Commodities Daily Report

Friday| February 22, 2013

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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Commodities Daily Report

Friday| February 22, 2013

Agricultural Commodities
News in brief
Tea planters want I-T benefits to continue
As an industry, tea is more taxed at the State-level. The planters lobby will look forward to continuance of existing benefits under the Income Tax Act. According to M. Dasgupta, Secretary-General, Indian Tea Association (ITA), the industry is hoping for seamless incorporation of Section 33AB of the Income Tax Act in the new Direct Tax Code. This will allow producers to set aside up to 40 per cent of the pre-tax profits in a good year as designated deposits to be used for developmental activities. As the Government is moving away from sector-based exemptions to investment-linked provisions, ITA is concerned that the existing I-T benefits may not be continued. The producers association has also suggested that provisions under Minimum Alternate Tax (MAT) be appropriately modified for tea and the plantation sector as a whole. The association wants MAT be computed on 40 per cent of the book profits as in the case of corporate income tax (Source: Business Line)

Market Highlights (% change)

Last Prev. day

as on Feb 21, 2013

WoW MoM YoY

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

19325 5852 54.48 92.84 1578

-1.62 -1.53 0.74 -1.72 0.04

-0.88 -0.76 0.89 -4.59 -3.46

-3.50 -3.34 1.49 -2.51 -6.41

6.50 6.30 10.79 -12.65 -10.84

.Source: Reuters

TN farmers advised to sow cotton this season

Cotton farmers in Tamil Nadu have been advised to take up sowing of suitable varieties of the white fibre this season (Masipattam February March). According to the Tamil Nadu Agricultural Universitys Domestic and Export Market Intelligence Cell (DEMIC) sources, the price of the cotton sown now and due for harvest four months down the line in July August, could either move up or remain at the same level. After analysing the price movement in the Konganapuram Cooperative Marketing Society, TNAU sources estimate the price of the long staple fibre to hover around Rs 4,200 and Rs 4,500 a quintal in July August 2013. "Increase in export orders, if any, from China, Bangladesh and Pakistan may bring positive changes in prices; else the price will remain stable," the DEMIC source said. (Source: Business Line)

All curbs off on cotton exports, for now

The Government has decided to continue with the existing policy of allowing cotton exports without any restrictions. This decision was taken after an Inter-Ministerial Committee comprising top officials from Commerce, Agriculture and Textiles Ministries reviewed the cotton scenario in the country recently. The committee, comprising secretaries from the three Ministries took stock of the cotton situation, including production, arrivals, registration and exports, a Commerce Department release said. The Committee noted that the situation with respect to cotton availability, prices and export is satisfactory and decided that the current dispensation may continue. The Committee has decided to keep a watch on the situation and meet as and when the situation warrants, the statement said. (Source: Business Line)

Traders turn attention to Odisha turmeric

Spot turmeric prices decreased by Rs 150 a quintal on Thursday as the market still awaited for orders from North India. However, the focus now has turned to turmeric from Odisha. Though quality and hybrid varieties of turmeric arrived for sale, the traders quoted lower price, purchased very limited stocks. This is due to want of demand received from North India. Some traders in Bihar placed orders for Odisha turmeric and purchased significant stocks. Some Erode traders, too, procured limited quantity of Odisha turmeric. Turmeric sales in Nizamabad will commence only on Friday, the local traders purchased restricted quantity here, as they feel prices may decrease after the Nizamabad market opens, said R.K.V. Ravishankar, President, Erode Turmeric Merchants Association. (Source: Business Line)

Wheat exports may touch 8-mt

Indias wheat exports are likely to grow by 23 per cent to 8 million tonne in the marketing year starting April due to strong global prices and surplus domestic supply, according to a report. The country had shipped 6.5 million tonne wheat last year, with maximum stock exported from government godowns. Ban on wheat exports was lifted in September 2011, but shipments took off strongly only after August 2012. Assuming continued exports of wheat from government stocks and export price parity for Indian wheat visavis other origins, wheat exports during 201314 marketing year are forecast to increase to 8 million tonne, the US Department of Agriculture (USDA) said in its latest report. Of this, 5 million tonne wheat will be from government side, while 3 million tonne will be sourced from open market by private traders, it said. According to the USDA, exports of governmentheld stocks are likely to continue unabated this year due to tight storage facilities, while the government will be under tremendous pressure to clear stock to accommodate the new crop. (Source: Business Line)

Corn Drop Seen as U.S. Sows Most Since 1936: Commodities

From South Dakota to Ohio, farmers are preparing to plant the most corn in almost eight decades after drought ruined record U.S. harvests predicted by the government. Farmers are looking for every acre possible to plant this year, said Bill Bayliss, 67, who is expanding acreage by 10 percent on land he farms in West Mansfield, Ohio, where drought conditions have disappeared. The price is attractive, and we have seen an improvement in soil moisture. Corn acreage in the U.S., the worlds top grower and exporter, will be the largest since 1936, yielding an alltime high of 13.863 billion bushels at harvest should weather conditions improve, the average of 17 analysts estimates in a Bloomberg survey shows. The U.S. Department of Agriculture, in a report today, predicted output will jump 34.8 percent to a record 14.53 billion. (Source: Bloomberg)

India turns net importer of pepper

India is practically out of the global pepper export with the total exports in 2012 equivalent to just 10% of Vietnam, the worlds largest producer. In 2012, Vietnam exported 116,962 tonnes of pepper (100,381 tonnes of black pepper and 16,581 tonnes of white pepper).According to data available, India exported around 12,000 tonnes. India, which was the top exporter till 1995, has turned a net importer of the spice in the last calendar year. Compared to 2011, Vietnams export of black pepper increased 463 tonnes, while that of white pepper fell 1,917 tonnes. The total turnover was $ 794 million, with black pepper contributing $ 642 million and white giving $ 152 million, according to latest data from the Vietnam Pepper Association. Compared to 2011, turnover of black pepper increased 18% and that of white pepper rose three per cent. India is nowhere in the global export market and data on exports in 2012 have not yet been released by the Spices Board. (Source: Business Standard)

USDA forecasts record U.S. corn and soy, lower prices

The U.S. Department of Agriculture on Thursday projected a rebound in U.S. corn and soybean yields in 2013 that, along with high planted acreage, opens the door to record-large crops and for prices to tumble from 2012/13 levels. The USDA forecast the U.S. corn crop at 14.350 billion bushels, up 35 percent on the year, and soybean output at 3.405 billion bushels, up 13 percent. "A number of factors suggest that corn and soybean yields will be likely to return to trend," Joseph Glauber, the USDA's chief economist, said. Glauber projected that season-average U.S. corn prices for 2013/14 would fall 33 percent to $4.80 per bushel and that soybean prices would tumble 27 percent to $10.50 a bushel. (Source:
Reuters)

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Commodities Daily Report

Friday| February 22, 2013

Agricultural Commodities
Chana
Chana traded on a negative note yesterday on expectations arrival to increase further in the coming days. Chana spot had gained in the last one week on the back of good demand by the stockiest at lower levels. Ministry of Agriculture in its second advance estimates, have pegged, bumper chana output for 2012-13 season at 8.57 mn tn, up 11% from 2011-12 final estimates of 7.7 mn tn.

Market Highlights
Unit Rs/qtl Rs/qtl Last 3650 3444 Prev day 0.53 -0.69

as on Feb 21, 2013 % change WoW MoM 0.41 -7.29 0.12 -3.69 YoY 0.00 -2.74

Chana Spot - NCDEX (Delhi) Chana- NCDEX Apr'13 Futures

Pulses Sowing 2012-13

Chana sowing is 5.6% higher at 94.99 lakh ha compared to previous year. Chana acreage is marginally higher by 3% this year in Rajasthan at 14.80 lakh ha, In Maharashtra, Chana acreage is up at 11.12 lakh ha vs normal area of 10.6 lakh ha. While in AP it is up at 7.27 lakh ha, up by 28%. Compared to previous year. (Source: State farm dept)

Source: Reuters

Technical Chart - Chana

NCDEX April contract

Demand supply fundamentals

According to second advance Estimates released on 8 Feb 2013, Total pulses output for 2012-13 season has been pegged at 17.58 mn tn, down 3.3% compared to previous year. The target for 2012-13 pulses crop output was set at 18.24 million tonne during the year. However, drought conditions have hampered kharif pulses output, which has been only partially offset by Rabi pulses output, especially chana. Out of the total pulses output, kharif output is estimated at 23% lower at 5.48 mn tn while rabi pulses output is pegged 8.72% higher at 12.09 mn tn compared with the final estimates of 2011-12. There has been a sharp increase in the chana output estimates on the back of higher acreage and good yield. Chana output is expected to breach its 2010-11 record of 8.2 mn tn and is estimated at 8.57 mn tn for 2012-13. In its first advance estimates chana output was pegged at 7.9 mn tn. India needs imports as its domestic production is insufficient to meet the rising demand. Assocham estimates, 21 mn tn of pulses demand in 2012-13 and is likely to reach at 21.42 mn tn in 2013-14 and 21.91 MT in 2014-15. (Source: Agriwatch).
Source: Telequote
th

Technical Outlook
Contract Chana Apr Futures Unit Rs./qtl Support

valid for Feb 22, 2013 Resistance 3475-3510

3400-3425

Trade Scenario
In Australia, total chickpea production in 201213 is estimated to have increased to a record of around 746000 tones as compared with 485000 tons in 2011-12. India imports Chana mainly from Australia and Canada and higher availability in these countries at comparatively cheaper rates is seen boosting imports of Chana to meet the domestic shortfall.

Outlook
Chana Futures may trade on a mixed note today. Demand from the stockists may support prices at lower levels. However, increasing arrival pressure may pressurise the prices. It is crucial to keep a close watch on weather conditions. Adverse reports may bring an upside rebound in the prices. Government has fixed MSP of chana at Rs 3200 per qtl for 2012-13 seasons. Thus despite increasing arrival pressure prices may not fall much below Rs 3200 per qtl levels as farmers will not liquidate their produce below these levels/

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Commodities Daily Report

Friday| February 22, 2013

Agricultural Commodities
Sugar
Sugar futures declined by 0.29% on Thursday on account of profit taking. Expectations government may soon take some decision over sugar decontrol have led to an increase over the last few days. Indias Agriculture Minister Sharad Pawar said that they are favoring Food Ministrys proposal to increase the production tax on Sugar from the current Rs. 0.71/kg by Rs. 1.5/kg if mills were freed from an obligation to sell the sweetener at lower prices for public distribution. India's sugar production in the 2013/14 season is set to fall below consumption for the first time in four years as a water shortage trims acreage in three key states. Food minister KV Thomas on Thursday said the government is likely to take a decision on decontrolling the sugar industry before the Budget. Food ministry has proposed dispensing with the regulatory release mechanism and abolishing the levy system. India has fixed FRP (Fair and Remunerative Price), the price sugar mills must pay to cane growers at Rs. 210/qtl in the 2013/14 year, compared to current years 170 per qtl. Higher floor price increases the cost of production as the raw material cost constitute the major part of cost of production of sugar. This should actually increase the prices of sugar. Liffe white sugar as well as raw sugar futures on ICE settled lower by 0.64% settled 1.25% as The International Sugar Organization, in its quarterly report, forecasted a global sugar surplus of 8.526 mt in 2012/13, up from 6.479 mt in 2011/12. A stronger dollar also supported the downside. A global surplus situation has led the prices to a sharp decline. Currently the prices are trading around their 2 year lows.

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Mar'13 Futures Rs/qtl Last 3207

as on Feb 21, 2013 % Change Prev. day WoW -0.35 0.06 MoM -1.83 YoY 10.12

Rs/qtl

3140

0.48

2.88

-3.62

9.68

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMay'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 498 402.67

as on Feb 21, 2013 % Change Prev day WoW -0.64 -1.25 1.55 1.00 MoM 1.22 -1.36 YoY -22.57 -28.52

.Source: Reuters

Technical Chart - Sugar

NCDEX March contract

Domestic Production and Exports

Out of the estimated 24 mn tn sugar output for the season 2012-13, Indian 13.7 mn tn in the first four months of the season beginning October 2012, up 3 percent a year ago period. With the opening stocks of 6.5 mn tn, domestic Sugar supplies are estimated at 30.5 mn tn against the domestic consumption of around 22. 5mln tn for 2012-13. Exports are not viable as international prices have also declined significantly.

Source: Telequote

Global Sugar Updates

Brazil plans to reduce taxes on ethanol to boost production and use of the biofuel. If brazil cuts tax the ethanol parity to sugar may rise and thus the share of cane directed to sugar production in the 2013-14 season may be 44 -45%, down from 49.6 % in the current period. Brazil's main center-south cane crop will produce between 580 million and 590 million tonnes of sugar cane in 2013/14. Brazil will likely favor ethanol production over sugar from the 2013/14 cane crop. According to Job Economia, Brazil's main center-south cane crop is due to produce 36 mn tn of sugar in 2013/14 higher than 34.2 mn tn last year. In the international markets, ICE Raw sugar fell to their two and a half years low expecting third consecutive year of global surplus in 2012-13. A third consecutive global sugar surplus will trim prices as supply is forecast to exceed demand by more than 8 million tonnes in the crop year to September 2013.

Technical Outlook
Contract Sugar Mar NCDEX Futures Unit Rs./qtl Support

valid for Feb 22, 2013 Resistance 3150-3165

3120-3130

Outlook
Sugar futures may open lower initially, however, may bounce back as demand is expected to improve gradually from the bulk manufacturers in the coming weeks. Markets may also take cues from the decision over sugar sector, which government is expected to consider before budget.

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Commodities Daily Report

Friday| February 22, 2013

Agricultural Commodities
Oilseeds
Soybean: Soybean Futures traded on a positive note yesterday
extending previous days gains and settled 0.44% higher on Thursday on account firm international markets coupled with good demand for soybean from the crushing industry for its meal. Oil meal exports rose by almost 40 per cent to 7.68 lakh tonnes in January this year, industry body Solvent Extractors Association of India said. The export of oil meals, however declined by 18 per cent to 36.79 lakh tonnes in the first 10 months of this fiscal compared to 44.85 lakh tonnes in the year-ago period. The country exported 25.36 lakh tn soybean meal in first 10 months compared to 30.82 lakh tn in the same period last year which showing a decline of 17.72%. According to the second advance estimates, 2012-13 oilseed output is pegged at 29.4 mn tn, down by 1.1%, while soybean output is pegged higher at 12.9 mn tn, up 3.2%.
Soybean Spot- NCDEX (Indore) Soybean- NCDEX Mar '13 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Mar '13 Futures

Market Highlights
Unit Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3411 3331 727.1 700.9

as on Feb 21, 2013 % Change Prev day -0.38 -2.02 -0.88 -4.51 WoW 2.06 1.23 -1.18 -4.07 MoM 4.31 1.73 -3.31 -3.76 YoY 31.80 26.61 1.78 -2.00

Source: Reuters

as on Feb 21, 2013 International Prices Soybean- CBOTMar'13 Futures Soybean Oil - CBOTMar'13 Futures Unit USc/ Bushel USc/lbs Last 1488 51.31 Prev day 0.34 -1.46 WoW 4.55 -0.68 MoM 4.09 -0.72
Source: Reuters

YoY 17.05 -5.09

International Markets
Soybean Futures on CBOT traded on a positive note and settled 0.85% higher on concerns over the Argentina crop. Strong demand from China after the Lunar New Year break also pushed up the prices. China was also buying the old soybean crop. US soybean processors crushed 158.195 mn bushels of soybeans in January, the second-largest monthly total in 3 years due to huge demand for soy meal, both from exporters as well as domestic livestock producers. The scant rains and high temperatures worrying Argentine farmers since January have started to hit the development of corn and soy crops. 99% of the estimated soy area of 19.35 mn ha has been covered as on 14th Feb. Rains are urgently needed in the current yield-setting phase; otherwise productivity will be seriously affected. China, the world's largest soy buyer, imported 4.78 million tonnes of soybeans in January, down 18.8 percent from 5.89 million tonnes in December

Crude Palm Oil

as on Feb 21, 2013 % Change Prev day WoW -1.12 0.00 1.85 2.14

Unit
CPO-Bursa Malaysia Mar '13 Contract CPO-MCX- Feb '13 Futures

Last 2481 457.2

MoM 6.48 3.37

YoY -23.28 -15.02

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Apr'13 Futures Rs/100 kgs Rs/100 kgs Last 3750 3454 Prev day 0.00 -0.46

as on Feb 21, 2013 WoW 0.00 1.44 MoM -10.07 -1.43

Source: Reuters

Refined Soy Oil: Ref soy oil settled lower on account of weak
international markets, while CPO prices settled unchanged as weak Rupee nullified the effect of weak Malaysian palm oil markets. India's vegetable oil imports soared 27 percent from a month ago to an all-time high in January on purchases of cheap palm oil. To curb imports, the tariff value of crude palm oil, the edible oil India imports most, has been raised from $ 815 a tonne to $ 848 a tonne, a rise of 4.04%. However, 1-20 Feb Malaysian exports rose 0.6%. If the trend continues, CPO prices may witness an upside in the coming days.

YoY 10.91 -3.87

Technical Chart Soybean

NCDEX March contract

Rape/mustard Seed: Mustard Futures settled lower by 0.46% on

account of long liquidation. Rains in the mustard growing regions have raised concerns over delay in the harvesting and arrivals of the new crop. Mustard seed sowing is now up by 2.2% at 67.23 lakh ha. Arrivals are expected to commence in February and thus no major upside in the prices is seen if weather condition improve in the coming days. Agriculture ministry in its third advance estimates, pegged mustard output at 7.36 mn tn, up by 11.5%.

Outlook
Soybean complex is expected to trade higher today due to crop concerns in Argentina. Good meal demand is also expected to support prices. Mustard seed may remain weak on higher output expectations. CPO may trade firm on expectations of palm oil exports to improve gradually while output may fall due to seasonally lower yield.

Source: Telequote

Technical Outlook
Contract Soy Oil Mar NCDEX Futures Soybean NCDEX Mar Futures RM Seed NCDEX Apr Futures CPO MCX Feb Futures Unit Rs./qtl Rs./qtl Rs./qtl Rs./qtl

valid for Feb 22, 2013 Support 694-697 3265-3300 3410-3435 451-454 Resistance 703-707 3365-3390 3490-3520 460-463

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Commodities Daily Report

Friday| February 22, 2013

Agricultural Commodities
Black Pepper
Pepper March Futures traded on a mixed note yesterday. Prices traded lower due to profit taking at higher levels but recovered towards the end on account of low stocks, thin supplies and delayed harvesting due to lack of skilled laborers. Harvesting of the fresh crop is going in and is expected to gain momentum in the coming days. Some improvement in the arrivals of the fresh crop led to a decline in the prices earlier last week. Food Safety and Standards Authority of India sealed the entire quantity of pepper stored in six warehouses in Kerala of about 8,000 tonnes. Exports demand for Indian pepper in the international markets is also weak due to price parity. The Spot market remained closed due to Bharat Bandh while the Futures settled 0.22% lower on Thursday. According to a circular issued by NCDEX on 09/02/2013, launch of June 2013 expiry contract in Pepper which is scheduled on February 11, 2013, has been postponed till further notice. The revised launch date will be announced in due course. Spices Board has announced plans to import high yielding Madagascar variety that was behind the record productivity in Vietnam. It could raise productivity of Indian pepper from 2,000 kg/ha to 7,000 kg/ha. Pepper prices in the international market are being quoted at $7,950/tn(C&F Europe). Vietnams 550 GL is quoted at $6,700/tn, Malaysia and Indonesia Austa variety are quoted at $7,000/tn and Brazil black pepper is quoted at $6,600/tn.

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Mar'13 Futures Rs/qtl Rs/qtl Last 40963 37955 % Change Prev day 0.00 -9.05

as on Feb 21, 2013 WoW 0.63 -3.98 MoM 5.13 2.30 YoY 26.84 18.28

Source: Reuters

Technical Chart Black Pepper

NCDEX March contract

Exports and Imports

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 pepper during Jan-Oct 2012 stood at 102,340 mt, lower by 12% as compared to 1,15,780 mt in the same period last year. Total exports in 2012 are forecasted at around 1,10,000 tonnes. Pepper imports by U.S. the largest consumer of the spice declined 9% in 2012 period to 62,458 tn as compared to 68,489 tn in 2011. 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. Brazil exported 25,900 tn pepper during Jan-Nov 2012, around 20% lower compared with 32,650 tn in the same period last year. Exports from Malaysia 8,300 tn pepper during Jan-Oct 2012, lower by 30% last year while exports in October stood at 1,077 mt in.
Source: Telequote

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

valid for Feb 22, 2013 Support 37370-37630 Resistance 38230-38560

Production and Arrivals

The arrivals in the spot market were reported at 85 tonnes while off takes were reported at 80 tonnes on Tuesday. The domestic markets remained closed on Thursday due to Bharat Band. As per IPC, Global pepper production in 2012 is projected at 3.27 lk tn, up compared with 3.18 lk tn in 2011. Production for 2013 is projected at 316832 tn. Indonesian pepper output is expected to rise by 24% and in Vietnam by 10%. According to estimates, pepper output in Vietnam is estimated to be 1.05 lakh tonne in 2012 as compared to 1.1 lakh tonne in 2011. Brazil is also expected to produce 22,000 tn this year. 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) Pepper production in 2012-13 is expected around 60,000-63,000 tonnes. Currently, pepper is in the fruit formation stage in Kerala.

Outlook
Pepper is expected to trade on a positive note today on account of low stocks coupled with thin arrivals. Reports that farmers are holding back stocks may also support prices at lower levels. However, any improvement in arrivals will cap sharp upside.

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Commodities Daily Report

Friday| February 22, 2013

Agricultural Commodities
Jeera
Jeera Futures opened lower yesterday on account of increase in the arrivals of the new crop over the last few days. However, prices recovered from lower levels towards the end on account of short coverings. The arrivals of new crop are around 3,000-4,000 bags/day and are expected to increase in the coming days. Higher sowing as well as conducive weather in Gujarat, the main jeera growing region has increased output expectations. According to Gujarat State Agri Dept. sowing in Gujarat is reported at 3.244 lakh ha till Jan, 2013 compared with 3.64 lakh ha last year. In Rajasthan, sowing is expected to increase by 10-15%. The spot settled 0.49% lower while the Futures settled 0.58% higher on Thursday. 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 $2,975-$3,000 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 5-6 lakh bags.

Market Highlights
Unit Jeera Spot- NCDEX (Unjha) Jeera- NCDEX Mar '13 Futures Rs/qtl Rs/qtl Last 13775 13340 Prev day -0.49 0.58

as on Feb 21, 2013 % Change WoW -0.01 0.38 MoM -3.60 -2.56 YoY -4.89 -3.36

Source: Reuters

Technical Chart Jeera

NCDEX March contract

Production, Arrivals and Exports

Arrivals in Unjha were reported at 10,000 tn on Thursday. Production of Jeera in 2011-12 is expected around 40 lakh bags as against 29 lakh bags in 2010-11 (55 kgs each). 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

Market Highlights
Prev day 0.00 -2.61

as on Feb 21, 2013 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Apr '13 Futures Rs/qtl Rs/qtl

Last 5457 6118

WoW -0.26 -3.23

MoM -1.16 -2.11

YoY 17.04 30.06

Outlook
Jeera Futures is expected to trade on a mixed note today. Higher arrivals may pressurize prices while, overseas demand at lower levels may support prices. Demand from domestic traders and millers may also support prices at lower levels. In the medium term, prices are likely to stay firm as Syria and Turkey have stopped shipments.

Technical Chart Turmeric

NCDEX April contract

Turmeric
Turmeric Futures declined sharply yesterday due to supplies of the new crop coupled with higher carryover stocks. Prices have gained over the last few days due to some unseasonal rains in Andhra Pradesh coupled with output concerns. There is good demand from local buyers and stockists. The Spot remained closed on account of Bharat Band while the Futures settled 2.61% lower on Thursday.

Production, Arrivals and Exports

Arrivals in Erode stood at 3,000 bags while Nizamabad mandi remained closed on Thursday due to labour strike and will open on Wednesday. Expectations are that production may be lower by 40-50%. There are reports of some crop damage in Erode region. Turmeric production in 2012-13 is expected around 50 lakh bags. Production in Nizamabad is expected around 12 lakh bags. Production in 2011-12 is projected at historical high of 10.62 lakh tn. It is estimated that next years carryover stocks would be around 10 lakh bags 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 is expected to trade sideways with a negative bias today. Higher carryover stocks and weak overseas demand may pressurize prices at higher levels. However, lower output concerns and demand from stockists at lower levels is expected to support prices at lower levels.
.

Source: Telequote

Technical Outlook
Unit Jeera NCDEX March Futures Turmeric NCDEX April Futures Rs/qtl Rs/qtl

Valid for Feb 22, 2013

Support 13070-13220 5930-6030 Resistance 13460-13550 6170-6270

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Commodities Daily Report

Friday| February 22, 2013

Agricultural Commodities
Kapas
Kapas futures and MCX Cotton corrected from higher levels on account of profit booking and settled 0.94% and 0.62% lower respectively on Thursday. Improved demand and expectations that China may release import quota. Cotton supplies since the beginning of the year in October 2012 until February 10, 2013 were down at 183.4 lakh bales, down from 189.27 lakh bales a year earlier. The Cotton Advisory Board, which met in Mumbai on Wednesday, has estimated cotton production this season (Oct 2012 to Sep 2013) will be 330 lakh bales against the previous estimates in October at 334 lakh bales. Also, exports and domestic consumption has been revised upward to 253 and 80 lakh bales respectively from 250 and 70 lakh bales estimated earlier. As on January 9 this year, nearly 38 lakh bales were registered for exports. ICE Cotton futures declined yesterday and closed 1.18% lower on account of profit taking coupled with a stronger dollar. China returned to the markets after the New Year break which have supported prices. There is strong demand from China. US Cotton acreage is likely to go down by 27% which may support prices in the international markets. Strong weekly export sales figures also supported prices last week.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 951.5 17580

as on Feb 21, 2013 % Change Prev. day WoW -0.94 4.68 -0.62 2.81 MoM 4.91 2.81 YoY #N/A -0.40

NCDEX Kapas Apr Futures MCX Cotton Feb Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit USc/Lbs Last 81.31 81.35

as on Feb 21, 2013 % Change Prev day WoW -1.18 0.36 0.00 0.00 MoM 3.51 0.00 YoY -10.89 -29.20

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Domestic Production and Consumption

According to Cotton Advisory Boards (CAB) estimates (23 Jan 2013) for 2012-13 season that commenced in October, domestic cotton production is pegged 330 lakh bales, down from the previous years estimates of 353 lakh bales. However, higher exports and domestic consumption can be met through revised higher opening stocks of 40 lakh bales and higher imports. After witnessing record exports in 2011-12 season, Indian exports could witness significant fall this season on the back of lower availability along with unattractive domestic cotton prices. CAB estimates cotton exports at 80 lakh bales this season, compared with 128.8 lakh bales last year.
Source: Telequote
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Technical Chart - Cotton

MCX Feb contract

Global Cotton Updates

U.S. weekly export sales of the Cotton nearly doubled in the week ended Feb. 7 to a total of 185,700 running bales. The strong recovery after two weeks of declining exports alleviate concerns of waning demand from Chinese buyers, though the volumes remained five percent lower than the previous four-week average. The U.S. government on Friday nudged higher its global cotton stockpile forecast for 2012/13 amid expectations that China, the world's largest textile market, will import even more fiber for its massive strategic supply. However, the government lowered US carryover by 300,000 bales, or 6 percent, to 4.5 million bales due to an increase of the same size in its export estimate to 12.5 million bales.
Source: Telequote

Technical Outlook Outlook

Kapas/Cotton is expected to trade on a positive note today on account of firm international markets amid lower US cotton planting intentions for 2012-13 expectations that China may release higher import quota. However, sufficient supplies in the domestic markets and lower export demand expectations may cap sharp upside in the prices.
Contract Kapas NCDEX April Futures Cotton MCX Feb Futures Unit Rs/20 kgs Rs/bale

valid for Feb 22, 2013 Support 938-944 17390-17490 Resistance 960-970 17670-17740

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