29 March 2012

FORPRIVATECIRCULATIONONLY

Oil & Oilseeds Daily

HIGHLIGHTS

Domestic edible oil complex closed traded lower as

lower international market and high domestic
suppliesweighonprices

EdibleoilcorrectedthemostwhileMustardseedsaw
theleastcorrection

Long liquidation in edible oil and Soybean was

witnessed while Mustard seed saw short
accumulation

Brazil soy crop is expected to reach a record 94.2

milliontonsfor2014/15,up3percentfromprevious
forecast of 91.4 million tons Celeres. Last season,
Brazilharvested86.3milliontonnesofsoybeans.The
new crop which has begun early harvesting will pick
up speed in the coming months and peak in March
andApril.

The Brazilian soybean crop deteriorated from

detrimental weather in the three weeks to Jan 20,
however, soybean standing crop conditions have
improvedinArgentina

Oil World has released its latest report on global

edible oil industry. In its report it estimated India
soybeancrushingat6873lakhtonnesinthecurrent
season as against 201213 record level of 92 lakh
tonnes.

Mustard seed traders continued to apt for cautious

approach, as stockiest were unwilling to sell their
socksatcurrentlevel.Ontheotherhand,competing
markets showing signs of weakness, provided little
supportforthecommodity.

TheRSOCPOspreadinlasttradingsessionwasatRs
217 compared to 218. The spread has been on a
risingtrendandhaspassedtheprevioushigh.

January23,2015

FUTURESPRICEMOVEMENT

22Jan15
EDIBLEOILCOMPLEX
Low
Close
%Chg

Vol(MT)

OI

OI

3359
3373
3388

1.00%
1.20%
1.37%

65140
32390
9900

76750
38690
11880

10780
2750
4120

625
600.05
583.55

1.87%
2.14%
0.85%

54175
21410
9950

69145
59265
53015

340
2540
510

3431
3464
3520

0.41%
0.46%
0.06%

35720
3150
640

38920
5660
1820

2370
260
10

438.4
444.5
448.7

1.64%
1.64%
1.79%

667
2196
602

1082
3330
1825

215
224
169

Contract
Open
High
NCDEXSOYBEANSRs./Qtl
Feb15
3395
3416
3346
Apr15
3414
3431
3352
Jun15
3433
3452
3360
NCDEXREFINEDSOYOILRs./10kg
Feb15
637
637.8
624.1
Apr15
613
613.85 598.6
Jun15
588
588
579.4
NCDEXMUSTARDSEEDRs./Qtl
Apr15
3447
3480
3414
May15
3477
3514
3451
Jun15
3524
3544
3500
MCXCRUDEPALMOILRs./10kg
Jan15
445.7
445.7
436.1
Feb15
452
452
443
Mar15
457
457
447.5
Note:MCX&ACEOIinLots

INTERNATIONAL
Contract
Open
High
Low
Close
Change
CBOTSOYBEANUSCents/Bushel
Mar15
984.25
992.5
975
976.8
6.75
May15
990
998.5 981.25
983.0
6.5
CBOTSOYMEALUS$/shortton
Mar15
330.8
335.8
327.7
330.1
0.4
May15
323.4
327.3
320.7
322.6
0.1
CBOTSOYBEANOILUSCents/Pound
Sep16
32.39
32.58
31.9
31.97
0.44
Oct16
32.57
32.74
32.08
32.16
0.42
WCECANOLACanadian$/ton
Mar16
469.1
469.1
469.1
469.1
5
May16
458
463.4
457.6
462.2
3.4
BURSAMALAYSIAPALMMYR/ton
Apr15
2278
2282
2242
2246
27

%chg
0.69%
0.66%
0.12%
0.03%
1.36%
1.29%
1.08%
0.74%
1.16

RSO CPOSpotSpread
350

RSO CPOSpotSpread

300
250
200
150
100
50
0
10Nov10 10May11 10Nov11 10May12 10Nov12 10May13 10Nov13 10May14 10Nov14

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29 March 2012

Oil & Oilseeds Daily

MARKETANALYSIS

OUTLOOK

SoybeanDomesticsoybeanfuturesareexpectedto
trade weak tracking sell off on CBOT. U.S. soybean
futures fell Thursday on expectations of large South
American soy harvests that should boost global
inventories, coupled with strength in the U.S. dollar.
Chicago Board of Trade soybean futures declined in
earlytradesandaretradinglowerby0.1%.InIndian
market, Soy complex witnessed weak tone in prices
onthedomesticspotmarketamidlowdemandand
slowarrivals.
Refined Soybean Oil RSO future during the session
isexpectedtotradeweak.Indiarefinedsoyoilprices

quotedlowerinspotmarketsacrossthecountrydue
tolowdemand.Thecommodityisalsosufferingfrom
steadybuildingupofsupplypressure.Soyoilfutures
dropped pressured by technical selling and lower
soybean. CBOT Soy oil is trading lower by 0.3% in
earlytrades.

Crude Palm Oil MCX CPO futures are expected to

trade lower as sell off across the global market will

weighonCPO.Malaysianpalmoilfuturesdroppedto
lowest level in three weeks on Thursday as the
their

ringgit
ticked up and crude oil prices continued to

languish, but tight supplies of palm after flooding

provided some support. BMD palm oil prices are

tradinglowerby0.8%inearlytrades.

RapeseedMustardseedpricesareexpectedtotrade
firm for the new crop contract. Mustard seed and
Expeller prices have turned softer on the domestic
spot markets due to slower demand. Soft tone in
competing markets has also dented the prospect.
Meanwhile, rains in northern region of the country,
helped restrict price fall. Markets continue to eye
cropgrowthprogresswhichwilldeterminethefuture
availability of the commodity. Focus will also be on
mustard oil demand in the wake of changing
weather.NCDEXAprilcontractisgettingsupportnear
Rs.34103400 while resistance is seen near Rs.3470
3480.

Oil & Oilseeds Daily

Centre
Spot
SOYBEANSRs./Qtl
Indore
3359
Kota
3270
Nagpur
3350
REFINEDSOYOILRs./10kg
Indore
656
Mumbai
641
Nagpur
661
SOYMEALRs./ton
Indore
28700
MUSTARDSEEDRs./Qtl
Alwar
4125
Jaipur
4038
Source:NCDEX&ACE

Change

CRUSHMARGIN&OILMEALSHARE
Rape/MustardComplex
GrossCrush(Rs.)
4890
Oilshare
75.51%
Mealshare
24.49%
SoybeanComplex
GrossCrush(Rs.)
370.00
Oilshare
30.9%
Mealshare
69.1%
Source:SEA,KCSL

23
19
0
7
4
12
0

0
8

Currency
USD/INR

Type
Spot

Close
61.59

%Chg
0.06

C&F RateMumbai
876
540
667
411

Oil(Crude)

Imp Base
Tariff
972

912

Soyoil$/ton
Rs./10kg
PalmOil$/ton
Rs./10kg
Source:SEA,KCSL
Note:Domesticprice:SoyoilExIndore
PalmOilExKandla

Landed
Price
901
555
690
425

Domestic
Price
570
440

WAREHOUSESTOCKSinMT(Ason21January2014)

Centers

TOTAL
TOTAL

NCDEX
ACE
Demat
InProcess
Demat
InProcess
SOYBEAN
10329
0
0
0
MUSTARDSEED
9577
0
0
0

COMMODITY

CONTRACT

SOYBEAN
RSO
MUSTARDSEED
CPO

February
February
April
February

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SUPPORT

RESISTANCE

3300
618
3400
440

3420
630
3480
450

INTRADAY
TREND
Bearish
Bearish
Bullish
Bearish

29 March 2012

Oil & Oilseeds Daily

Analysis:Pricesofsunfloweroilandsunflowerseedhavesoftenedalittleoverthelasttwomonthsunderpressurefromthe

plummeting
crude oil price and a general oilseed glut. However, the decline for sun oil has been modest compared to other

vegetableoils.Thisispartlyduetoexpectationsoflowerglobalsuppliesthisyear,andstrongdemandfromplaceslikeIndia.But

increasing stockpiles
of vegetable oils in India and China could mean demand from these destinations starts to drop off, and

thereisalsothequestionofhowlongvegetableoilpricescanwithstandthedownwardpressurefromcrudeoil,withwhichthey

areusuallycloselyaligned.

SUPPLY:BlackSea:InUkraine,thesizeofthenew sunflowercropisstilluncertain,with areaforecastsrangingfrom4.5mln

hectaresto5.5mlnha.TheUSDAforecastthecountryssunseedproductiontodropby14%comparedwith2013/14to10mln

tonnes,whilesunfloweroiloutputwaspeggedtodropby4%to4.26mlntonnes.Exportsofsunfloweroilarealsopeggedtofall

by4%to3.7mlntonnes.Ukrainessunoilexportsduringthefirstfourmonthsoftheseason(JulythroughOctober2014)roseby

nearly40%comparedwiththepreviousyearto1.3mlntonnes.

EU:TheEUistheonlymajorproducerforwhichtheUSDAforecastariseinsunflowerseedproductionthisseason,upby2%to

9.04mlntonnes.Asaresult,importsbytheblocarepeggedtofallby22%forsunseedand18%forsunoil.

Argentina: The USDA

forecast a 19% rise in sunflower seed output for Argentina in 2014/15 to 2.5 mln tonnes, with sunoil

productionalsoexpectedtoriseby12%to1.06mlntonnes.However,mostofthatincreasewillbeabsorbedbyhigherdomestic

consumption,withseedexportsprojectedtoremainlevelwith2013/14butoilexportsareforecasttogrowby7%to375,000

tonnes.HarvestingofthenewcropstartedearlierthismonthinthenorthernregionsofChacoandSantaFe,butduetorainfall

farmerswereonlyabletogetaround5%ofthecropoffthefieldsbyJanuary8,AldebaranCommoditiessaidinareport.Thereis

notmuchseedleftoftheoldcrop,andproducersaretryingtosellanyremainingstocksbeforethenewcroparrives,withprices

stablefornow,itadded.

DEMAND:
India: Sunflower oil imports by India continued to run at a strong pace during the last two months of 2014, with

194,032tonnesbookedinNovemberand151,626tonnesinDecember.Thiswas52%morethanduringthesametwomonthsa

yearearlier,accordingtotheSolventExtractorsAssociationofIndia.Pricesforsunfloweroilfellby2%inDecembertoUSD879

pertonne(CIFIndianport),narrowingthedifferentialbetweensunoilandsoybeanoiltoUSD37pertonne.Soybeanoil,which
hastraditionallybeenmoreexpensivethansunfloweroil,hasbeentradingatadiscounttosunoilsinceOctoberduetostrong
demandandtightsuppliesforsunoil.Localsourcessaidthatsunoilretailpriceshaverisenbyaround8%sincethebeginningof
thecurrentoilyearonNovember1,whichcouldleadconsumerstoswitchtothenowcheapersoyoilandrestrictimportsover
thecomingmonths.Stockpilesofcookingoilshadgrownto38dayslocaldemand,comparedwithnormallevelsofaround25
days.Importsshouldslowdownbecauseofthesestockpiles.

China:InNovember,Chinaimported1,253tonnesofsunflowerseedfromKazakhstan,athreemonthhigh.However,importsof
sunflower oil only came to 4,419 tonnes, a fraction of the amounts seen earlier last year in the summer. For the year to
November2014,sunoilimportsroseby20%yearonyeartoaround430,000tonnes.

EU:AlthoughEUsunseedproductionisforecasttobemarginallyhigherin2014/15,thebloccouldstillseeincreaseddemand
forsunoilimportsduetoanexpectedslumpinglobaloliveoilproduction.Traditionalcookingoilconsumersmightbeforcedto
switchtosunoilasoliveoilproductionisforecasttowitnessadropof27%thisseasonduetobadweatherandpestdamagein
theworldsmainproducers,SpainandItaly.

PRICE OUTLOOK: Competition among vegetable oils is likely to remain tough in the near term due to large global oilseed
supplies, especially soy. Furthermore, vegetable oil prices are almost certain to follow crude oil down eventually, at least to
someextent.However,ontheupside,tightersuppliesofsunflowerseedandsunoilthisseason,alongwithitspopularityasa
cookingoil,shouldgiveitacompetitiveedgeandensurethatpricesremainrelativelystablefornearfuture.
Oil & Oilseeds Daily

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29 March 2012

Oil & Oilseeds Daily

Warehousestocks:MustardseedwarehousestocksatNCDEXis9577MTcomparedto11137MTwith0MTinprocess.Thebasis

gainedtoRs607comparedtoRs585inprevioussession.

FUTURESMARKETANALYSIS

SOYBEAN

FORWARDCURVE

3650

3600

3550

3500

3450

3400

3350

3300

Spot
Feb15
Apr15
Jun15

The Forward
curve has moved on the left. The spread January

FebruaryclosedatRs14comparedto21.is59comparedto92

inlastweek.FEDstockof17000MTpluswillkeeptheJancontract
pressure. We expect the spread to widen till Rs 90. We
under

nowrecommendtobookprofit.

REFINEDSOYOIL

FORWARDCURVE

The forward curve has shifted from flat contango to steep

backwardation
in last session. The basis has corrected in last

session and is at Rs 31 compared to 26.10. The spread for

JanuaryFebruaryclosedatRs24.95comparedto23.70.

Monday

Tuesday

Monday

Wednesday

Tuesday

Thursday

Wednesday

Thursday

SOYBEAN SPREAD(FEBAPR)

Soybean:FebruaryApril
200
150
100
50
0
50
100
150

Spread
Spot
20Feb
20Apr

20Feb
0

20Apr
14
14

19Jun
29
29
15

Soyoil:FebruaryApril
50

700
690

40

680
670

30

660
650

20

640
630

10

620
610
600
590
580
570

Spot

Oil & Oilseeds Daily

Feb15

Apr15

0
10
20
1Nov 8Nov 15Nov 22Nov 29Nov 6Dec 13Dec 20Dec 27Dec 3Jan

Jun15

2015

Spread
Spot
Feb15
Apr15

Please See Disclaimer on the Last Page

2014

20Feb 20Apr
31.00
55.95
24.95

2013

10Jan 17Jan 24Jan 31Jan 7Feb

2012

19Jun
72.45
41.45
16.50

2011

2010

29 March 2012

Oil & Oilseeds Daily

FUTURESMARKETANALYSIS(Continued.)

MUSTARDSEED

FORWARDCURVE

4100

3950

3800

3650

3500

3350

3200
Spot
Apr15
May15
Jun15

The forward curve

on Thursday has moved on the left. The

spread for AprilMay

closed at Rs 33 compared to 35. 46

compared to 556
in previous session. We recommend selling
Jan and buying April at the spread of Rs 790810. We expect

thespreadtonarrowtillRs575550withatrailingstoplossof

SPOT:MUSTARDSeedSOYBEAN

Mustard SoybeanSpotSpread
1500

1200
900

600

300

300
600

900

1200

1500

1800

Spot spread of Mustard seed and Soybean continued its

uptrendinlastweek.ThespreadmadeanewhighofRs1000

and corrected. In
last trading session the spread closed at Rs
Monday

Tuesday

Wednesday

Mustardspread:AprilMay
0

Thursday

20

40

60

80

100
10Nov

20Dec

09Jan

29Jan
2011

Spread
Spot
20Apr
20May
19Jun

20Apr
607

679comparedto648.stradingatRs585comparedtoRs432
inprevioussession.

Oil & Oilseeds Daily

30Nov

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20May
574
33

19Jun
518
89
56

18Feb
2012

10Mar
2013

20Jul
475
132
99
43

30Mar
2014

19Apr
2015

29 March 2012

Oil & Oilseeds Daily

Soybean
BaseContract Contract

Spot

FEB

20Feb
20Apr
19Jun
20Aug
#N/A
#N/A
20Apr
19Jun
20Aug

Spread

FullCarry

%ofFull
Carry

0
14
29
50
#N/A
#N/A
14
29
50

44
132
223
316
#N/A
#N/A
89
179
272

0%
11%
13%
16%
#N/A
#N/A
16%
16%
18%

Soyoil

Base
Contract

Spot

Ja n

APR

19Jun
20Aug

15
36

91
184

17%
20%
Feb

20Aug

21

94

22%

Apr

JUN

Contract

Spread

FullCarry

%ofFull
Carry

20Feb
20Apr
19Jun
20Aug

31
55.95
72.45
73.3

7
23
38
54

0%
0%
0%
0%

20Apr
19Jun
20Aug

24.95
41.45
42.3

15
30
45

0%
0%
0%

19Jun
20Aug

16.5
17.35

14
29

0%
0%

20Aug

0.85

15

0%

SpotFebisshowingacarryof0%inprevious

sessioncomparedto24%.

SoybeanFebAprisshowingacarryof16%.

Soy oil JanFeb is at a carry of 42%. We

expected this carry to widen buy it has

narrowed. keeping the price structure in

backwardation.

Mustard seed SepOct

was at carry of 118%.

We recommend buying Sep and selling Oct

withatargetof105%offullcarry.Currently

thecarryisat16%.Werecommendtobook
profits.

Mustardseed

BaseContract Contract Spread FullCarry

Spot

APR

MAY
JUN

Oil & Oilseeds Daily

%ofFull
Carry

20Apr
20May
19Jun
20Jul

607
574
518
475

154
206
259
313

0%
0%
0%
0%

20May
19Jun
20Jul

33
89
132

46
93
141

71%
96%
94%

19Jun
20Jul

56
99

47
95

120%
104%

20Jul

43

49

88%

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29 March 2012

Oil & Oilseeds Daily

FundamentalTeam
FaiyazHudaniAsst.VicePresident

Oilseeds, Grains &Cotton

faiyaz.hudani@kotakcommodities.com

SudhaAcharyaSr.ResearchAnalyst

Sugar,Chana&Spices

sudha.acharya@kotakcommodities.com

MadhaviMehtaSr.ResearchAnalyst

Bullion &Energy

madhavi.mehta@kotakcommodities.com

PriyankaJhaveriSr.ResearchAnalyst BaseMetals

priyanka.jhaveri@kotakcommodities.com

TechnicalTeam
DharmeshBhatiaDeputyVicePresident

dharmesh.bhatia@kotakcommodities.com

TapanPatelSr.ResearchAnalyst

tapan.patel@kotakcommodities.com

ShabbirKayyumiResearchAnalyst

shabbir.kayyumi@kotakcommodities.com

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Thismaterialisforthepersonalinformationoftheauthorizedrecipientandwearenotsolicitinganyactionbaseduponit.Thisreportisnottobeconstruedasanoffertoselleror
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situations,orneedsofindividualclients.
Wehavereviewedthereport,andinsofarasitincludescurrentorhistoricalinformation,itisbelievedtobereliablethoughitsaccuracyorcompletenesscannotbeguaranteed.
NeitherKotakCommodityServicesLimited,noranypersonconnectedwithit,acceptsanyliabilityarisingfromtheuseofthisdocument.Therecipientsofthismaterialshouldrelyon
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Price and value of the commodity referred to in this material may go up or down. Past performance is not a guide for future performance. Certain transactions including those
involvingcommodityderivativesinvolvesubstantialriskandarenotsuitableforallinvestors.Reportsbasedontechnicalanalysiscentersonstudyingchartsofacommoditysprice
movementandtradingvolumeasopposedtofocusingonacommoditysfundamentalsandassuchmaynotmatchwithareportonacommodity'sfundamentals.
Wedonothaveanyinformationotherthaninformationavailabletogeneralpublic.Thereportisbasedoninformationfromsourceslikerespectiveindustryassociations,FICCI,CII,
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thatanyforwardlookingstatementsarenotpredictionsandmaybesubjecttochangewithoutnotice.Ourproprietarytradingmaymaketradingdecisionsthatareinconsistentwith
therecommendationsexpressedherein.
Weandouraffiliates,officers,directors,andemployeesworldwidemay:(a)fromtimetotime,havelongorshortpositionsin,andbuyorsellthecommoditiesmentionedhereinor(b)
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Theanalystforthisreportcertifiesthatalloftheviewsexpressedinthisreportaccuratelyreflecthisorherpersonalviewsaboutthesubjectcommodityandnopartofhisorher
compensationwas,isorwillbe,directlyorindirectlyrelatedtospecificrecommendationsorviewsexpressedinthisreport.
Nopartofthismaterialmaybeduplicatedinanyformand/orredistributedwithoutKotakCommodityServicesLimitedspriorwrittenconsent.
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