to 64-65 lakh bags from their earlier estimates of 61-62 lakh bags. Improved weather conditions in Andhra Pradesh and Karnataka has led to the revision in the production estimates. The upcountry as well as overseas demand is reported to be weak, further pressurizing prices. Stockists also have good carryover stocks with them. It is estimated that next years carryover stocks would be around 10 lakh bags. There are reports that Turmeric Farmers Association of India have decided to fix their own Minimum Support price of Rs.10000/qtl. The Spot settled 1.05% lower while the Futures settled 0.94% higher on Monday. Production, Arrivals and Exports Arrivals in Erode and Nizamabad mandi stood at 5,000 bags and 1,000 bags respectively on Monday. Turmeric production in 2012-13 is expected around 64-65 lakh bags. Production in 2011-12 is projected at historical high of 10.62 lakh tn. 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. Outlook Turmeric prices are expected to continue to trade downwards today. Higher production estimates and weak upcountry demand may pressurize prices. However, prices may find support at lower levels expecting orders from North India.
Source: Telequote
Technical Outlook
Unit Jeera NCDEX March Futures Turmeric NCDEX April Futures Rs/qtl Rs/qtl
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Agricultural Commodities
Kapas
NCDEX Kapas settled lower on Monday on account of profit taking. Demand remains robust which are seen limiting the downside despite arrival pressure. As on 18th Nov 2012, 22.66 lakh bales of Cotton has arrived so far, down by 29% compared to last year 31.97 lakh bales during the same period. Cotton export registrations for the 2012-13 season stood at 4.5 lakh bales as of November 5, 2012. Cotton exports are currently on Open General License subject to a prescribed procedure of registration. U.S. cotton futures closed higher on Monday, settling higher by 0.39 percent as bargain hunting by mills helped offset speculative short selling on expectations of a record global surplus. End-user interest re-emerged after prices dipped below 70 cents earlier in the month. With local prices in China, the world's largest producer and consumer, at almost double that level.
Market Highlights
Unit Rs/20 kgs Rs/Bale Last 969 16310
as on Dec 3, 2012 % Change Prev. day WoW -0.82 1.10 -0.67 0.68 MoM -1.27 0.68 YoY #N/A -2.39
Source: Reuters
International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 72.93 81.35
as on Dec 3, 2012 % Change Prev day WoW 0.39 2.34 0.00 0.00 MoM 3.87 1.81 YoY -20.30 -29.20
Source: Reuters
Source: Telequote
Source: Telequote
Technical Outlook
Contract Kapas NCDEX April Cotton MCX January Unit Rs/20 kgs Rs/bale
valid for Dec 4, 2012 Support 950-960 16300-16350 Resistance 980-990 16510-16600
Outlook
Domestic cotton prices are expected to recover taking cues from the international markets. Downside is limited in the domestic markets as farmers will not sell their stocks at very low prices. Also demand remain strong at such low prices.
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