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COMMODITIESWhat is a commodity:

Commodity is some good for which there is demand, but which is supplied without qualitative differentiation across a market. it is fungible i.e. the same matter who produces it.

Eg: petroleum, notebookpapers, milk or copper, electricity.gold.

Commodities exchange in India:

A commodity exchange is a place where various commodities and derivatives are brought and sold. Commodities exchanges usually trade on commodity futures.

Hedging:

Commodities are subject to constant and extreme price fluctuations. Traders are the worst sufferers of the price risk. Forward contracts have come to their rescue.

A forward contract requires a buyer and a seller to take and make a delivery of a definite quantity of a particular commodity at a future specified

Hedging lessens risk since it involves the purchase or sale of a commodity with the intention of counterbalancing the profit or loss of another investment.

Speculating:

Speculators are people who are prepared to bear risks in anticipation of earning profits. Markets are granted liquidity by speculators and it is hard to conceive of a futures market devoid of speculators.

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Reasons for trading in Commodity derivatives:

Arbitrage:

Thus, traders can profit from arbitrage opportunities occurring due to price differences between two exchanges.

Shifting of Risk:

The minute a trader finalizes a deal and secures a price, he is no longer concerned by unfavourable price shifts. For example, if a seller trades a specific contract for $ 450 and soon after the price comes down to $440, there has been an unfavourable price shift but the seller has made a profit of $10. At this point, the risk has been transferred to the buyer of the contract. Speculators trade on commodities and derivatives by undertaking risks in order to maximize profits.

Information:

Exchanges produce huge volumes of data that are intensely scrutinized and monitored by a wide cross-section of people as the data provides gainful insights about the prevailing economic conditions.

Commodities types and profiles:

The different types of commodities that are available to trade are:

1) Grain

2) Energy

3) Metals

4) Softs

5) Live stocks

Grains:

The grain commodities are very active during the spring and summer.

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Corn Soybeans Wheat Rough rice

Energy:

Fuelling and heating the country, the energy commodities allow you to take advantage of everything from rising gas prices to supply disruptions in the Gulf of Mexico.

Crude oil Heating oil Unleaded oil Natural gas

Metals:

The metal commodities allow you to speculate on the price of precious metals or fluctuations in the prices of industrial metals.

Gold Silver Copper

Softs:

The softs markets cover many of the food and fibre commodities. They are often consider exotic, as many of these commodities are predominately grown in other regions of the world.

Cotton Cocoa Coffee Sugar Lumber Orange juice

Livestock:

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Pork bellies are probably the most recognized among the livestock commodities. Beef and pork are staples in most diets and these commodities offer some of the most reliable trending patterns.

Live cattle Lean hogs

List of commodity Exchanges in India

1. Bhatinda Om & Oil Exchange Ltd., Batinda.

2. The Bombay Commodity Exchange Ltd., Mumbai

3. The Rajkot Seeds oil & Bullion Merchants` Association Ltd

4. The Kanpur Commodity Exchange Ltd., Kanpur

5. The Meerut Agro Commodities Exchange Co. Ltd., Meerut

6. The Spices and Oilseeds Exchange Ltd.

7. Ahmedabad Commodity Exchange Ltd.

8. Vijay Beopar Chamber Ltd., Muzaffarnagar

9. India Pepper & Spice Trade Association, Kochi

10. Rajdhani Oils and Oilseeds Exchange Ltd., Delhi

11. National Board of Trade, Indore

12. The Chamber Of Commerce, Hapur

13. The East India Cotton Association, Mumbai

14. The Central India Commercial Exchange Ltd., Gwalior

15. The East India Jute & Hessian Exchange Ltd.

16. First Commodity Exchange of India Ltd, Kochi

17. Bikaner Commodity Exchange Ltd., Bikaner

18. The Coffee Futures Exchange India Ltd, Bangalore

19. Esugarindia Limited

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20. National Multi Commodity Exchange of India Limited

21. Surendranagar Cotton oil & Oilseeds Association Ltd

22. Multi Commodity Exchange of India Ltd

23. National Commodity & Derivatives Exchange Ltd

24. Haryana Commodities Ltd., Hissar

25. E-Commodities Ltd

Of these 25 commodities exchanges the MCX, NCDEX and NMCEIL are the major Commodity Exchanges.

Commodity trading:

The terms “commodities” and “futures” are often used to describe commodity trading or futures trading. We can think of them as generic terms to describe the markets. It is similar to the way “stocks” and “equities” are used when investors talk about the stock market. To be more specific, this is what they really mean: Commodities are the actual physical goods like corn, soybeans, gold, crude oil, etc. Futures are contracts of commodities that are traded at a futures exchange like the Chicago Board of Trade (CBOT). Futures contracts have expanded beyond just commodities.

Players Involved in Commodities Trading:

There are three different types of players in the commodity markets:

1. Commercials: The entities involved in the production, processing or merchandising of a commodity. For example both the corn farmer and Kellogg’s from the example above are commercials. commercials account for most of the trading in commodity markets.

2. Large speculators: A group of investors that pool their money together to reduce risk and increase gain. Like mutual fund in the stock market, large speculators have money managers that make investments decisions for the investors as a whole.

3. Small speculators: individual commodity traders who trade on their own accounts or through commodities broker. Both small and large speculators are known for their ability to shake up the commodities market.

How to Start Trading Commodities:

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In order to trade commodities, you should educate yourself on the futures contract specifications for each commodity and of course learn about trading strategies. Commodities have the same premise as any other investment – you want to buy low and sell high. The difference with commodities is that they are highly leveraged and they trade in contract sizes instead of shares. Remember that you can buy and sell positions whenever the markets are open, so rest assured that you don’t have to take delivery of a truckload of soybeans.

Research commodities:

Research is a major function of trading commodities. The main techniques we can use to research commodities and future markets are fundamental analysis and technical analysis. Keeping up with the latest futures news and reading research from commodity analysts will be very beneficial to commodity trading.

Finding a commodity broker:

Before you can begin trading commodities, you will need to find a good commodity broker. This section covers what you need to know before you hire a commodity broker and what you should expect from a good broker. We will also discuss many of the caution signs you want to be aware of with a broker.

Commodities future:

Commodities futures, or futures contracts, are an agreement to buy or sell a commodity at a specific date in the future at a specific price. Just like the price of bananas at the grocery store, the prices of commodities can change on a weekly or even daily basis. If the price goes up, the buyer of the futures contract makes money, because he gets the product at the lower, agreed-upon price and can now sell it at the higher, market price. If the price goes down, the seller makes money, because he can buy the commodity at the lower market price, and sell it to the buyer at the higher, agreed-upon price.

If commodities traders had to actually deliver the product, very few people would do it. Instead, they can fulfil the contract by delivering proof that the product is at the warehouse, by paying the cash difference, or by providing another contract at the market price. As you can easily see, it can get very complicated very fast, and they use a lot of strange terms, so I won’t try to explain more.

The important things to know are:

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Commodities futures, since they are traded on open market, do a great job of accurately assessing the price of each commodity.

They are future contracts they also forecast the value of the commodity into the future.

The values are set by commodities traders and analysts who spend all day everyday researching their particular comodity.this means they are very good at it, so we can totally trust their estimation. The forecast are also based on today’s informatio, so the North Korea suddenly tests a nuclear weapon, the commodities prices will change dramatically.

Best way to either invest in or monitor commodities futures is through a commodities index or commodities fund. These can give you a single number that takes into account the broad spectrum of commodities futures that are occurring at any given time, such as the gsci.

The most commonly reviewed commodities are oil and gold. Many other agricultural products such as pork bellies and wheat are traded, but the individual investor doesn’t really need to be concerned with them.

Actively traded commodity:

Liquidity is very important to active commodity traders. The higher the volume of a futures contract on a commodity, the easier it is to get in an out of a market at the truest price - less slippage. Commodities with high volume are the often the choice for day traders and many large traders. Low volume commodity markets are often prone to wild price swings.

The financial futures are sometimes lumped in with comodities, but they are actually just futures markets. The E-mini S&P 500 and Eurodollars markets are among the highest volume future markets, but we will just concentrate on commodities for these ranking.

How Does Commodities Trading Affect the US Economy?

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Commodity trading impacts the economy by making public the analysts forecasts of future prices of the most important market goods. For example, one of the most widely watched commodities is oil. The price of oil changes daily, which has an impact on every good and service produced in the U.S economy.

As traders take into account all information regarding oil supply and demand, as well as geopolitical considerations, this affects oil prices. It is these assumptions behind oil prices that affect the economy so significantly.

COMODITIES AT MCX:

The products of mcx are bullions, pulses, metals, cereals, energy, whether, oil and oil seeds, plantations, fiber, spices and others. Among all of these bullions, pulses, metals and oil and oil seeds will have more increase rate.

Bullions: In bullions they will be gold, silver, gold guinea, goldHNI ,goldm, platinum, silverHNI ,silverM.

Gold:

Gold is the oldest precious metal known to man and thousands of years it has been valued as a global currency, a commodity, an investment and simply an object of beauty.

MAJOR CHARACTERISTICS OF GOLD:

Gold is unique as it is both a commodity and monetary assets. Its stabilities and high value makes it virtually indestructible and ensures

that it is almost always recovered and recycled. There is no true consumption of gold in the economic sense, as the stock

of gold remains essentially constant while ownership shifts from one party to another.

Although gold mine production is relatively inelastic, recycled gold (or scrap) ensures there is a potential source of easily traded supply when needed, and this helps to stabilise gold price.

Economic forces that determine the price of gold are different from, and in many cases opposed to the forces that influence most financial assets.

Indian Gold Market

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India is the world's largest consumer of gold. Indians normally buy about 25 per cent of the worlds gold, purchasing around 700 - 750 tonnes of gold every year.

However, the sharp price increase in 2008 and 2009 has impacted demand with total demand in 2008 dipping to 660 tonnes. It is further expected to shrink in 2009 with demand in first three quarters of 2009 totalling only around 265 tonnes against 553.5 tonnes in the same period of the previous year.

As India's domestic primary production of gold is very less, at around 2-3 tonnes a year, the country imports most of its domestic requirement.

Thus, India is also the largest importer of the yellow metal and has averaged imports of around 600 tonnes a year. However, 2008 imports dipped to around 400 tonnes of gold and it is further expected to dip to around 200-220 tonnes in 2009 owing to high prices.

India's gold demand is firmly embedded in cultural and religious traditions. It is also valued in India as a savings and investment vehicle and is the second preferred investment after bank deposits.

Gold hoarding tendency is well engrained in the Indian society and unofficial stocks held by Indians is estimated to be well above 15,000 tonnes, which is around 9% of the total global gold stocks.

Domestic consumption is dictated by monsoon, harvest and marriage season. Indian jewellery off take is sensitive to price increases and even more so to volatility.

Facilities for refining, assaying, making them into standard bars, coins in India, as compared to the rest of the world, are insignificant, both qualitatively and quantitatively.

In July 1997 the RBI authorized the commercial banks to import gold for sale or loan to jewellers and exporters. At present, 13 banks are active in the import of gold. This reduced the disparity between international and domestic prices of gold from 57 percent during 1986 to 1991 to 8.5 percent in 2001.

Market moving factors:

Indian gold prices are highly correlated with international prices. However, the fluctuations in the INR-US Dollar impact domestic gold prices and have to be closely followed.

The global prices are driven by a host of factors with macro-economic factors like strength of the economy, rising importance of emerging

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markets, currency movements, interest rates being major influencing factors.

Supply-demand is a major influencer, amid rising global investor demand and almost stable supplies.

Shifts in official gold reserves, reports of sales/purchases by central banks act as major price influencing factors, whenever such reports surface.

The investment in gold is influenced by comparative returns from other markets like stock markets, real estate other commodities like crude oil.

Domestically, demand and consequently prices to some extent are influenced by seasonal factors like marriages. The rural demand is influenced by monsoon, agricultural output and health of the rural economy.

Facotor affecting gold: There are three factors affecting the gold:

Weak us dollar Growth in demand for jewellery Increase in demand for exchange traded paperback products.

Weak US Dollar:

Projections about a declining dollar due to an ever-increasing twin deficit supported by many investment veterans are met by much denial from politicians as well as from investors. As long as foreigners are willing to pour in the amount of $2 billion dollars every working day, the dollar won't crash. But if foreign confidence were to wane, the US dollar will be heading south. No matter how you look at the US twin deficits and America's future fiscal liabilities, this problem is huge and some painful adjustments not only seem to be necessary but unavoidable as well. It should be obvious that one of these major painful adjustments will be a massive devaluation of the US dollar. It seems that the idea of a dollar devaluation is gaining support from the Fed when the President of the Dallas Fed, Robert McTeer recently said: "over time, there is only one direction for the dollar to go - lower." Former ECB president Wim Duisenberg, quoted by Spanish Newspaper El Pais, recently said: "A dollar devaluation seems inevitable due to the tremendous US Current Account deficit." Furthermore he recently said on Dutch television that we can only hope and pray for a smooth economic transition in the US. Why is this so important? Simple, the US dollar is the key driver for Gold; as the dollar goes, so will gold; but in the opposite direction. Gold is the anti-dollar with a high inverse

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correlation to the dollar! In the end, gold is still a monetary asset and trades like a currency.

Growth in Demand for Jewellery:

In spite of the convergence of Diamond and Palladium, the demand for gold jewellery has seen a regular growth year on year. Countries, which are primarily responsible for this growth, are India, China, Italy, Turkey and the USA. The demand for consumption of gold in jewellery was 6% higher at 735 tonnes and also comprised a new first-quarter record. The US, which accounts for 10 % of world gold demand, is also one of the markets where public taste in gold jewellery is enjoying a renaissance. The renewed interest in gold also extends to Japan, a market that showed a 19% increase in demand. The Indian market – the world’s largest for gold demand – was 23 % higher following the marriage and festival period which, in turn, has led to restocking by retailers. The earthquake in India, however, is unlikely to hit demand significantly as it occurred in an area which comprises only 5% of the total Indian consumption. There were sharp falls in demand in Turkey and Taiwan - down 38% and 31% respectively. This was due to economic difficulties and continued weakness in investment demand.

Increase in demand for exchange traded paper backed products:

For the first time in history, gold can be purchased like any listed stock at select stock exchanges of the world like London Stock Exchange, Australian Stock Exchange (Gold Bullion Securities) and New York Stock Exchange (Street Tracks Gold). The World Gold Council initiated Electronic Traded Funds have displayed very good performance and growth in volumes since launch.

Factors influencing the gold price:

Today, like all investments and commodities, the price of gold is ultimately driven by supply and demand Unlike most other commodities, hoarding (saving) and disposal plays a much bigger role in affecting the price, because most of the gold ever mined still exists in accessible form and is potentially able to come on to the market for the right price.

There are three factors influencing gold

Bank failures

Low or negative interest rates

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War, invasion, looting, crisis.

Bank failures:

When dollars were fully convertible into gold, both were regarded as money. However, most people preferred to carry around paper bank notes rather than the somewhat heavier and less divisible gold coins. If people feared their bank would fail, a bank run might have been the result. This is what happened in the USA during the great depression of the 1930s, leading president rosevellet to impose a national emergency and to outlaw the ownership of gold by US citizens.

Low or negative real interest rates:

If the return on bonds, equities and real estate is not adequately compensating for risk and inflation then the demand for gold and other alternative investments such as commodities increases. An example of this is the period of stagflation that occurred during the 1970s and which led to an economic bubble forming in precious metal.

War, invasion, looting, crisis:

In times of national crisis, people fear that their assets may be seized and that the currency may become worthless. They see gold as a solid asset, which will always buy food or transportation. Thus in times of great uncertainty, particularly when war is feared, the demand for gold rises.

Silver:

General characteristics:

Silver's unique properties make it a very useful 'Industrial

Commodity', despite it being classed as a precious metal. Demand for silver is built on three main pillars; industrial uses,

photography and Jewellery & silverware accounting for 342, 205 and 259 million ounces respectively in 2002.

Just over half of mined silver comes from Mexico, Peru and United States, respectively, the first, second and fourth largest producing countries. The third largest is Australia.

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Primary mines produce about 27 percent of world silver, while around 73 percent comes as a by-product of gold, copper, lead, and zinc mining.

The price of silver is not only a function of its primary output but more a function of the price of other metals also, as world mine production is more a function of the prices of other metals.

The tie between silver and economic activity is strong, given that around two-thirds of total silver fabrication is in the industrial and photographic sectors.

Often a faster growth in demand against supply leads to drop in stocks with government and investors.

Economically viable primary silver mine is a function of the world silver price level.

Indian Scenario:

Silver imports into India for domestic consumption in 2002 was 3,400 tons down 25 % from record 4,540 tons in 2001.

Open General License (OGL) imports are the only significant source of supply to the Indian market.

Non-duty paid silver for the export sector rose sharply in 2002, up by close to 200% year-on-year to 150 tons.

Around 50% of India's silver requirements last year were met through imports of Chinese silver and other important sources of supply being UK, CIS, Australia and Dubai.

Indian industrial demand in 2002 is estimated at 1375 tons down by 13 % from 1,579 tons in 2001. In spite of this fall, India is still one of the largest users of silver in the world, ranking alongside Industrial giants like Japan and the United States.

By contrast with United States and Japan, Indian industrial off take for fabrication in hardcore industrial applications like electronics and brazing alloys accounts for only 15 % and the rest being for foils for use in the decorative covering of food, plating of Jewellery and silverware and jari.

In India silver price volatility is also an important determinant of silver demand as it is for gold.

Factors Affecting the Price of Silver:

There are various factors that affect the price of Silver. Some of those factors are: Private and Institutional Investors, the large concentrated

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short position and Industrial demand.

From 1973 the Hunt Brothers began to corner the market. They bought enough to cause the spike in 1980 to $49.45 per troy ounce. Soon after the price fell back down due to the New York Mercantile Exchange and the intervention of the Federal Reserve. In 1997 Warren Buffet purchased 130 million troy ounces of silver. Also, in April of '06 is hares launches a silver exchange traded fund which is called the iShares Silver Trust. As of April '08 the iShares Silver Trust held 180 million troy ounces of silver as reserves.

The large concentrated Short Positions in silver also contribute to the price. As of April '07 it shows that the four or fewer largest traders are holding 90% of all short silver contracts. The total between these traders is equal to a total short of 245 million troy ounces. This is the equivalent to 140 days of production.

Industrial Demand is one of the major factors that influence the price of silver. Although silver is relatively scarce, it is the most plentiful and least expensive of the precious metals. 95% of annual silver consumption comes from the three main areas of industrial uses, jewellery, silverware, and photography.

Factors influencing the silver:

Private and institutional investors:

From 1973 the hunt brothers began cornering the market in silver, helping to cause a spike in 1980 of $49.45 per troy ounce and a reduction of the gold/silver ratio down to 1:17.0 (gold also peaked in 1980, at $850 per troy ounce) In the last nine months of 1979, the brothers were estimated to be holding over 100 million troy ounces of silver and several large silver futures contract However, a combination of changed trading rules on the new York merchantable exchange (NYMEX) and the intervention of the federal reserve put an end to the game.

In 1997, warren buffet purchased 130 million troy ounces (4,000 metric tons) of silver at approximately $4.50 per troy ounce (total value $585 million). On May 6, 2006, Buffet announced to shareholders that his company no longer held any silver.

In April 2006 i shares launched a silver exchange traded fund called the iShares Silver Trust (NYSE:SLV), which as of April 2008 held 180 million troy ounces of silver as reserves.

The large concentrated short position:

The CFTC publishes weekly commitments of trader’s report, which shows that the four or fewer largest traders are holding 90% of all short silver

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contracts. Furthermore, these four or fewer traders were short a total of 245 million troy ounces (as of April 2007), which is equivalent to 140 days of production. According to Ted Butler, one of these banks with large silver shorts, JP Morgan Chase, is also the custodian of the SLV silver ETF. Some silver analysis has pointed to a potential conflict of interest, as close scrutiny of Comex documents reveals that ETF shares may be used to 'cover' Comex physical metal deliveries. This leads analysts to speculate that some stores of silver have multiple claims upon them. On 2008-09-25 the CFTC relented and probed the silver market after persistent complaints of foul play

Industrial demand:

The use of silver in items such as electrical appliances and medical products has increased since 2001. New applications for silver are being explored in batteries, superconductors and microcircuits, which may further increase non-investment demand. The expansion of the middle classes in emerging economies aspiring to Western lifestyles and products may also contribute to a long-term rise in industrial usage. Even so, due to the advent of digital cameras the enormous reduction in the use of silver halide-based photographic film has tended to offset this.

Comparison between gold and silver rates:

YEAR SILVER PRICE

Yearly cum avg

GOLDPRICE

Yearly cum avg

GOLD/SILVER

RATIO

1840 1.29 20 15.55

1900 0.64 20 31.9

1920 0.65 20 31.6

1940 0.34 30 97.3

1960 0.91 35 38.6

1970 1.63 35 22.0

1980 16.39 612 37.4

1990 4.06 383 94.3

2000 4.95 279 56.4

2005 7031 444 60.8

2009 14.67 972 66.3

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2010 17.44 1135 65.1

Pulses:

In pulses they will be chana.

Chana:

Chana belongs to leguminasae family and there are two main types - Desi and Kabuli. A Desi chickpea is the main type grown in India.

India's chana production fluctuates between 4-7 million tons and is normally 40% of India's total pulse production of 12-15 million tons

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India's chana production in 2003-04, chana production is 5.33 million tons out of a total pulse production of 15.23 million tons.

The major producing states are Madhya Pradesh (1.5-2.5 million tons, Uttar Pradesh (0.7-0.85 million tons), Rajasthan (0.5-2.5 million tons) and Maharashtra (0.5-0.7 million tons).

Chana is a rabbi crop and is sown from Nov to December and harvested from Feb to March. The peak arrival period begins from March-April at the major trading centres of the country.

India accounts for 2/3rd of the world's chickpea production. India imports around 3-4 lakh tons of chickpeas annually. The major country from where India imports chickpeas is Canada, Australia, Iran and Myanmar.

Indian chana markets are highly fragmented, with very long value chain. The major players in the value chain are commission agents, brokers, stockists, wholesale traders, dal mills, wholesalers (dal) and retail outlets. The information flow between these participants is restricted and very slow.

Major Trading Centers:

Indore, Bhopal, Vidisha in Madhya Pradesh. Jalgaon, Latur, Mumbai, Akola in Maharashtra.

Jaipur, Bikaner, Kota, Jodhpur, Sriganaganagar, Hanumangarh in Rajasthan.

Other major centers are Delhi, Chennai, Kanpur, Hapur, Hyderabad, Vijayawada, Gulbarga, Sirsa, Jalandhar, Ludhiana, Sangrur.

Market Influencing Factors:

Chana can withstand moisture stress to a certain extent. However the production highly fluctuates between years, depending on the rains received and the moisture availability in the soil.

The sentiments of traders play a significant role currently, as a consequence of the lack of free flow of information.

Stocks present with stockiest and the stocks to consumption ratio. Imports and the crop situation in the countries from where imports

originate, viz, Canada, Australia, Myanmar. There is high substitutability between pulses in India among the

consumers. So the price of the other major pulses like tur, yellow peas etc also influence the prices of chana.

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Past data of pulses:

The Delhi grains and pulses market held sustained supplies and lack of buying interest. Mill-quality wheat edged down by Rs 18/20 to Rs 1120/1124 per quintal as daily arrivals stood higher at 28000-30000 bags. Softening of wheat also pulled down wheat flour by Rs 5/10 per 50 kg bag amid increased offerings by roller-flour mills. Interestingly, though wholesale prices have come down significantly, retail prices of atta are quoting is quoting as high as 160/170 per 10 kg bag. Wheat procurement for central pool has so far reached 240 lakh tonne. Weak export demand also eased fine rice. Rice fine such as 1121 sela and steam declined by Rs 300/400 to Rs 3700/3800 and Rs 4900/5000 per quintal on heavy selling by stockists. Pulses also witnessed easing trend. While urad (black matpe) dipped Rs 200 to Rs 5040/5050 per quintal on weak Mumbai advices, urad dal too drifted lower by Rs 200/300 per quintal with prices at the high end quoting at Rs 7600/7900 per quintal. Moong (green gram) fell Rs 200/250 to Rs 6600/6750 per quintal following increased arrivals from West Bengal and Madhya Pradesh. Discouraging advices from masoor (lentil) producing centres such as Kota, Bundi, Baran, Indore, Lalitpur and Jhansi pulled down masoor bold from Rs 3550/3850 to Rs 3450/3750 per quintal. Tur (pigeon pea) maruti quality slumped from Rs 4800 to Rs 4600 per quintal on the back of sustained supplies of tur kachri (with 17-20 per cent damaged grains) from MP and Bihar. Low quality tur was priced as low as 3800/4000 per quintal. Tur dal patka declined by Rs 300 to Rs 6000/6100 per quintal on stockists’ selling. Rajmash chitra edged down by Rs 50/75 with flat grain rajmash quoting at Rs 3850/3875 per quintal amid increased offerings by stockists. However, prices later steadied on pause in selling. Kabuli gram bucked the easing trend and closed firm on upcountry demand. Gram on the spot market tumbled by Rs 100 to Rs 2090/2100 per quintal on stockists’ selling. According to market men, gram on the spot market largely followed the weak futures market trend. Gram end week improved by Rs 15/20 as its prices in the futures market edged up by Rs 20/25 to Rs 2097/2098 per quintal.

Factors affecting the chana:

Rainfall pattern and temperature

Total area covered

Arrivals in the markets

Demand from millers, stockists and retailers

Production in the International markets.

Production and trends of other pulses namely Urad and Tur in domestic and international markets and price of Yellow Pea.

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Import and export policies by the Indian Govt.

Overview:

The demand for chana is getting more and the farmers are also not eilling to sell at lower prices on anticipation of some recovery during June-august. So huge stocks of chana in the spot markets may restrict major rise in prices in medium term. Huge stocks of chana in the spot markets may restrict major rise in prices in medium.

Metals:They will be aluminium, copper, lead, nickle, tin, zinc, mild steel ignot, and billets.

Aluminum: Characteristics of aluminum:

Aluminum is the third most abundant element in the earth crust. In nature however it only exists in very stable combinations with other materials (particularly as silicates and oxides) and it was not untill1808 that is existence was first established.

Aluminum is light. Its density is only one third that of steel. Aluminum is resistant to weather, common atmosphere gases and a wide range of liquids, aluminum has a high reflectivity, and therefore finds more decorative uses. Aluminum has high elasticity, which is an advantage in structures under shock roads.

Aluminum keeps its toughness down to very low temperatures, without becoming brittle like carbon steels. It is easily worked and formed.

Supply and Demand:

Global Scenario: Aluminum ore, most commonly bauxite, is plentiful and occurs mainly in

tropical and sub-tropical areas - Africa, West Indies, South America and Australia. There are also some deposits in Europe

The leading producing countries include the United States, Russia, Canada, the European Union, China, Australia, Brazil, Norway, South Africa, Venezuela, the Gulf States (Bahrain and United Arab Emirates), India and New Zealand; together they represent more than 90 percent of the world primary aluminum production.

The largest aluminum markets are North America, Europe and East Asia. The global production of aluminum is about 27.7 and 28.9 million tons in

2003 and 2004 respectively.

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China, Russia, Canada and United States produced about 6.1, 3.6, 2.64 and 2.5 million tons of aluminum in year 2004 respectively.

Indian Scenario: India is considered the fifth largest producer of aluminum in the world. It is estimated at about 3037 million tonnes for all categories of bauxite

(proved, probable and possible). With the present level of consumption of aluminum, the identified reserves would have an estimated life of over 350 years. India's reserves are estimated to be 7.5 per cent of the total deposits and installed capacity is about 3 per cent of the world.

In terms of demand and supply, the situation is not only self-sufficient, but it also has export potential on a competitive basis. India's annual export of aluminums is about 82,000 tonnes.

India’s annual consumption of Aluminum is around 6.18 lakh tons and is projected to increase to 7.8 lakh tones by 2007.

About a decade back, the primary Indian aluminum producers were BALCO, NALCO, INDAL, HINDALCO and MALCO. Of the five, two (BALCO and NALCO) were in the public sector while the other three were in the private sector As a result of the process of liberalization of trade in aluminum, India has emerged as a net exporter of aluminum, on competitive terms. Government monopoly, in terms of aluminum production, removal of price and distribution control over aluminum, has been diluted in favor of private sector. The ownership pattern in private sector has undergone changes. With the takeover of INDAL by the HINDALCO, it has emerged as the major producer of aluminum in the country.

World aluminum markets:

Lme, tocom, shfe and nymex are the important international markets that provide direction to the aluminum prices.

DemandWith some many applications it is of little surprise that aluminium has rapidly become the largest base metal in terms of tonnage consumed annually. With all aspects of its use likely to benefit from continuing growth in the developed economies aluminium has a stable outlook, however, with the rapid industrialisation and urbanisation of countries like China and India, aluminium demand is set to accelerate sharply. Primary aluminium demand has risen from 2 million tonnes in 1950, to 9.5 million tonnes in 1970, to 15 million tonnes in 1990 and is expected to rise to 23 million tonnes in

SupplyProduction of primary aluminium is done in three stages. It starts with the

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mining of bauxite, a reddish-brown aluminous earth found in tropical latitudes in Australia, South America, India, the Caribbean and Africa. Bauxite is then refined to produce alumina, which is then smelted to produce aluminium. To produce one tonne of primary aluminium takes two tonnes of alumina, which in turn takes four tonnes of bauxite. The reduction of aluminium from its oxide, alumina, is very power-intensive, hence why significant parts of world primary aluminum production are located near cheap energy sources, whether it be hydro-electric power in Canada or near the oil and gas fields in the Middle East. Interestingly, when OPEC limited oil exports in the Middle East in the 1970's, oil-producing countries found themselves with surplus oil production capacity, which they were not allowed to export. Instead they converted the oil and gas to electricity and produced aluminium, which could then be exported. A very clever way to get around the OPEC restrictions.

It is important to understand the huge energy requirement need to make primary aluminium. The Hillside smelter in South Africa produces around 460,000 tpy of aluminium, but to do so takes the of equivalent to about 5% of all the electricity consumed in South Africa.

Recycled aluminium plays an important part of the supply chain as aluminium's use in packaging often has a short life span. To produce aluminium from scrap aluminium costs a fraction of the cost of producing primary aluminium. To produce one tonne of aluminium from scrap consumes only 5% of the amount of electricity that it takes to produce one tonne of primary aluminium.

Factors affecting supplyThe production of aluminium requires alumina and uninterrupted supply of electricity. Compared with the production of metals, aluminium's requirements are fairly straightforward. However, in recent years there have been a host of issues, which have affected supply. Most of these have been to do with electricity. In the 2001, energy shortages in the US sent electricity prices spirallying higher to the extent that it was more profitable for some aluminium smelters to stop producing aluminium and to sell their electricity quotas to other users. The cutbacks were enough to turn the aluminium price around. Back in the mid-1990's, lack of rainfall in North America restricted hydro-electrical output and in turn this forced aluminium producers to cut back aluminium production. More recently, hurricane damage in the Caribbean in 2004 affected alumina production and as this threatened alumna supply to the smelters, it led to higher aluminium prices. Likewise, China's growth spurt has left it short of power capacity, so at peak energy usage times, such as during the summer when air conditioning consumers huge amounts of energy, aluminium smelters sometimes have to cut production, to free-up electricity for other users. These

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are a few of the factors that can impact the aluminium market.

Copper:

Copper ranks third in world metal consumption after steel and aluminum. It is a product whose fortunes directly reflect the state of the world's economy.

Supply and Demand:

Global Scenario:

Economic, technological and societal factors influence the supply and demand of copper. As society's need for copper increases, new mines and plants are introduced and existing ones expanded.

Land-based resources are estimated at 1.6 billion tons of copper, and resources in deep-sea nodules are estimated at 0.7 billion tons.

The global production of refined copper is around 15 million tons.

The major copper-consuming nations are Western Europe (28.5%), the United States (19.1%), Japan (14%), and China (5.3%).

Copper and copper alloy scrap composes a significant share of the world's supply.

The largest international sources for scrap are the United States and Europe. Chile, Indonesia, Canada and Australia are the major exporters and Japan, Spain, China, Germany and Philippines are the major importers.

Indian Scenario:

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The size of Indian Copper Industry is around 4 lakh tons, which as percentage of world copper market is 3 %.

Birla Copper, Sterilite Industries are two major private producers and Hindustan Copper Ltd the public sector producers.

India is emerging as net exporter of copper from the status of net importer on account of rise in production by three companies.

Copper goes into various usages such as Building, Cabling for power and telecommunications, Automobiles etc. Two major states owned telecommunications service providers; BSNL and MTNL consume 10% of country's copper production. Growth in the building construction and automobile sector would keep demand of copper high.

World copper markets:

Lme and nymex are the two international markets, which provide direction to the copper prices

The eight leading refining nations viz us, japan, chile, Canada, zambie, beligum, and the federal republic of germeny account for 67% of total refined metal production.

DemandBetween 1900 and 2000, copper demand grew from 500,000 tonnes to around 13,000,000 tonnes, with growth accelerating since the 1950's. With some many widespread uses it is not surprising copper demand keeps growing and now with China, India and many other developing countries starting to industrialise and urbanise, demand is likely to grow from strength to strength. Per capita demand for copper rises as GDP per capita rises. Japan consumes around 12kg per capita, North America consumers around 10kg per capita and Europe around 9kg per capita. The large populations of China, India, Eastern Europe and South America are all consuming less than 2kg per capita - this is a huge indicator of whatliseaheadforcopperdemand.

SupplyCopper is not a particularly rare metal and it is produced in many countries, Chart 2 shows the geographical distribution of primary supply. Today copper supply is made up from two sources, the majority, 88%, comes from primary production, that new copper that is mined from the ground, but of growing importance is secondary supply which accounts for 12% of total refined copper supply. Secondary supply comes from recycling copper scrap.

Primary supply involves mining copper ores, which generally come in two forms, copper suphides or copper oxides. Depending on the type of ore mined,

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the ore is processed by one of two methods. Copper sulphide ore is first concentrated then smelted and then refined, each of these stages is a separate process and can be carried out at a different location. Whereas copper oxide ore is crushed and the copper is then extracted from the crushed ore by disolving the copper in acid and the collecting the copper from the acid via electrolysis. This process is called Solvent extraction-electrowinning, SXEW for short. SXEW accounts for some 15% of primary copper production.

Factors affecting copper prices:

The wide production base means there are numberous factors that can affect production and therefore prices. In North and South America, production is often affected by labour unrest, in parts of Asia and Africa production can be affected by political unrest, take for example the closurse of the Bourgainville mine in Papua New Guinea and the decimation of production in Zambia. In addition, weather is an important factor affecting supply, with floods and droughts either hitting the production process or the transport of raw materials. New production also takes years to commission, as the scale of mining is large, it takes enormous financing, requires endless environmental permissions and needs extensive infrastructure as well. All these factors make it hard for the market to balance supply and demand.

With such a large and diverse market it is little surprise that copper's fundamentals are continuously changing and as they do, so does the price. The copper prices changes constantly as the market attempts to balance supply and demand at any given time. These price fluctuations generate risk and opportunity to different participants in the market and the metal exchanges around the world provide the means for all those involved with the market to either hedge their risk or take on risk as an investor/speculator

Factors Influencing Copper Markets

Copper prices in India are fixed on the basis of the rates that rule on LME the preceding day.

World copper mine production through exploration of new mine and expansion of existing mine.

Economic growth of the major consuming countries such as China, Japan, Germany etc.

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Growth and development in the Building, electronics and electrical industry

Lead:

Characteristics of lead:

Lead is a very corrosion-resistant, dense, ductile, and malleable blue-grey metal that has been used for at least 5,000 years. Early uses of lead included building materials, pigments for glazing ceramics, and pipes for transporting water. Today's major use of lead is in lead-acid storage batteries. The electrical systems of vehicles, ships, and aircraft depend on such batteries for start-up, and, in some cases, batteries provide the actual motive power. It is also for soundproofing in office buildings, schools, and hotels. It is widely used in hospitals to block X-ray and gamma radiation and is employed to shield against nuclear radiation both in permanent installations and when nuclear material is being transported. .

Supply & Demand Scenario:

Domestic Scenario:

Lead production equalled approximately 82,000 tonnes in 2004, mostly from secondary sources.

The main constraint in lead production in the country is the lack of lead ore reserves, which necessitates large-scale imports and recycling.

Lead demand in India was estimated at 150,000 tonnes for 2004. Due to huge gap in demand-supply, India imported nearly about 50% of its domestic demand.

The major suppliers for the imports were China, the Republic of Korea and Australia: 54%, 15% and 10% respectively.

The domestic industry is characterized by the presence of only a few players in the primary segment. The primary lead industry in India is divided between the following main players: Binani Industries Limited and Sterlite Industries (India) Ltd. (Hindustan Zinc Ltd.). Due to increasing use of lead in domestic market both players are expanding their smelting capacities for lead.

World Scenario:

Usa, japan, china,eu and India are the major consumers of lead. Supply is controlled by Australia and china.

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Lead in the global market is traded as soft lead, animated lead, lead alloys and copper-base scrap.

Mild Steel Ingots:

Major characteristics:

Steel is an alloy consisting mostly of iron, with varying amounts of other elements like carbon, manganese, chromium, silicon, oxygen etc. Different grades of steel are produced by adjusting the chemical composition and by slight variations in the different stages of steel-making process. Currently, there are more than 3000 catalogued grades of steel available.

Steel is one of the most common materials in the world and is a major component in buildings, infrastructure, tools, ships, automobiles, machines, and appliances. It is environment friendly, can be recycled and requires considerably less energy to produce than some other metals.

Steel market is primarily divided into two categories - flat and long.

Flat Steel: Plate or a (hot or cold) rolled strip product. Typical products are plates, HR coils, HR sheets, CR coils, CR sheets, Galvanised plates (GP), Galvanised coils (GC), pipes etc

Long Steel: Rod or a bar. Typical rod products are the reinforcing rods made from sponge iron for concrete, ingots, billets, engineering products, gears tools etc.

Global Scenario:

Global steel production grew enormously in the 20th century from a mere 28 million tonnes at the beginning of the century to 781 million tonnes at the end. Further progress has been seen in the first decade of the 21st century. The global crude steel production in 2008 is reported to be 1,330 million tonnes.

Steel consumption of a country increases when its economy is growing, as its government invests in infrastructure and transport, and the nation sees building of new factories and houses. Construction industry accounts for around 50% of the global steel consumption. Cars, which accounts for 13% of the global steel consumption is the second largest consuming sector

The main producing and consuming regions of steel have shifted from the developed world to the developing regions with Asia accounting for more than 55% of the global steel production. The five largest producers of

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crude in 2008 are China (500 million tonnes), Japan (199 million tonnes), US (91 million tonnes), Russia (68 million tonnes) and India (55 million tonnes)

Indian Scenario:

The Indian steel industry has entered into a new development face from 2005-2006 riding high on a resurgent economy and rising demand for steel. The sharp rise in production has lead to India becoming the fifth largest producer of steel in the world, with a 2008 crude steel production of above 55 million tonnes.

The groth face in India steel industry is expected to pick pace further. India steel production is increased anomaly by10% till 2012.

The scope of raising the total consumption of steel in India is huge given that pre capita income of steel is 40% compared to 150 kgs across the world and 250 kgs in china.

Nickel:

Characteristics of nickel:

Nickel finds its usage in various industries such as engineering, electrical and electronics, infrastructure, automobile and automobile components, packaging, Batteries etc.

Among base metals Nickel is the most volatile owing to its strong demand and tight supply.

About 65 per cent of nickel is used in manufacture of stainless steels, and 20 per cent in other steel and non-ferrous including "super" alloys, often for highly specialized industrial, aerospace and military applications.

Supply and Demand:

Major producers of Nickel are Russia, followed by Australia, Canada, New Caledonia and Indonesia, which represents over 65% of total world production.

World primary nickel consumption is about 1 million tons. Consumption centers are Japan 2 lakh tons and European Union 3.74 lakh tons.

Rapid expansion of global stainless steel production is fuelling demand for primary nickel.

Indian nickel market:

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Nickel market in India is of total import dependent India imports around 30000 of nickel

Import duty on nickel is 15%

With the growth in the stainless steel sector nickel import demand is expected to increase in the coming years.

Cereals:

Barley:


Barley (Hordeum vulgare L.) (Hindi name: Jau), a cereal grain derived from an annual grass is the fourth most important cereal crop in the world after rice, wheat and maize.

Barley is very adaptable and is a widely grown crop. It is cultivated as a summer crop in temperate areas and as a winter crop in tropical areas. Barley has a short growing season and is also relatively drought tolerant. However, it is a tender grain and care has to be taken in all stages of its growth and harvest.

Barley is used as livestock feed, human food and barley malt. While, historically, livestock consumed most of barley produced globally, this is no more the case now. Currently food and industrial consumption of barley is more prominent.

Global scenario:

The annual global barley production has been in the range of 130-140 million tonnes in the recent years. However, in 2008-2009 it is estimated to have risen sharply to 158 million tonnes. The total average production of all-coarse in the recent year has been around 1000 million tones.

European Union, Russia, Ukraine, Canada, Australia, Turkey and USA are the major producers of barley accounting for around 75% of the total global production, with average production in these regions being around 55, 18, 10, 10, 6, 6, 4-5 million tonnes respectively in the recent years.

Following corn, barley is the second largest coarse cereal traded globally. The global trade in barley is reported to be around 17-18 million tonnes, with Ukraine (4-5 million tonnes), Russia (2-3 million tonnes), Australia (2-3) and EU-27 (2-3 million tonnes) being the major global exporters.

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The major importing nations are Saudi Arabia (6-8 million tonnes), China (1-1.5 million tonnes) and Japan (1-1.5 million tonnes. While, Saudi Arabia imports barley mainly for feed, Japan and China import it for both feed and malt production

The global malt production is estimated to be around 22 million tonnes, more than 90% of which is produced from barley. It is estimated that around 94% of global malt production is used for making beer. The EU accounts for approximately 42% of the world's malt production.

Indian Scenario:

Barley is cultivated as a rabbi crop in India, with sowing being undertaken from October to December and harvesting from March to May.

India's annual production of Barley has been steadily around 1.2-1.5 million tonnes in the recent years, with production in 2008-09 estimated to be around 1.54 million tonnes. The area under cultivation has also stabilized at around 0.7-0.8 lakh hectares, with a per hectare yield of around 1944 kg.

Latest state wise data available is that of 2005-06 from the Ministry of Agriculture. But it gives a fair picture of land use for the crop of barley. The major producers of Barley in the country are Rajasthan (40%), Uttar Pradesh (34%), Madhya Pradesh (8%), Haryana (6%) and Punjab (5%). Some cultivation is also undertaken in Bihar, Himachal Pradesh, and Uttaranchal.

In addition, to direct human consumption barley is utilized by the beer industry, food processing industry and feed manufacturing industry in India. Annual demand from beer and feed industry is estimated to be around 60,000 tonnes and 25,000 tonnes respectively.

India's barley production is projected to increase to around 2 million tonnes in a couple of years to meet the rising demand for barley malt.

Major Indian trading centers:

The major markets are located in rajasthan and Madhya pradesh. The three largst markets are kota,ramganj mandi and baran in rajasthan.

Wheat:


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Wheat is one of the most three-cereal crops along with maize and rice. It is repotedly grown as early as 9000bc and now it is grown in all parts of the country.

Wheat is globally an important source of starch , glutan.

Different variety of wheat is grown in the world maily they are three types are used in modern food production are: soft wheat, hard wheat and triticam compactum.

Global scenario:

The annual global wheat production has been in the range of 600-630 tonnes in the recent years. However, in 2008-09 it is estimated to have risen sharply to 689 million tonnes. The combined production of all cereals in 2008-09 is estimated to be 2525 million tonnes.

EU-27, China, India, USA and Russia are the five major producers of wheat accounting for close to 70% of the total global production, with 2008-09 production in these regions being 151, 112.5, 78.6, 68 and 63.8 million tonnes respectively.

Wheat is the most important cereal traded in the world market. The global trade in wheat during 2008-09 was sharply up at around 140 million tonnes in 2008-09 from an average of around 110 - 115 million tonnes in the recent previous years.

While US (25 - 35 million tonnes), EU-27 (15-25 million tonnes), Canada (15-20 million tonnes), Australia (8-18 million tonnes) and Argentina (6 - 12 million tonnes) are major exporters; there are a large number of countries importing wheat with maximum demand emanating from developing nations. The major importing regions are Middle-east Asia, South-east Asia and North-west Africa. Egypt, Brazil, Indonesia, Algeria are the most important importing nations.

Wheat crops around the world have their own unique production cycles of planting and harvest timeframes.

Indian scenario:

India has the largest area in the world under wheat cultivation. However, due to low productivity it is only the third largest producer after EU-27 and China.

India's annual production of wheat has been around 75-79 million tonnes from 2006-07, with production in 2008-09 estimated to be around 78.6 million tonnes. Wheat accounts for around 30-35% of India's total food

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grain production of around 220 million tonnes. India's annual wheat consumption is estimated to be around 72 million tonnes currently.

Green revolution and increased focus by Government on wheat has helped wheat production to surge sharply from around 6 million tonnes at time of independence to current levels. Close to 90% of the area under wheat is irrigated, which too has supported the rise in output over the years.

Uttar Pradesh (34%), Punjab (20%), Haryana (13%), Rajasthan (10%) and Madhya Pradesh (10%) are the main wheat producing states of India.

Wheat is cultivated as a rabbi crop in India, with sowing being undertaken from October to December and harvesting from March to May. The official marketing season of wheat in India is assumed to commence from April.

Government plays a major role in the wheat value chain in India, as the cereal is very important for the country's food security. The Central Govt. sets the Minimum Support Price (MSP) every year, which sets the mood for the upcoming season. As govt. agencies have been recently procuring close to 25-30% of annual production, open market prices too do not generally fall below this price. Historically, the procurement has been around 15-20%.

Important world wheat markets:

Derivatives exchanges- Chicago mercantile exchange, which acquired Chicago board of trade, Kansas city board trade,zhenghzhou commodity exchanges, south African futures exchanges, mcx ncdex.

Us fob and eu (france) fob prices determine the physical prices

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.

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2010 543.10 515.63 494.56 491.75 491.00

2009 677.95 622.94 608.63 624.13 676.45 666.38 593.15 545.56 507.00 533.70 580.31 560.88

2008 833.75 899.20 981.25 911.50 862.60 957.13 931.31 915.10 825.81 660.95 632.88 617.00

2007 564.00 569.90 575.25 644.50 702.40 755.75

Energy:

Atf, crude oil, gasoline, electricity monthly & weekly, heating oil, important thermal coal, natural gas.

Crude oil:


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Crude oil is a mixture of hydrocarbons that exists in a liquid phase in natural underground reservoirs. Oil and gas account for about 60 per cent of the total world's primary energy consumption.

Almost all industries including agriculture are dependent on oil in one way are other. Oil & lubricants, transportation, petrochemicals, pesticides and insecticides, paints, perfumes, etc. are largely and directly affected by the oil prices.

The prices of crude are highly volatile. High oil prices lead to inflation that in turn increases input costs; reduces non-oil demand and lower investment in net oil importing countries.

Categories of crude oil:

West Texas intermediate (wti) crude oil is of very high quality. Its api gravity is 39.6 degrees (making it a “light” crude oil), and it contains only about 0.24 % of sulphur.

Wti is generally priced at about a $2-4 per barrel premium to opec basket price and about 4 1-2 per barrel premium to Brent, although on daily basis the pricing relationships between these can very gratly

Brent crude oil stands as a benchmark for Europe.

Global Scenario:

Oil accounts for 40 per cent of the world's total energy demand. The world consumes about 76 million bbl/day of oil.

United States (20 million bbl/d), followed by China (5.6 million bbl/d) and Japan (5.4 million bbl/d) are the top oil consuming countries.

Balance recoverable reserve was estimated at about 142.7 billion tones (in 2002), of which OPEC was 112 billion tones.

Indian scenario:

India ranks among the top 10 largest oil-consuming countries. Oil accounts for about 30 percent of Indians total energy consumption;

the countries total oil consumption is abot 2.2 million barrels per day.

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India imports about 70 per cent of its total oil consumption and it makes no exports.

India faces a large supply deficit, as domestic oil production is unlikely to keep pace with demand. India's rough production was only 0.8 million barrels per day.

The oil reserves of the country (about 5.4 billion barrels) are located primarily in Mumbai High, Upper Assam, Cambay, Krishna-Godavari and Cauvery basins.

Balance recoverable reserve was about 733 million tones (in 2003) of which offshore was 394 million tones and on shore was 339 million tones.

India had a total of 2.1 million barrels per day in refining capacity

Government has permitted foreign participation in oil exploration, an activity restricted earlier to state owned entities.

Indian government in 2002 officially ended the Administered Pricing Mechanism (APM). Now crude price is having a high correlation with the international market price. As on date, even the prices of crude bi-products are allowed to vary +/- 10% keeping in line with international crude price, subject to certain government laid down norms/ formulae.

Disinvestments/restructuring of public sector units and complete deregulation of Indian retail petroleum products sector is under way.

.

Exchanges in crude futures:

The New York mercantile exchange. The international petroleum exchange of London

The Tokyo commodity exchange.


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2010 82.53 79.18 82.70 89.53 83.17

2009 64.99 59.35 61.83 67.04 69.54 77.77 75.23 80.34 75.27 81.36 84.27 82.79

2008 86.56 91.18 97.56 103.34 121.68 135.64 137.12 119.92 109.56 88.29 76.70 65.22

2007 60.11 63.60 65.58 67.76 67.83 69.90 71.70 69.25 70.90 74.91 82.59 85.76

Gasoline:

Major Characteristics:

Gasoline (America) or MoGas or petrol (Commonwealth nations) is petroleum derived liquid mixture, primarily used as a fuel in internal combustion engines. It is primarily used as fuel for passenger cars. It is also used in off-highway utility vans, farm machinery and in other spark ignition engines employed in a variety of service applications.

Gasoline is a complex mixture of relatively volatile hydrocarbons, ranging from c4 to c11 that vary widely in chemical & physical properties and are derived from fractional distillation of crude petroleum in oil refineries with a further treatment mainly in terms of improvement of its octane rating. Small quantities of various additives are common, for purposes such as tuning engine performance or reducing harmful exhaust

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emissions. Some mixtures also contain significant quantities of ethanol as a partial alternative fuel.

Gasoline is derived from crude oil and its price shows high correlation with crude oil prices. The correlation in 2008 is estimated to have been around 93%.

Global scenario:

The world demand for gasoline is estimated to be an average 20 million barrels a day. The United States is the largest consumer with an average consumption of around 8.9 million barrels a day in 2008, accounting for over 40% of global consumption. This was over 9 million barrels a day in 2007.

Global gasoline production is reported to be above 6550 million barrels in 2007. Globally, gasoline production accounted for above 23% of the total production of refinery products in 2007.

US is the largest refiner of crude oil holding 20% of the total world refining capacity of 87,700 kilo barrels per calendar day, followed by China (8.9%), Former Soviet Union (8.8%), Japan (5.3%) and India (4.1%).

However, the production of gasoline in any country depends on the type of economy it follows. For eg, while US has adopted a gasoline based economy, India is largely a diesel based economy, leading to more production and consumption of gasoline in US and High-Speed Diesel (HSD) in India. Moreover, the light sweet crude oil used by US, yields more gasoline.

Indian scenario:

The growth of the Indian economy, rising incomes of the country's middle class has lead to rising numbers of passenger cars and consequently increasing demand for gasoline in India since the recent 10-15 years. India's consumption of gasoline in 2008-09 is estimated to be 82.5 million barrels in 2008-09, which is sharply up by 36% from 2004-05 consumption of 60.5 million barrels.

India's production of gasoline has shown a sharp improvement in the previous two decades, aided by the setting up of new refineries and increased capacity utilization. The production of gasoline has increased from 26 million barrels in 1990-91 to 117.4 million barrels in 2008-09, marking a 350% increase.

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Gasoline exports from India have grown substantially, with it jumping from 17.7 million barrels in 2005-06 to 39.1 million barrels in 2008-09, representing an increase of 120%, exposing the exporting Indian refineries to the huge volatility in global prices.

The majority of refineries in India are state-owned and follow a steady pricing policy as per Government regulations. The major refiners include Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL), Hindustan Petroleum Corporation Ltd (HPCL) and Reliance Industries Ltd (RIL). The RIL being a private player exports most of its production of petroleum products

World gasoline markets;

Chicago merchantile exchange, which was acquired new york merchantile exchange runs the most liquid gasoline market.Others are offering these products are tocom japan and mcx in india.


2010 202.44 199.51 224.73 232.79 212.80

2009 116.24 120.31 140.75 147.70 173.51 194.91 183.44 200.09 174.73 189.50 193.68 192.53

2008 236.32 243.61 267.65 290.18 323.92 348.78 333.44 294.21 268.01 172.41 119.98 94.81

2007 145.16 164.90 196.42 220.18 234.50 224.25 220.02 201.12 205.14 214.43 239.94 236.25

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Heating oil:

Major Characteristics:

Heating oil and Diesel are classified as distillate fuel oils and rank second behind gasoline as the most-consumed liquid fuels. While, diesel powers heavy construction equipment, trucks, buses, tractors, train and automobiles, heating is used in the central heating of homes and small buildings.

The main difference between the two fuels is that heating oil is allowed to contain more sulphur than diesel fuel. The US environment Protection Agency (EPA) stipulates that diesel used for transportation cannot have sulphur more than 500 ppm (parts per million). However, heating oil is not subject to such a mandate and it usually contains around 2000 - 2500 ppm of sulphur

It is estimated that in the US, approximately 12 gallons of distillate are produced from a 42-gallon barrel of crude oil. Of these 12 gallons of distillate, less than 2 gallons are heating oil, and the other 10 are diesel fuel.

Diesel fuel requires additional processing to remove sulphur and is therefore more costly to produce than heating oil. Diesel fuel is often priced at a stable premium to the price of heating oil as both are always produced together and are chemically similar.

As heating oil is derived from crude oil, its price shows a high correlation with crude oil prices. Crude – Heating Oil crack is the margin refiners earn when they refine crude oil into various products, especially heating oil, which varies between US $ 4 – 14 a barrel.

Global scenario:

World-over, residences and businesses are estimated to use about 10 billion gallons of heating oil each year. The US is the world's largest consumer of residential heating oil, with total consumption of residential heating oil in 2008 reported to be around 4.6 billion gallons. Of the 111 million households in the United States, approximately 8 million use heating oil as their main heating fuel.

Globally, more than three-fourths of the distillate sales, as diesel are for transportation and only a little more than 10% is used for residential heating.

US is the largest refiner of crude oil holding 20% of the total world refining capacity of 87,700 kilo barrels per calendar day, followed by

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China (8.9%), Former Soviet Union (8.8%), Japan (5.3%) and India (4.1%).

However, the production of heating oil or diesel in any country depends on the type of economy it follows. For eg, while US has adopted a gasoline based economy, India is largely a diesel based economy, leading to more production and consumption of gasoline in US and High-Speed Diesel (HSD) in India.

Indian scenario:

India only produces diesel, which is designated as High Speed Diesel (HSD).

The growth of the Indian economy has lead to increasing demand for energy for transportation and industry since the recent 10-15 years. As India is predominantly a diesel-based economy, the demand for diesel has been increasing at a quick pace.

India's consumption of High Speed Diesel in 2008-09 is estimated to be 15.9 billion gallons in 2008-09, which is up by 30% from 2004-05 consumption of 12.2 billion gallons.

India's production of High Speed Diesel has shown a sharp improvement in the previous two decades, aided by the setting up of new refineries and increased capacity utilization. The production of High Speed Diesel has increased from 5.3 billion gallons in 1990-91 to 19.4 billion gallons in 2008-09, marking a 265% increase.

High Speed Diesel exports from India have grown substantially, with it jumping from 2.6 billion gallons in 2005-06 to 4.2 billion gallons in 2008-09, representing an increase of above 60%, exposing the exporting Indian refineries to the huge volatility in global prices.

The majority of refineries in India are state-owned and follow a steady pricing policy as per Government regulations. The major refiners include Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL), Hindustan Petroleum Corporation Ltd (HPCL) and Reliance Industries Ltd (RIL). The RIL being a private player exports most of its production of petroleum products.

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World heating markets:

Chicago mercantile exchange, which has acquired New York mercantile exchange, and intercontinental exchange run heating oil derivative markets.


2010 204.19 197.21 208.45 223.97 207.01

2009 146.91 128.06 131.07 141.64 150.11 178.12 169.02 187.96 173.91 194.72 197.69 198.19

2008 256.15 265.05 304.39 319.62 361.66 387.23 384.93 319.94 295.37 219.15 179.59 138.92

2007 154.36 170.83 175.19 187.69 189.19 198.04 209.28 201.24 221.13 230.83 260.27 258.97

Imported thermal coal:

Characteristics:

Coal, a fossil fuel is a readily combustible black or brownish-black sedimentary rock normally occurring in rock strata in layers or veins called coal beds. It is composed primarily of carbon along with variable

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quantities of other elements, chiefly sulphur, hydrogen, oxygen and nitrogen. Coal is extracted from the ground by mining, either underground or in open pits.

The degree of change undergone by a coal as it matures from peat to anthracite is known as coalification. Coalification has an important bearing on coal's physical and chemical properties and is referred to as the 'rank' of the coal.

Low rank coals comprising of lignite or brown coal (17%) and sub-bituminous coal (30%) account for 47% of total global coal reserves. While lignite is largely used for power generation, sub-bituminous coal is used for electricity generation, cement manufacture and by industry.

Hard coal (53%) includes bituminous coal (52%) and anthracite (1%). Bituminous coal is further classified into thermal / steam coal and metallurgical / coking coal. Thermal coal is used for power generation, cement manufacture and has industrial applications. Coking coal is used largely for manufacture of iron and steel. Anthracite has both domestic and industrial uses.

Global scenario:

Coal reserves are available in almost every country worldwide, with recoverable reserves in around 70 countries. Global proven coal reserves are estimated to last for 122 years at current production levels, as against 42 and 60 years respectively for proven oil and gas reserves.

The total global proven reserves are estimated to be around 910 billion tonnes, with USA (27%), Russia (17%), China (13%), India (10%) and Australia (9%) holding major share of the reserves.

Global hard coal and brown coal (lignite) production is estimated at 5845 million tonnes (m.t.) and 951 million tonnes in 2008 respectively.

China (2761 m.t.), USA (1007 m.t.), India (490 m.t.), Australia (325 m.t.), Russia (247 m.t.) and Indonesia (246 m.t.) are the major global coal producers. The top three producers account for 73% of the total production.

Global hard coal consumption is estimated at 5814 m.t. in 2008. The economic progress of the world, especially in the emerging countries has lead to consumption sharply increasing by around 65% from levels of around 3500 m.t. in 1990's. China, alone accounts for 46% of the global hard coal consumption.

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Coal provides 26.5% of global primary energy needs and generates 41.5% of the world's electricity. The countries heavily dependent on coal for electricity generation include South Africa (94%), China (81%), Australia (76%), India (68%) and USA (49%).

Steel industry is estimated to use approximately 13% (around 717 m.t.) of total hard coal production and almost 70% of total global steel production is dependent on coal.

The global hard coal trade in 2008 is estimated to be around 938 m.t., with total trade in thermal coal estimated to be 676 m.t. The major global exporters of thermal coal in 2008 are Indonesia (173 m.t.), Australia (115 m.t.), Russia (86 m.t.) and Columbia (74 m.t.). The major global importers of thermal coal in 2008

Indian scenario:

Coal reserves are available in almost every country worldwide, with recoverable reserves in around 70 countries. Global proven coal reserves are estimated to last for 122 years at current production levels, as against 42 and 60 years respectively for proven oil and gas reserves.

The total global proven reserves are estimated to be around 910 billion tonnes, with USA (27%), Russia (17%), China (13%), India (10%) and Australia (9%) holding major share of the reserves.

Global hard coal and brown coal (lignite) production is estimated at 5845 million tonnes (m.t.) and 951 million tonnes in 2008 respectively.

China (2761 m.t.), USA (1007 m.t.), India (490 m.t.), Australia (325 m.t.), Russia (247 m.t.) and Indonesia (246 m.t.) are the major global coal producers. The top three producers account for 73% of the total production.

Global hard coal consumption is estimated at 5814 m.t. in 2008. The economic progress of the world, especially in the emerging countries has lead to consumption sharply increasing by around 65% from levels of around 3500 m.t. in 1990's. China, alone accounts for 46% of the global hard coal consumption.

Coal provides 26.5% of global primary energy needs and generates 41.5% of the world's electricity. The countries heavily dependent on coal for electricity generation include South Africa (94%), China (81%), Australia (76%), India (68%) and USA (49%).

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Steel industry is estimated to use approximately 13% (around 717 m.t.) of total hard coal production and almost 70% of total global steel production is dependent on coal.

The global hard coal trade in 2008 is estimated to be around 938 m.t., with total trade in thermal coal estimated to be 676 m.t. The major global exporters of thermal coal in 2008 are Indonesia (173 m.t.), Australia (115 m.t.), Russia (86 m.t.) and Columbia (74 m.t.). The major global importers of thermal coal in 2008.

World thermal coal markets are:

Intercontinental exchange which offers european and south African coal contracts run the most liquid coal derivative market.

Natural gas:

Characteristics:

Natural gas is a colourless, odourless, environment friendly energy source. It is a gas consisting primarily of methane. It is found associated with fossil fuels, in coal beds, as methane clathrates, and is created by methanogenic organisms in marshes, bogs, and landfills. Natural gas is commercially produced mostly from oil fields and natural gas fields.

Before natural gas can be used as a fuel, it must undergo extensive processing to remove almost all materials other than methane. The by-products of that processing include ethane, propane, butanes, pentanes and higher molecular weight hydrocarbons, elemental sulphurs, carbon dioxide, and sometimes helium and nitrogen.

The major difficulty in the use of natural gas is transportation and storage. While, pipelines are used for inland transport, it cannot be used under oceans, which is essential for global trade. Liquefied Natural Gas (LNG) is a proven commercial technology for transporting natural gas across oceans. However, as special ships and separate LNG receiving terminals are required, LNG projects are highly capital intensive in nature.

Global scenario:

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The world's proven natural gas reserves as on January 1, 2009 are estimated at 185.2 trillion cubic metre, of which almost three-quarters are located in the Middle East and Eurasia. Russia, Iran, and Qatar together account for about 57% of the total reserves.

Natural gas consumption has increased strongly over the past decade. However, despite this rising consumption, reserves-to-production ratios for most regions are substantial. Worldwide, the reserves-to-production ratio is estimated at 63 years.

The total global production of natural gas in 2008 is estimated to be 3065.6 billion cubic metre with the main producing countries being Russia Federation (602 billion cubic metre), US (582 bcm), Canada (175 bcm) and Iran (116 bcm).

The total global consumption of natural gas in 2008 is estimated to be 3018.7 billion cubic metre with the main consuming countries being US (657 bcm), Russia Federation (420 billion cubic metre), Iran (117 bcm), Canada (100 bcm) are the major consumers.

Globally, industries consume the largest portion of natural gas, followed by the power sector. Industrial consumption is expected to be around 40% of total global consumption by 2030 as projected by Energy Information Administration.

The total global trade in 2008 as piped natural gas and as LNG is reported to be 587.3 bcm and 226.5 bcm. While major exporters of piped natural gas are Russia (154 bcm), Canada (103 bcm) and Norway (93 bcm), the major importers are US (104 bcm), Germany (87 bcm) and Italy (75 bcm). The major exporters of CNG are Qatar (40 bcm), Malaysia (29 bcm), Indonesia (27 bcm) and the major importers are Japan (92 bcm), South Korea (36 bcm) and Spain (30 bcm)

Indian scenario:

Natural gas has gained prominence in India too as in the rest of the world over the last decade.

India has consumed around 41.4 bcm of natural gas in 2008 of which domestic production is 30.6 bcm and imports as lng has been 10.79

The share of imports is expected to increase in the coming years and cross 30%, from current level of around 25%.

Fertilizer (41%) and power (37%) are the major users of natural gas in India. The fertilizer sector in India is highly subsidized by the

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Government and it fixes the rate at which natural gas is provided to the fertilizer-manufacturing units.

World natural gas markets:

Chicago Mercantile Exchange (CME), which has acquired New York Mercantile Exchange (NYMEX), runs the world's most liquid natural gas derivative market.


2010 5.59 5.21 4.26 4.07 4.16

2009 5.04 4.36 3.93 3.61 3.86 3.93 3.60 3.19 3.36 4.82 4.65 5.29

2008 8.01 8.64 9.63 10.19 11.39 12.88 11.28 8.30 7.45 6.74 6.51 5.60

2007 6.71 7.64 7.25 7.66 7.86 7.47 6.42 6.18 6.18 7.08 7.86 7.19

Weather:

Carbon (cre), carbon (cfi)

Carbon (cer):

Carbon credits a market of 21st century:

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With growing concerns among nations to curb pollution levels while maintaining the growth in their economic activities, the emission trading (ET) industry has come to life. And, with the increasing ratification of Kyoto Protocol (KP) by countries and rising social accountability of polluting industries in the developed nations, the carbon emissions trading is likely to emerge as a multibillion-dollar market in global emissions trading. The recent surge in carbon credits trading activities in Europe is an indication of how the emissions trading industry is going to pan out in the years to come.

What is carbon credit?

One carbon credit is equivalent to one tonne of carbon dioxide or its equivalent greenhouse gas (GHG). Carbon credits are “Entitlement Certificates” issued by the United Nations Framework Convention on Climate Change (UNFCCC) to the implementers of the approved Clean Development Mechanism (CDM) projects. The potential buyers of carbon credits shall be corporates in various Annexure I countries that need to meet the compliance prevailing in their countries as per the Kyoto Protocol or those investors who would like buy the credits and with the expectation of selling them at a higher price during the KP phase (2008-12). The extension of KP shall be ratified by the current signatories of KP in their future meetings essentially to curb GHG emissions into the environment.

Sources of demand and supply:

Emerging carbon credit markets offer enormous opportunities for the upcoming manufacturing/public utility projects to employ a range of energy saving devices or any other mechanisms or technology to reduce GHG emissions and earn carbon credits to be sold at a price. The carbon credits can be either generated by project participants who acquire carbon credits through implementation of CDM in Non Annexure I countries or through Joint Implementation (JI) in Annexure I countries or supplied into the market by those who got surplus allowances with them. The buyers of carbon credits are principally from Annexure I countries. They are:

Especially European nations, as currently European Union Emission Trading Scheme (EU ETS) is the most active market;

Other markets include Japan, Canada, New Zealand, etc.

The major sources of supply are Non-Annexure I countries such as India, China, and Brazil.

Risk associated with carbon credits:

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There are market- and policy-related risks for CER producers, including the supply-side risks starting from the DNA approval risk to the CER issuance risk in a complete CDM approval cycle. Apart from these risks there are a host of other risks from both the supply and demand sides that the real market players confront with.

Most CDM projects by their very nature take a long time to generate the CERs and hence, face the aforesaid risks in large proportion, which if not hedged would lead to reduced realization. Under such a situation, the realization of CER generators at times may not even cover the investment put in to generate the CERs and thus, has the potential of even making a CDM project unviable in the long term. Given the long gestation period of CDM projects and the risks involved, it is rather inevitable that they pre-sell their potential credits in the futures market (preferably a domestic futures market, to avoid forex risk attached to participation in a foreign exchange) and thereby, cover their probable downside in the physical market.

India as a potential supplier:

India, being one of the leading generators of CERs through CDM, has a large scope in emissions trading. Analysts forecast that its trading in carbon credits would touch US$ 100 billion by 2010. Currently, the total registered CDM projects are more than 300, almost 1/3rd of the total CDM projects registered with the UNFCCC. The total issued CERs with India as a host country till now stand at 34,101,315 (around 34 million), again around 1/3rd of the total CERs issued by the UNFCCC. In value terms (INR), it could be running into thousands of crores.

Further, there has been a surge in number of registered projects in India. In 2007, a total of 160 new projects were registered with the UNFCCC indicating that more than half of all registered projects in India happened last year. It is expected that with increasing awareness this would go further up in the future. The number of expected annual CERs in India is hovering around 28 million and considering that each of these CERs is sold for around 15 euros, on an average, the expected value is going to be around Rs 2,500 crore.

The role of MCX:

The mcx keen to play a major role on the emission front by extending its platform to add carbon credits to its existing basket of commodities with regard

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to commodities futures trading, the existing and potential suppliers of carbon creditis in India have geared up to generate more carbon credits from their existing and ongoing projects to be sold in the international markets.

Oil and oil seeds:

Crude palm oil, kapasia khalli, refined Soya oil, Soya bean.

Crude palm oil:

Palm oil is obtained from fresh fruit bunches of oil palm cultivated in plantations. There are several commercial variants of palm oil available viz crude palmoil, cride palmolein,rbd(refined bleached deoderised)palmoil,rbd palmolein and palm kernel oil.

Global scenario:

Palmoil with an annual production of 25-27 million tonnes is second most produced oil in the world.

Malaysia (13 million tons) and Indonesia (10 million tons) are the major producers. They together account for 85% of production.

Around 80% (21-23 million tons) of global production is exported. Malaysia and Indonesia with 12-12.5 and 6-7 million tons respectively are major exporters

India china and eu are the major importers.

Price competitiveness has been reason for increased consumption of this oil.

Indian scenario:

India imports roughly 2.5-3.5 million tons of palmoil and its variants a year. The domestic production is very meager at 0.5 lakh tons.

India imposes 65% duty on crude oil and 75% (imposed in 2003-04 Union Budget) on RBD Palmoil. The import ratio is highly dependent on the duty imposed.

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In addition to the customs duty, Government of India also imposes tariff value, on which the customs duty is calculated irrespective of the actual price at which the oil is imported.

In 2002-03 India imported 21.5 lakh tons of crude palmoil and 3.15 lakh tons of RBD Palmoil. However, in 2003-04 till July from November '03 India has imported 13.7 lakh tons of crude palmoil and 4.8 lakh tons of RBD Palmoil.

Kandla, Mumbai, Kakinada are the major ports for palmoil entry to India and the major trading points too.

World palm oil markets:

Bursa Malaysian derivatives is the largest market for palmoil Malaysian and Indonesian fob prices.

Overview:

Crude oil for June delivery was down $1.45 at $70.15 a barrel, after settling down $2.79 at $71.61 on may 14th , stretching a two-week tumble to $14.54, or 16.9%, the biggest two-week percentage loss since the period ending January 16, 2009. The contract, which fell to $70.83 on Friday, the lowest since February 8, is expected to face volatility ahead of Monday's June crude options expiration and the May 20 June crude contract expiration.

Stockpiles of crude at Cushing, Oklahoma, the delivery hub for the US contract's West Texas Intermediate benchmark crude, have risen in the last eight weeks to a record 37 million barrels, pushing front month US crude down relative to both more distant futures contracts and the alternative global crude benchmark, Brent.

Kapasia khalli(cottenseed oil cake):

Characterstics:

Kapaskhalli (cottonseed extraction/meal) is a by product of the cottonseed industry.

Cottonseed is a by-product of the cotton plant, which is primarily grown for its fibre. Although cotton has been grown for its fiber for several thousand years, the use of cottonseed on a commercial scale is of relatively recent origin.

Cottonseed was a raw agricultural product, which was once largely wasted. Now it is being converted into food for people; feed for livestock; fertilizer

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and mulch for plants; fiber for furniture padding; and cellulose for a wide range of products from explosives to computer chip boards.

Global scenario:

Annually around 15 - 16.5 million tons of cottonseed meal is produced globally. Globally, the oil content of cottonseed is 18%, and the remaining portion is the cottonseed meal.

Most of the production of cottonseed meal is consumed in the country of production itself, limiting the global trade to just 5-6 lakh tons a year.

China (1-1.2 lakh tons) is the single largest exporter, while Europe (2 lakh tons), South Korea (1-1.5 lakh tons) are the largest importers of cottonseed meal.

Cottonseed is the second most commonly produced oilseed in the world just slightly ahead of soy. However, in 2003-04 rapeseed/mustard has marginally overtaken this seed.

The global production of cottonseed is around 35 million tons in the recent years. The major producers of cotton are also the major producers of cottonseed. China, USA, India, Pakistan, Uzbekistan and Brazil are the major producers globally.

Indian scenario:

Cottonseed is a traditional oilseed of India. It is estimated that cottonseed production will be around 33% of the cotton production in bales. Around 80% of the seed is marketable surplus and arrives in the market for being crushed to oil. The remaining is used as seed is fed to cattle.

India's cotton output and along with it the cottonseed, meal and oil output varies considerably from year to year in response to the vagaries of weather and pest attacks.

India's cottonseed production in 2002-03 and 2003-04 is estimated at 36.3 and 43.4 lakh tons respectively.

India produces around 2 million tons of cottonseed meal a year.

The protein content of the scientifically produced meal is 40-42% against 20-22% in the traditionally processed meal. The cattlefeed manufacturers prefer this meal as it contains lesser amount of gossypol, which if consumed in larger amounts is a poison for cattle.

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However, in India mainly undecorticated meal is largely produced. Several associations are promoting the production of decorticated cake in India and the production of this is expected to increase in the country.

India used to be a major exporter of cottonseed extraction around two decades ago. However, the demand for other oil meals like soymeal, has lowered the cottonseed demand globally. In addition, the low availability of decorticated meal in India has also been a major reason for the fall in exports.

The major importers of Indian cottonseed meal (undecorticated) used to be Thailand. India in 2002-03 exported only 50 tons of decorticated cottonseed meal. In 2003-04, too there have been no significant exports. India does not import cottonseed meal.

Major trading centres:

Akola, Parbhani, Nagpur, Yeotmal are the major trading centers where cottonseed from the cotton procured by the Maharashtra State Cooperative Cotton Growers Marketing Federation is auctioned off.

Refined Soya oil:

Characteristics:

Soybeans on crushing and solvent extraction yield soyoil at 18% recovery and soymeal. About 85% is crushed worldwide.

Soybean and soyoil production of 170-185 and 25-31 million tons account for 55-58% and 25-30% of global oilseed and oil production respectively.

US, Brazil, Argentina, China, India are the major producers in order of production. In US, India, China crop starts arriving from Aug-Sept, while it starts from Jan-Feb in S. America.

In the world 55-60, 8-10 and 42-45 million tons of beans, oil and meal are traded annually.

USA (20-30 million tons), Brazil (12-18 million tons), Argentina (5-10 million tons) are the exporters of beans, while China (18-20 million tons) and EU (15-18 million tons) are the major importers.

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Argentina (3-5 million tons) and Brazil (2-3 million tons) are the major exporters of oil. China (1.5-2.5 million tons) and India (1-2 million tons) are the major importers of oil.

Crushers, refined oil manufacturers, animal feed manufacturers and farmers are the major stakeholders in the soy value chain worldwide.

Indian scenario:

India produces 5-7 million tons of beans, 1 million ton of oil and 3-5 million tons of soymeal in a normal year. With imports, the total oil availability in the country is around 2.5 million tons

Madhya Pradesh (3.5-4.5 million tons), Maharashtra, Rajasthan are the major producers of soybean in India.

The production is highly dependent on the monsoon and fluctuates between years

The Soy is a Kharif crop, sown in June-July and harvested by September-October. Peak arrivals are from October-November.

The prices follow the international sentiments and display very high.

Major trading centers:

Indore, Ujjain, dewas, mandsore in madhyapradesh, Nagpur in Maharashtra, Kota in rajesthan are major trading centers.

Soya bean:

Characteristics:

Soybean is an important global crop and processed soybean is the largest source of protein feed and second largest source of vegetable oil in the world.

The major portion of the global and domestic crop is solvent-extracted with hexane to yield soy oil and obtain soymeal, which is widely used in the animal feed industry. It is estimated that above 85% of the output is crushed worldwide.

Though, a very small proportion of the crop is consumed directly by humans, soybean products appear in a large variety of processed foods.

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The cultivation of soybean is successful in climates with hot summers, with temperatures between 20°C to 30°C being optimum. Temperatures below 20°C and over 40°C are found to retard growth significantly.

It can grow in a wide range of soils, with optimum growth in moist alluvial soils with a good organic content.

Modern soybean varieties generally reach a height of around 1 m (3 ft), and take 80-120 days from sowing to harvesting.

Global Scenario:

The annual global soybean production has been in the range of 210-230 million tonnes in the recent years, accounting for 55-58% of total global oilseed output of around 390-400 million tonnes.

US, Brazil, Argentina, China and India are the major producers in order of production with production in these countries ranging around 70-80, 55-60, 32-48, 14-16 and 8-10 million tonnes in the recent couple of years.

Weather, acreage under other competitive crops like corn, cotton and pests & diseases are the major factors influencing production.

While in US, India and China crop starts arriving from Aug-Sept, it starts from Jan-Feb in S. America.

The annual global trade in soybean is estimated to be around 70-80 million tonnes.

While, USA (30 -35 million tonnes), Brazil (23-28 million tonnes), Argentina (5-15 million tonnes) are the exporters of beans, China (35-40 million tonnes) and EU (12-16 million tonnes) are the major importers.

In addition to soybean, soy oil and soymeal are also widely traded globally with annual trade of around 9 million tonnes and 52 million tonnes respectively. While, US is the largest exporters for soybeans, Argentina is the largest exporter of soy oil and soy meal globally.

Indian Scenario:

India's annual production of soybean has been around 8.5-10 million tonnes in the recent years with India's production in 2009-10 estimated to be around 8.9 million tonnes by the Government of India.

The acreage under this crop has more than doubled in the past two decades to around 11 million hectares currently being sown under this crop, with better returns encouraging more farmers to adopt this new crop.

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Madhya Pradesh, Maharashtra, Rajasthan and Andhra Pradesh are the major cultivators of this important oilseed, with their respective contributions usually around 60%, 25%, 6-7% and 1-2%.

Soybean is exclusively grown in the khariff season in India, with sowing taking place after the first monsoon showers in late June or early July. Sowing can extend upto end of July in different parts of the country.

The harvesting commences from September, with Maharashtra reporting the earliest arrivals. October and November are the peak arrival months, with all-India arrivals crossing 10 lakh bags of approximately 90 kg on the peak arrival days.

The production is dependent on the monsoon and fluctuates between years.

India is highly dependent on imports to meet domestic edible oil requirement. Government policies are in favour of developing the domestic crushing industry and supporting Indian farmers anddo not promote import or export of soybean. Thus, there is virtually no import or export of soybeans.

However, India out of its total soymeal production of around 6.5-7 million tonnes, exports around 3.5 million tonnes with Vietnam, Japan, Thailand, Indonesia, UAE, Greece being the major importers.

Major Trading Centres:

Indore, Ujjain, Dewas, Mandsore in Madhya Pradesh, Akola, Sangli, Nagpur in Maharashtra, Kota in Rajasthan are major trading centres.

Overview:

Edible oil imports in April 2010 fell by 22 percent due to huge stockpiles in the domestic market. Imports during April 2010 reported at 5.43 lakh tonnes against 6.99 lakh tonnes in same month of last year. Edible oils imports during first six months of edible oil year beginning from November is reported at 42.9 lakh tonnes almost same as that of last year.

Total stock available in the market is estimated at 12.25 lakh tonnes of which 5.75-lakh tonnes lying in the ports. Global edible oil markets continue to fall on

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economic crisis in Europe and strong US Dollar. Soybean futures at CBOT six weeks low of 937 cents and currently trading steady at 943 cents. It may not be increased more in this year.

Historic data of oil and oilseeds:

Mixed trends were noticed in the Delhi oil and oilseeds market past week. Mustard oil expeller closely followed the trends prevailing in Rajasthan and UP producing centres. According to market men, this year mustard seed production in Rajasthan is estimated to be lower by around 5-6 lakh tonne. Obviously, with the advancing days arrivals of mustard seed in Alwar, Bharatpur, Niwai, Tonk, Jaipur and Kota have thinned down. On the other hand, mustard seed production in UP is reported to be good and this led to increase in arrivals at Kanpur and Jhansi a fortnight ago. With the oil-millers in Agra finding it more profitable to buy UP mustard seed this has slightly firmed prices. Consequently, mustard oil in Delhi after drifting in a range of Rs 20-30 per quintal through out the weak, closed firm by Rs 30 at Rs 4600 per quintal end week. In contrast, soya and cottonseed oil fell Rs 20/30 per quintal following weak advices from KLCE and Chicago soya oil complex. CPO (crude palm oil) in Kandla was also traded down from Rs 3670 to Rs 3660 per quintal on selling pressure. Edible oil end week improved as CPO firmed in Kandla Vanaspati ghee (hydrogenenated fat) surged to a high of Rs 670/845 per tin gaining Rs 10/15 on heavy demand from UP, West Bengal and Bihar. Vanaspati ghee in Kanpur was also traded up by Rs 25/30 per tin. In view of the marriage season demand ahead, prices are expected to move further up by Rs 20/30 per tin, marketmen said. Edible oil is expected to tread the same line, they added. The DOC (deoiled cake) section remained depressive past week. While soya DOC was down Rs 200 at Rs 17800 per tonne on weak advices from Kota where prices slumped by Rs 400 to Rs 16000 per tonne on lack of export demand, groundnut DOC tumbled by Rs 500 to Rs 16000/17000 per tonne. Mustard DOC too lost Rs 200 per tonne on lack of buying support.

Plantations:

Rubber:

Characteristics:

Natural Rubber (NR) is produced from latex or field coagulam obtained from rubber trees planted in plantations. The most important forms in which NR is

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processed and marketed are the following: Sheets, Crepes, Block rubber and Preserved Latex Concentrates. In India sheet rubber designated as RSS 1, RSS 2, RSS 3, RSS 4, RSS 5 are the most commonly produced and marketed. Block Rubber is designated in the grades of ISNR.

Global Scenario:

Thailand, Indonesia, India, China, Malaysia, Vietnam are the major producers of rubber in the World.

The global production fluctuates between 6-8 million tons, with a production of 7.9 million tons in 2003, of which Asian countries have produced 6.76 million tons.

On the consumption front, global NR consumption is 7.89 million tons in 2003, of which 1.9 million ton was consumed in India and China alone. The total synthetic rubber consumption in 2003 was 1.13 million ton.

Around 60 % of the global rubber production is used by the transportation sector. In this sector, natural or synthetic rubber cannot be used individually and has to be blended.

Indian. Scenario:

India's rubber production in India is around 6-7 lakh tons. Kerala accounts for 90% of India's rubber production. The other producer

is Karnataka.

RSS (Ribbed Smoked Sheets) account for 72% of the production and 45% of the imports. Block Rubber accounts for 10% of the production and 40% of the imports.

The tyre industry, consumes 52 % of the almost 7 lakh rubber produced in the country.

Tyre is the major form in which rubber is exported from India. India's tyre exports are around Rs. 1200-1300 crores a year. Duty-free imports against the advance licence scheme is permitted for re-export and rules mandate that only 44 kg of natural rubber can be imported against 100 kg of exports. India's imports vary between years and is currently around 50000-60000 tons a year. Duty-paid i mports of natural rubber under open general license attract 20 % import duty.

Major Indian Markets:

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Kottayam, Kochi, Kozhikode and Kannur in Kerala are the major primary markets.

Fiber:

Characteristics:

Kapas is unginned cotton or the white fibrous substance covering the seed that is obtained from the cotton plant.

Global scenario:

The world cotton area and production are estimated at around 30-31 million hectares and 20 million tons respectively.

The biggest cultivators of cotton are America, India, China, Egypt, Pakistan, Sudan and Eastern Europe, with China, US and India being the three largest producers of cotton.

US have a considerable share in world exports. India and China both fall short of their domestic requirement and are net importers.

Among the consumers China leads the way being followed by India, Pakistan, US and Turkey.

Indian scenario:

India with an annual production of 15-16.5 million bales (1 bale=170 kg) is the World's third largest cotton producer. India also has the largest area under cotton. India produces around 11% of the world's cotton from 20% of the area.

The Ministry of Agriculture estimates India's cotton production in 2003-04 at 123.9 lakh bales. However, other agencies peg the production at 140-160 lakh bales.

Despite having the largest area under cotton in the world, India ranks third in world output of cotton due to its abysmally low average yield of 300 kg against a world average of 550 kg per hectare.

Although cotton is cultivated in almost all the states in the country, the 9 states of Maharashtra, Gujarat, Andhra Pradesh, Madhya Pradesh, Punjab, Haryana, Rajasthan, Tamil Nadu and Karnataka account for more than 95% of the area under and output.

In India cotton is sown during March to September and harvested during September to April. The peak marketing season for the crop is during November to March.

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Cotton is the most important raw material for India's Rs. 1,50,000 crores textile industry, which accounts for nearly 20% of the total national industrial production and provides employment to over 15 million people.

It also accounts for more than 30% of exports, making it India's largest net foreign exchange industry. India earns foreign exchange to the tune of $10-12 billion annually from exports of cotton yarn, thread, fabrics, apparel and made-ups.

Cotton accounts for more than 75% of the total fibre that is converted into yar by the spinning mills in India and 58% of the total textile fabric materials produced in the country.

Spices:

Cardamom, coriander, turmeric

Cardamom:

General Characterstics:

Cardamom is the 'Queen of Spices' as it is one of the most exotic and highly prized spices. Cardamom plants normally start bearing two years after planting. There are three distinctive types of cardamom grown in India viz., Malabar, My sore and Ceylon type. The two major commercial varieties of small cardamom in the world are the Malabar and the Guatemalan. Indian cardamom is slightly smaller, but more aromatic.

Indian Scenario:

Production has decreased marginally from 11920 MT in 2002-03 to 11415 MT in 2004-05

Kerala (70%), Karnataka (20%) and Tamil Nadu (10%) are the cardamom growing states in India.

About 90% of the produce is consumed within the nation.

India roughly exports 5% - 8% of its total production. Saudi Arabia accounts for 42% and Japan 39% of India's exports (2004-05).

Export of value-added product from cardamom like cardamom oil and cardamom oleoresins are increasing to Germany, Netherlands and UK

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Global Demand-Supply Scenario

Guatemala, India, Tanzania, Sri Lanka, El Salvador, Vietnam, Laos, Cambodia and Papua New Guinea are the major cardamom growing countries.

World production of cardamom is estimated at 30000 -35000 MT.

Guatemala produces nearly two-third of the total global cardamom production. Its production has increased significantly from 13500 MT in 2002 to 23000

Saudi Arabia is single largest importer of cardamom, distantly followed by Kuwait.

Factors Influencing Cardamom Markets

Fresh cardamom is green and has a characteristic aroma. Freshness, colour, aroma and size are the major factors that influence cardamom prices, in addition to the current supply-demand scenario.

Cardamom is usually stored in cooler areas to preserve its inherent properties.

Indian cardamom specially Alleppey Green is a premium grade against all other international grades. However, the production and export from Guatemala has profound influence on Indian cardamom prices.

Weather and annual production of a year.

Production in other countries particularly Guatemala.

Year ending stocks and stocks-to-consumption ratio.

Time of arrival of new crop in the market.

Major Indian markets:

Cardamom is sold at auction centres. Important markets for cardamom in the country are Vandanmendu, Bodinayakanur, Kumily, Thekkady, Kumbum and Pattiveeran Patti in Kerala.

Coriander:

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General Characteristics:

Coriander (Coriandrum sativum), dhania is an annual spice crop and a member of the Umbelliferae, or carrot family. The coriander plant yields both the fresh herb and spice seed, which are used primarily for culinary purposes.

The fresh green herb is called cilantro, or Chinese parsley. It is used in southeast and southern Asian, Chinese and Mexican cuisine, and for flavouring salads and soups.

The fruits (seeds) are widely used as condiments with or without roasting in the preparation of curry powders, sausages and seasonings. It is an important ingredient in the manufacture of food flavourings, in bakery products, meat products, soda & syrups, puddings, candy preserves and liquors.

The spice is also employed for the preparation of either the steam-distilled essential oil or the solvent-extracted oleoresin. Both products are used in the flavouring and aroma industries.

Global Scenario:

The global production of coriander seed is estimated to be around 6 lakh tonnes. However, official estimates are rarely available for this crop in most producing countries. Additionally, coriander is widely grown in home gardens on a small scale, which is never included in official statistics.

The major global producers are India, Morocco, Canada, Romania, Russia and Ukraine. The other producers are Iran, Turkey, Israel, Egypt, China, US, Argentina and Mexico.

The global trade in coriander is estimated to be around 0.85 - 1 lakh tonnes a year. While, India, Turkey, Egypt, Romania, Morocco, Iran and China are the major exporters. Middle East, South-east Asia, USA, UK, Germany etc are the major importers.

Indian Scenario:

India is the biggest producer, consumer and exporter of coriander in the world with an annual production averaging around 3 lakh tonnes. The production fluctuates widely between years and has varied from below 2 lakh tonnes to above 4 lakh tonnes in this decade.

Rajasthan (54%) and Madhya Pradesh (17%) are the two largest producing states in the country contributing over two-thirds to the country's total production in 2006-07. The other producers are Gujarat (6.9%), Assam

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(6.6%), Andhra Pradesh (3.5%, Karnataka (3.3%), Orissa (3.2%) and Tamil Nadu (2%).

Official estimates of area and production are released by the Spices Board, India and the latest estimates available peg India's production in 2006-07 at 2.88 lakh tonnes and area under cultivation at 3.62 lakh hectares. The production from Rajasthan and Madhya Pradesh are reported at 1.55 and 0.50 lakh tonnes respectively. Rajasthan's coriander production is estimated to have dipped sharply to around 1.30 lakh tonnes in 2007-08. However, output is 2008-09 is reported to be normal.

Coriander for seed cultivation is grown as a rabi crop with sowing undertaken during October - November and new crop arrivals seen in February - March.

India annually exports around 25,000 - 30,000 tonnes of coriander a year. India exported 30,200 tonnes of coriander in 2008 valued at Rs 204 crores in 2008. The major buyers were Malaysia (7050 tonnes), UAE (5450 tonnes), Pakistan (3215 tonnes) and Saudi Arabia (2475 tonnes).

The major domestic buyers of coriander seed in India are spice-processing agencies, which consume around 50% of the production are mostly located in the southern states of India and Delhi. The demand from this sector peaks during April to June, which also coincides with the peak arrival period.

Major Indian Trading Centres:

The major markets are located in Rajasthan and Madhya Pradesh. The three largest markets are Kota, Ramganj Mandi and Baran in Rajasthan.

Others:

Almond, guar seed, meltedmentholflakes, mentha oil, potato.

Almond:

General Characteristics:

Almonds, though considered to be nuts are technically the seed of the fruit of the almond tree, which is a medium-sized tree that bears fragrant pink and white flowers. The fruit, botanically referred to as a drupe has an outer hull and a hard shell with the seed inside.

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Almonds are commonly sold shelled. Shelling almonds refers to removing the shell to reveal the seed. Almonds with their shells attached are called unshelled almonds. Blanched almonds are shelled almonds that have been treated with hot water to soften the seed coat, which is then removed to reveal the white embryo.

Sweet almonds and Bitter almonds are two forms of almonds, of which sweet almond is the variety, which is consumed directly or indirectly by humans as a food product. Bitter almond is slightly shorter and broader than sweet almonds and are mainly used for extracting almond oil and not consumed as food, as it is poisonous.

Chocolate confectionary, bakery and snacking are the three major global categories for almond usage.

Global scenario:

The annual global Sweet almond production on shelled-basis has been in the range of 7 - 8.5 lakh tonnes in the recent years. Record crops and a steady increase in production were seen from 2005-06 to 2008-09 (Almond crop year is from August to July). However, the output in 2009-10 is forecasted to dip on account of unfavourable climatic conditions.

United States of America is the single largest producer, consumer and exporter of Sweet almonds, with the country contributing to over 80% of the global almond production.

The state of California in US is the most important producer of Sweet almonds, as this region is reported to be accounting for 99% of the American production.

Nonpareil is the single largest variety planted in California. Its production is reported to be 38% of the total output, followed by Carmel (12%), Monterey (10%), Butte/Padre (9%) and Butte (8%).

The world's largest almond handler is the Blue Diamond Growers Cooperative, which is located in Sacramento, California. Blue Diamond is owned by over two-thirds of California growers and markets one-third of California's crop.

The other producing countries are Australia, Turkey, Chile, European Union, China and India with a production of 26,000 tonnes, 16,000, 9500, 79,800, 1,500 and 1,200 tonnes on a shelled basis in 2008-09. Spain is the single largest producer in the European Union.

The annual trade in almonds has been around 4.6 lakh tonnes (on shelled basis) in the recent years. The major exporters are US, Australia and Chile

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with exports of 4,40,000 tonnes, 12,300 tonnes and 6,700 tonnes (on shelled basis) in 2008-09. European Union, India, Japan, Canada and Turkey are the major importers with imports of 2,00,000 tonnes, 45,000 tonnes, 21,000 tonnes, 19,000 tonnes and 14,000 tonnes in 2008-09.

While, the peak harvesting period of the Californian crop starts from mid-August and extends till September that of Australian crop occurs between February and April.

Indian scenario:

The ever-expanding middle class and increase in health awareness, has lead the growing consumption of almond in the country in recent years. The annual rate of increase in India's domestic consumption of almonds is reported to be around 20%.

More than 95% of almonds consumed by Indians is imported with more than 80% of imports being sourced from California. The other major country from which India imports almonds is Australia. While, Indian imports in 2008-09 is reported to be above 45,000 tonnes, the imports in 2009-10 are expected to rise to 50,000 tonnes.

India has to resort to imports to meet almost its entire requirements as domestic production of sweet almonds is only around 1,200 tonnes. The other almond trees present in the country are of non-descript variety and mostly produce bitter almonds.

India imports almonds with shells and processes it domestically to obtain shelled almonds, unlike almost all other importing nations, which import shelled almonds. This is due to availability of cheap labour and better appearance and lesser losses in manual shelling of almonds as against mechanized shelling.

Most of the manual shelling of almonds in India is undertaken at Bombay and New Delhi, from where the shelled almonds are transported to other consumption centres.

The Indian festival season extending from September to December is the peak consumption period for almonds, with maximum demand witnessed in November. Thus heavy imports of new Californian almonds are seen from September to meet the strong domestic demand during the festival season. Imports from Australia pick up during April and May after the harvesting season in that country.

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Major Indian trading centers:

Mumbai and New Delhi.

Guar seed:

Characteristics:

Guar, or clusterbean, (Cyamopsis tetragonoloba (L.) Taub), is the source of a natural hydrocolloid, which is cold water soluble forming thick solutions at low concentrations.

The guar seed consists of three parts: the germ, the endosperm, and the husk. It is from the endosperm that guar gum is derived. 100 Kilos of beans, minus their bean pods yields roughly 29 kilos of endosperm; 29 kilos of Guar powder.

Industrially it is used in mining, petroleum drilling and textile manufacturing.

In food it is used as a thickener and as a mean of preventing ice crystal formation in frozen desserts.

Supply Scenario:

India is the major producer of Guar Seed followed by Pakistan and US. India's guarseed production fluctuates between years and has been around 2-6 lakh tons in the recent years. India's guar production in 2003, is estimated at around 6 lakh tons.

India accounts for 80% of the total guar produced in the world. 70% of India's production comes from Rajasthan. The other producers are Gujarat, Haryana, Punjab, Uttar Pradesh and Madhya Pradesh.

Taking the US, Australian, African crop the total world supply of Guar Split is around 4-5 lakh tons in a normal year. It may even increase to 8 lakh tons as has been visible in 2003-04.

Guar is a crop of semi arid - sub tropical areas spread over the north and north west of India and east and south east of Pakistan. It is grown in arid

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zones of Rajasthan, some parts of Gujarat, Haryana, and Madhya Pradesh. The main guar-growing region in India is Rajasthan.

Guar is a rain fed monsoon crop, which requires 8-15 inch of rain in 3-4 spells and is harvested in October - November. It is sown immediately after first showers say in July and harvested around November each year. The crop yield is directly related to the monsoon. It requires a relative long growing season of 20-25 weeks.

Demand scenario:

World market for guar gum is estimated to be around 150,000 tons/year, 70% of which is produced by India and Pakistan.

US consumption is estimated to be around 40,000 tons/year.

The export from India is around 115,000 tons and the domestic market is of around 25,000 tons.

India exported 33000 tons of guar gum refined split and 84000 tons of guar gum treated and pulverized in 2002-03, which together accounts for an export of 117000 tons of guargum exports valued above Rs. 300 crores.

The main demand of guar seed originates from the US petroleum industry and also the oil fields of Middle East.

Major Guar Seed producing States & Trading Centers

Guar seed is grown in the northwestern parts of country encompassing states of Rajasthan (Churu, Nagaur, Banner, Sikar, Jodhpur, Ganganagar, Sirohi, Dausa, Bikaner, Hanumangarh and Jhunjhunu), Gujarat (Kutch, Banaskantha, parts of Mehsana, Sabarkantha, Vadodara and Ahmedabad), Harayana (Bhiwani, Gurgaon, Mahendragrh and Rewari) and Punjab (Bhatinda, Ferozpur, Muktsar and Mansa).

Rajasthan is the largest growing state of Guar seed in the country accounting for 70% of total production. The other producers are Gujarat, Haryana, Punjab, Uttar Pradesh and Madhya Pradesh.

Table 1: Guar Seed Major Producing States & their Trading Centers

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State Major Trading Centers

Rajasthan

Hanumangarh, Sriganganagar, Bikaner, Jodhpur, Sikar, Jaipur, Jaisalmer, Barmer and Nagaur

Gujarat Kutch, Banaskanta, Sabarkanta, Mehsana and Patan

Haryana Adampur, Ellenabad, Fatehbad, Hisar, Sirsa and Bhiwani

Punjab Bhatinda

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Production pattern, which is linked to monsoon rainfall

Weather conditions and rainfall pattern

Stocks in the hands of traders or producers

Demand from overseas market for Guar & its derivatives products

Important comodities:

The some of the major comodities are gold, silver, crudeoil, soyabeans, copper, and wheat.

Crude oil:

History and analysis of crude oil:

Introduction:

Crude oil prices behave much as any other commodity with wide price swings in times of shortage or oversupply. The crude oil price cycle may extend over several years responding to changes in demand as well as OPEC and non-OPEC supply.

The U.S. petroleum industry's price was heavily regulated through production or price controls throughout much of the twentieth century. In the post World War II era U.S. oil prices at the wellhead averaged $26.64 per barrel adjusted for inflation to 2008 dollars. In the absence of price controls, the U.S. price would have tracked the world price averaging $28.68. Over the same post war period the median for the domestic and the adjusted world price of crude oil was $19.60 in 2008 prices. That means that only fifty percent of the time from 1947 to 2008 have oil prices exceeded $19.60 per barrel.

Until the March 28, 2000 adoption of the $22-$28 price band for the OPEC basket of crude, oil prices only exceeded $24.00 per barrel in response to war or conflict in the Middle East. With limited spare production capacity, OPEC abandoned its price band in 2005 and was powerless to stem the surge in oil prices, which was reminiscent of the late 1970s.

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Crude Oil prices ranged between $2.50 and $3.00 from 1948 through the end of the 1960s. The price oil rose from $2.50 in 1948 to about $3.00 in 1957. When viewed in 2008 dollars an entirely different story emerges with crude oil prices fluctuating between $17 and $19 during most of the period. The apparent 20% price increase in nominal prices just kept up with inflation.

From 1958 to 1970, prices were stable near $3.00 per barrel, but in real terms the price of crude oil declined from above $19 to $14 per barrel. The decline in the price of crude when adjusted for inflation for the international producer suffered the additional effect in 1971 and 1972 of a weaker US dollar.

Established in 1960 OPEC, with five founding members Iran, Iraq, Kuwait, Saudi Arabia and Venezuela, took over a decade to establish its influence in the world market. Two of the representatives at the initial meetings had studied the Texas Railroad Commission's methods of influencing price through limitations on production. By the end of 1971, six other nations had joined the group: Qatar, Indonesia, Libya, United Arab Emirates, Algeria and Nigeria. From the foundation of the Organization of Petroleum Exporting Countries through 1972 member countries experienced steady decline in the purchasing power of a barrel of oil.

In 1972, the price of crude oil was about $3.00 per barrel. By the end of 1974, the price of oil had quadrupled to over $12.00. The Yom Kippur War started with an attack on Israel by Syria and Egypt on October 5, 1973.

From 1974 to 1978, the world crude oil price was relatively flat ranging from $12.21 per barrel to $13.55 per barrel. When adjusted for inflation world oil prices were in a period of moderate decline.

In 1979 and 1980, events in Iran and Iraq led to another round of crude oil price increases. The Iranian revolution resulted in the loss of 2 to 2.5 million barrels per day of oil production between November 1978 and June 1979.

In September 1980, Iran already weakened by the revolution was invaded by Iraq. By November, the combined production of both countries was only a million barrels per day and 6.5 million barrels per day less than a year before. Consequently worldwide crude oil production was 10 percent lower than in 1979.

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The combination of the Iranian revolution and the Iraq-Iran War cause crude oil prices to more than double increasing from $14 in 1978 to $35 per barrel in 1981.

Factors effecting crude oil:

Firstly, an increasingly short supply of oil in the world is the fundamental cause. According to statistics from the British firm BP, the world has been demanding more oil than can be produced since 1981; and the case is still the same today. Currently, oil production in most countries has already or will soon go down - leaving less of a surplus to use - but at the same time, demand keeps increasing. The supply remains tight and prices keep soaring despite OPEC's decision to increase crude oil production by 500,000 barrels per day as of Nov. 1. With little price elasticity from both demand and supply, any trivial event will send prices skyrocketing.

Secondly, short-term speculations on oil futures by large amounts of funding also drive prices up. A Citi report in May 2006 mentioned that U.S. commodity markets hold an average speculation volume of over 120 billion US dollars each month, chiefly coming from natural gas (30.3 billion dollars) and crude oil (30.1 billion dollars). The numerous speculation deals have a massive impact on oil futures prices considering the leverage effect of futures margin deals. With excessive liquidity worldwide, funds behind oil futures speculations will remain the same.

Thirdly, the U.S. government's pursuit of a weak dollar policy in recent years has also contributed, to a certain degree, to the hike in oil prices. Almost all oil deals worldwide are priced in US dollars; and the dollar's devaluation puts on the pressure for higher oil prices. To maintain an income and purchasing power, raising prices has become a major strategy of OPEC members. According to studies, when the dollar devalues by 1 percent, it causes an oil price hike of the same degree. In addition, technical, meteorological and political elements also affect prices.

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Fundamental analysis:

Fundamental analysis is a means of analysing commodities and trying to predict where the prices of commodities should be trading and what they will do in the future. The main basis for fundamental analysis is supply and demand.

Supply and demand is a very simple equation, but it gets more complicated when you try to forecast prices in the future. Commodities trade in cycles. Some times supplies will be tight and prices will be high. Other times, we just have too much of a commodity and prices fall accordingly. I like to look at commodities that are trading at multi-year highs or lows. Eventually, the picture will change and that will lead to a good trading opportunity.

Price movements in commodities using fundamental analysis can be broken down into these simple formulas:

Demand > Supply = Higher Prices

Supply > Demand = Lower Prices

Supply of Commodities

The supply of a commodity is the amount that is carried over from previous year(s) of production and the amount that is being produced during the current year. For example, the current supplies of soybeans would include the amount of crops in the ground and the amount that is left over from the previous season. Typically, the more that is carried over from the previous season, the lower the prices will fall.

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http://www.wtrg.com/oil_graphs/oilprice1869.gif

There are many factors that can impact the supply of commodities like weather, amount of acres planted, production strikes, crop diseases and technology. The main thing to remember when using fundamental analysis is that high prices for commodities will lead to an increase in production, as it is more profitable to produce commodities when prices are higher. As you might expect, demand will typically drop as prices move higher.

Demand for Commodities

Demand for commodities is the amount that is consumed at a given price level. The rule of thumb is that demand will increase when the price of a commodity moves lower. Oppositely, demand will decrease as the price of a commodity increases. There is an old saying among commodity traders that low prices cure low prices. This means that more of a commodity will be consumed at lower prices, which lowers the supply and thus prices will eventually increase.

Just think about how you would use more gasoline at $1.50 per gallon than you would at $3 per gallon. Fundamental analysis of commodities is simple economics. Consumption patterns change as the prices of commodities move higher and lower.

Using Fundamental Analysis to Predict Future Prices of Commodities

Prices will fluctuate in the short term, so it is not easy to make fundamental forecasts of commodities prices and make short-term trades. It is even more difficult for new commodity traders to do this. I recommend that new traders, and even experienced traders, use a long-term strategy when using fundamental analysis to forecast commodity prices. You should look for trends that are developing that will cause a shift supply and demand factors.

To begin your fundamental research of commodities, there are numerous reports that are compiled by government sources – USDA, department of energy and the futures exchanges. Many of the larger commodity brokers will also publish fundamental research for their clients.

It may seem like a daunting task to find all the current data and compare it to previous years and see how prices reacted under those conditions. Worse yet, you have to forecast in the future as to what the supply and demand scenario will be. I can tell you it is almost impossible to do this, especially since you will be competing against experts who have a lot more information and experience than you.

What you want to do is look for trends in production and consumption and trade

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with that bias. For example, if the supplies of corn are at a five-year high and we just planted a record amount of acres of corn for this season, it is likely that corn futures will trade with a downward bias. You would be likely want to trade from the short side.

Now, at some point, the price of corn will get too low and demand will increase. Or, there might be weather problems during the growing season that will lower the production of corn. In these cases you have to be flexible and realize that prices won’t go down forever.

The longer-term trends in commodities are easier to spot with fundamental analysis, but I prefer to use technical analysis to capture shorter-term movements in commodities prices. Most professional commodity traders like to know what the big picture is with commodities using fundamental analysis and then they use technical analysis to time their entries and exits.

commodity trading strategies:

Scale trading commodities:

Scale trading in commodities is a very interesting trading strategy that is often touted as a “can’t lose” strategy. In theory, that statement might be correct, but the strategy is only as good as the trader using it and the trader has sufficient trading capital.

What Is Scale Trading?

Scale trading uses a simple principle of buying low and selling high. When trading commodities, it is often difficult to figure out when a commodity is trading at a low enough price to buy, but scale trading has some fairly simple guidelines to find good buying levels.

The first thing you want to do is look through historical charts of commodities and find the ones that are trading at the low end of their historical ranges – preferably within the lower 25 percent of their historical price range. You should look back at least 10 years for the historical range. Another thing worth noting is that scale trading works best for physical commodities like corn, crude oil, live cattle, etc. Scale trading was not necessarily meant for financial futures like the E-mini S&P, currencies or Treasury notes.

Scale Trading Strategy

You only initiate trades buy buying when you scale trading commodities. You do not look to sell or short commodities. The reasoning is that physical

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commodities will always hold a certain amount of value. When the price gets too cheap, producers of a commodity will eventually produce less and this will eventually stabilize prices.

Once you have identified a commodity in the bottom 25 percent of its historical range, you will need to set-up levels where you will buy and sell futures contract on that commodity.

For example, if corn were trading at $2.00 a bushel, while the price range for the last 20 years is $1.80 to $5.50, this would be an ideal candidate for scale trading. You could set-up levels to start buying every 10 cents lower - $1.90, $1.80, $1.70, etc. Once your first order is filled at $1.90, you would place an order to sell that contract at $2.00 for a profit of $500 (10 cents times 5,000 bushels).

Now, if the market keeps moving down to $1.80, you would buy another contract and place an order to sell that futures contract at $1.90. Then you would still be holding the other contract you bought at $1.90 with an order to sell at $2.00. The basic theory of scale trading is that you scale into the market at already depressed prices and you sell at predefined prices until all your contracts are closed.

Scale trading a market could take a couple weeks or it could last several years. It is important to make sure you commit yourself to the strategy and follow the rules. More importantly, you have to calculate to maximum amount of futures margin and draw down losses this strategy could incur if the market keeps moving lower. You can also change the price levels to suit your trading style.

Types of Commodity Trading Strategies:

Commodity trading strategies are simply the basis for why and when you will buy and sell commodities. You should have some well thought out strategies before you begin trading commodities. This does not mean watching the financial news or reading a commodity newsletter for the latest trading tips. Rather, you should have consistent strategies that will let you know under what circumstances you will buy, sell and limit your losses.

Most commodity trading strategies use some form of technical analysis for the trading decisions. I mainly use technical analysis when I trade, but I also monitor the fundamentals of the markets. I’ll first discuss the basic commodity trading strategies using technical analysis and then I’ll include some information on using fundamental analysis for trading commodities.

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Most commodity trading strategies consist of either a range trading or breakout methodology. Each type of strategy has its pros and cons, so it is up to your personal taste on which type of strategy might work best for you. I actually use variations of both types of strategies in my trading.

Range Trading Strategy

Range trading in commodities simply means buying near the bottom of a range (support) and selling at the top of a range (resistance). Another way to look at this strategy is that one might look to buy a commodity after it has experienced a lot of selling and becomes oversold. Oppositely, one might look to sell a commodity after it has had a long rally and becomes overbought.

There are numerous indicators which measure overbought and oversold levels like RSI, Stochastic, Momentum and Rate of Change. These strategies work well when the market has no significant trend. However, a trader could have a string of bad losses when a market forms a major trend, as markets can stay overbought or oversold for long periods of time.

Trading Breakouts

Trading breakouts in commodities means that a trader will look to buy a commodity as it makes new highs and sell a commodity as it makes new lows. New highs and lows can easily be spotted on a chart, as they are the peaks and troughs. Many professional traders use these techniques when they are managing large sums of money.

The philosophy for this strategy is simple – a market can’t continue its trend without making new highs or new lows. This strategy works best when commodities are trending strongly. It doesn’t matter whether the trend is up or down, as you are buying new highs and selling (shorting) new lows. The drawback of this strategy is that it performs very poorly when markets don’t establish strong trends.

Fundamental Trading Strategy

While trading breakouts and trading ranges usually come with specific set-ups for buying and selling commodities, fundamental trading leaves much more room for interpretation. For example, you might buy soybeans because the weather has been dry during the summertime and you expect a much smaller crop. Or, you expect demand to increase for crude oil from China, so you buy oil futures.

I do not recommend this type of trading for the new commodity trader, since

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opinions can easily be swayed the hype that is often reported in the news. Even worse, you will be left wondering where to get in and out of the trades. You can get lucky a couple of times trading off the news, but this type of trading claims a huge share of victims every year.

The top commodity exchanges:

1) Chicago board of trade:

Established in 1848, is the world's oldest futures and options exchange. More than 50 different options and futures contracts are traded by over 3,600 CBOT members through open outcry and e trading. Volumes at the exchange in 2003 were a record breaking 454 million contracts. On 12 July 2007, the CBOT merged with the CME under the Group holding company and ceased to exist as an independent entity.

In 1864, the CBOT listed the first ever standardized "exchange traded" forward contracts, which were called futures contracts. In 1919, the Chicago Butter and Egg Board,[1] a spin-off of the CBOT, was reorganized to enable member traders to allow future trading, and its name was changed to Chicago Mercantile Exchange (CME).

On October 19, 2005, the initial public offering (IPO) of 3,191,489 CBOT shares was priced at $54.00 (USD) per share. On its first day of trading the stock closed up +49% at $80.50 (USD) on the NYSE. In 2007, the CBOT and the CME merged to form the CME Group.

2)Chicago mercantile exchange:

It is an American financial and commodity derivative exchange based in Chicago. The CME was founded in 1898 as the Chicago Butter and Egg Board. Originally, the exchange was a non-profit organization. The exchange demutualized in November 2000, went public in December 2002, and it merged with the Chicago Board of Trade in July 2007 to become CME Group Inc. The Chief Executive Officer of CME Group is Craig S. Donohue. On August 18, 2008 shareholders approved a merger with the New York Mercantile Exchange.

CME trades several types of financial instruments: interest rates, equities, currencies, and commodities. It also offers trading in alternative investments such as weather and real estate derivatives.CME has the largest options and futures contracts open

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http://en.wikipedia.org/wiki/Open_interest

http://en.wikipedia.org/wiki/Futures_contract

http://en.wikipedia.org/wiki/Option_(finance)

http://en.wikipedia.org/wiki/Commodities

http://en.wikipedia.org/wiki/Currencies

http://en.wikipedia.org/wiki/Equities

http://en.wikipedia.org/wiki/Interest_rate

http://en.wikipedia.org/wiki/Financial_instrument

http://en.wikipedia.org/wiki/Financial_instrument

http://en.wikipedia.org/wiki/CME_Group

http://en.wikipedia.org/wiki/Chicago_Board_of_Trade

http://en.wikipedia.org/wiki/Chicago_Board_of_Trade

http://en.wikipedia.org/wiki/Initial_public_offering


http://en.wikipedia.org/wiki/Demutualized

http://en.wikipedia.org/wiki/Chicago_Butter_and_Egg_Board

http://en.wikipedia.org/wiki/Chicago

http://en.wikipedia.org/wiki/Derivatives_market

http://en.wikipedia.org/wiki/Derivatives_market

http://en.wikipedia.org/wiki/United_States


http://en.wikipedia.org/wiki/NYSE


http://en.wikipedia.org/wiki/Chicago_Mercantile_Exchange

http://en.wikipedia.org/wiki/Chicago_Board_of_Trade#cite_note-0

http://en.wikipedia.org/wiki/Chicago_Butter_and_Egg_Board


http://en.wikipedia.org/wiki/Chicago_Mercantile_Exchange

http://en.wikipedia.org/wiki/ETrading

http://en.wikipedia.org/wiki/Open_outcry


http://en.wikipedia.org/wiki/Option_(finance)

http://en.wikipedia.org/wiki/Futures_exchange


interest (number of contracts outstanding) of any futures exchange in the world.

On October 7, 2008, the Chicago Mercantile Exchange (CME) Group announced that it will be teaming up with Citadel Investment Group to create a transparent electronic trading platform for credit default swaps. The joint venture between CME and Citadel will operate as an independent organization with its own board of directors and management team. The new venture plans to initially provide clearing services for contracts involving credit-default swap indices, which typically have more standardized terms than swap contracts for individual bonds. It is expected to eventually expand its offering to include other derivative indices as well as the multitude of single name and coporate derivaties.

3) Brazilian Mercantile and Futures Exchange(BMFEX):

Founded on August 23, 1890 by Emilio Rangel Pestana, the "Bolsa de Valores de São Paulo" (São Paulo Stock Exchange, in English) has had a long history of services provided to the stock market and the Brazilian economy. Until the mid-1960s, Bovespa and the other Brazilian stock markets were state-owned companies, tied with the Secretary of Finances of the states they belonged to, and brokers were appointed by the government.

After the reforms of the national financial system and the stock market implemented in 1965/1966, Brazilian stock markets assumed a more institutional role. In 2007, the Exchange demutualized and become a for-profit company.

In 1990, the negotiations through the Sistema de Negociação Electronic a CATS (Computer Assisted Trading System) was simultaneously operated with the traditional system of "Pregão Viva Voz" (open outcry). Currently, BM&FBOVESPA is a fully electronic exchange.

In 1997, a new system of electronic trading, known as the Mega Bolsa, was implemented successfully. The Mega Bolsa extends the potential volume of processing of information and allows the Exchange to increase its overall volume of activities.

4) Minneapolis grain exchange(MGC):

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http://en.wikipedia.org/wiki/Open_outcry

http://en.wikipedia.org/wiki/CATS_(trading_system)

http://en.wikipedia.org/wiki/Brazilian_Mercantile_and_Futures_Exchange

http://en.wikipedia.org/wiki/Credit_default_swap

http://en.wikipedia.org/wiki/Credit_default_swap

http://en.wikipedia.org/wiki/Citadel_Investment_Group

http://en.wikipedia.org/wiki/Citadel_Investment_Group

http://en.wikipedia.org/wiki/Open_interest

It was formed in 1881 as a regional cash marketplace to promote fair trade and to prevent trade abuses in wheat, oats and corn. MGEX has been the principal market for Hard Red Spring Wheat (HRSW) since 1881, offering futures and options contracts based on its unique commodity. Futures are traded exclusively electronically on the CME Globex platform. Options are traded side-by-side. HRSW is one of the highest-protein wheat’s. It is found in bagels, high-quality breads and cereals. It is planted mostly in the U.S. Northern Plains and the Canadian Prairies.

MGEX offers five financially settled agricultural index products: Hard Red Spring Wheat Index (HRSI), Hard Red Winter Wheat Index (HRWI), Soft Red Winter Wheat Index (SRWI), National Corn Index (NCI) and National Soybean Index (NSI).

In 1883, the Chamber of Commerce introduced its first futures contract: hard red spring wheat. By 1946 "Chamber of Commerce" had become synonymous with organizations devoted mainly to civic and social issues. In 1947, the exchange was renamed the Minneapolis Grain Exchange. Today the exchange is most recognized by its logo and uses MGEX as first reference.

On December 19th, 2008, the Minneapolis Grain Exchange ceased operations of the open out-cry trading floor, but continues daily operations for the electronic trading platform. Today, HRSW futures trade exclusively electronically and options trade side-by-side.

5) Multi commodity exchanges(MCX):

It is an independent commodity exchange based in India. It was established in 2003 and is based in Mumbai. The turnover of the exchange for the period Apr-Dec 2008 was INR 32 Trillion. MCX offers futures trading in Agricultural Commodities, Bullion, Ferrous & Non-ferrous metals, Pulses, Oils & Oilseeds, Energy, Plantations, Spices and other soft commodities.

MCX has also setup in joint venture the National Spot Exchange a purely agricultural commodity exchange and National Bulk Handling Corporation (NBHC) which provides bulk storage and handling of agricultural products.

6) National commodities and derivatives exchange(NCDEX):

It is an online commodity exchange based in India. It was incorporated as a private limited company incorporated on April 23, 2003 under the Companies Act, 1956. It obtained its Certificate for Commencement of Business on May 9, 2003. It has commenced its operations on December 15,

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http://en.wikipedia.org/wiki/India

http://en.wikipedia.org/wiki/Commodity_exchange

http://en.wikipedia.org/w/index.php?title=National_Bulk_Handling_Corporation&action=edit&redlink=1

http://en.wikipedia.org/w/index.php?title=National_Bulk_Handling_Corporation&action=edit&redlink=1

http://en.wikipedia.org/wiki/National_Spot_Exchange

http://en.wikipedia.org/wiki/Mumbai


http://en.wikipedia.org/wiki/Commodity_exchange

http://en.wikipedia.org/w/index.php?title=Side-by-side&action=edit&redlink=1

http://en.wikipedia.org/w/index.php?title=CME_Globex&action=edit&redlink=1

2003. NCDEX is a closely held private company which is promoted by national level institutions and has an independent Board of Directors and professionals not having vested interest in commodity markets.

7) National multi commodities exchange (NMCE):

The first De-Mutualised Electronic Multi-Commodity Exchange of India granted the National status on a permanent basis by the Government off india and operational since 26 November 2002.

In response to the Press Note issued by the Government of India during May'1999, first state-of-the-art demutualised multi-commodity Exchange, National Multi Commodity Exchange of India Ltd. (NMCE) was promoted by commodity-relevant public institutions, viz., Central Warehousing Corporation (CWC), National Agricultural Cooperative Marketing Federation of India (NAFED), Gujarat Agro-Industries Corporation Limited (GAICL), Gujarat State Agricultural Marketing Board (GSAMB), National Institute of Agricultural Marketing (NIAM), and Neptune Overseas Limited (NOL).

8) New York mercantile exchange(NYMEX):

It is the world's largest physical commodity futures exchange, located in New York City. Its two principal divisions are the New York Mercantile Exchange and Commodity Exchange, Inc (COMEX) which were once separate but are now merged. The parent company of the New York Mercantile Exchange, Inc., NYMEX Holdings, Inc. became listed on the New York Stock Exchange on November 17, 2006, under the ticker symbol NMX. On March 17, 2008, Chicago based CME Group signed a definitive agreement to acquire NYMEX Holdings, Inc. for $11.2 billion in cash and stock.

The New York Mercantile Exchange handles billions of dollars worth of energy products, metals, and other commodities being bought and sold on the trading floor and the overnight electronic trading computer systems. The prices quoted for transactions on the exchange are the basis for prices that people pay for various commodities throughout the world.

9) Rosario board of trade(ROFEX):

It is a non-profit making association based in Rosario, in the Province of Santa Fe, Argentina. Founded on August 18, 1884, it serves as a forum for the conduct of trade negotiations in several markets including grain, oilseed, agricultural products and their by-products, as well as securities and other assets.

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http://en.wikipedia.org/wiki/Argentina

http://en.wikipedia.org/wiki/Santa_Fe_Province

http://en.wikipedia.org/wiki/Provinces_of_Argentina

http://en.wikipedia.org/wiki/Rosario

http://en.wikipedia.org/wiki/World

http://en.wikipedia.org/wiki/Financial_transaction

http://en.wikipedia.org/wiki/Computer

http://en.wikipedia.org/wiki/Trade

http://en.wikipedia.org/wiki/Sell

http://en.wikipedia.org/wiki/Buy

http://en.wikipedia.org/wiki/Metals

http://en.wikipedia.org/wiki/Energy

http://en.wikipedia.org/wiki/Energy


http://en.wikipedia.org/wiki/New_York_Stock_Exchange

http://en.wikipedia.org/wiki/New_York_Stock_Exchange

http://en.wikipedia.org/wiki/Merged

http://en.wikipedia.org/wiki/New_York_City


http://en.wikipedia.org/wiki/Commodity

http://en.wikipedia.org/wiki/World

http://en.wikipedia.org/wiki/Agricultural_Marketing



The Physical Grain Market of the BCR is the most important in Argentina in terms of its volume of operations, and provides reference prices for the national and international markets. Most of the country's production of cereals and oilseeds is traded within it, especially soybean. The region around Rosario contains more than 80% of the vegetable oil industry of Argentina and its ports, (Rosario and San Lorenzo-Puerto San Martín), handle more than 90% of the Argentine export of soybean and its derivatives.

The Rosario Futures Exchange (ROFEX) has traditionally been a futures exchange for commodities and, in more recent times, for financial products such as exchange rate and interest rate options. Its negotiated volume (especially in forward contracts over dollars) makes ROFEX the largest futures market in the country.

10) London metal exchange:

Established for over 130 years and located in the heart of The City of London, the London Metal Exchange is the world’s premier non-ferrous metals market.

It offers a range of futures and options contracts for non-ferrous & minor metals, steel and plastics.

The Exchange provides a transparent forum for all trading activity and as a result helps to ‘discover’ what the price of material will be months and years ahead. This helps the physical industry to plan forward in a world subject to often severe and rapid price movements. Such is the liquidity at the Exchange that the prices ‘discovered’ at the LME are recognized and relied upon by industry throughout the world.

The LME is a highly liquid market and in 2009 achieved volumes of 111.9 million lots, equivalent to $7.41 trillion annually and $29 billion on an average business day. Based in London the LME is a global market with an international membership and with more than 95% of its business coming from overseas.

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http://www.lme.com/what_contracts.asp

http://en.wikipedia.org/wiki/United_States_dollar

http://en.wikipedia.org/wiki/Forward_contract

http://en.wikipedia.org/wiki/Interest_rate

http://en.wikipedia.org/wiki/Exchange_rate

http://en.wikipedia.org/wiki/Commodities


http://en.wikipedia.org/wiki/San_Lorenzo-Puerto_General_San_Mart%C3%ADn_Port_Complex

http://en.wikipedia.org/wiki/Port_of_Rosario

http://en.wikipedia.org/wiki/Greater_Rosario

http://en.wikipedia.org/wiki/Soybean

http://en.wikipedia.org/wiki/Vegetable_fats_and_oils

http://en.wikipedia.org/wiki/Cereal

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