Daily Agri Report July 31 - Angel...

Commodities Daily Report

Agricultural Commodities

Tuesday| July 31, 2012

www.angelcommodities.com

Content

News & Market Highlights

Chana

Sugar

Oilseed Complex

Spices Complex

Mentha

Potato

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Market Highlights (% change) as on July 30, 2012 Last Prev. day WoW MoM YoY

Sensex 17144 1.81 1.58 0.90 -7.42 Nifty 5200 1.96 1.60 0.98 -6.73 INR/$ 55.43 -0.11 -0.88 -2.43 25.48 Nymex Crude Oil - $/bbl 89.78 0.44 1.86 15.56 -9.85 Comex Gold - $/oz 1620 0.29 2.70 4.52 0.19

Source: Reuters

News in brief

Monsoon rains pick up afresh in central India Monsoon rains have picked up in strength over the hilly regions (not plains) of northwest India and parts of central India. An India Meteorological Department (IMD) update said that rains were reported from Orissa, west Uttar Pradesh, Uttarakhand, Himachal Pradesh, Madhya Pradesh and Chhattisgarh during the 24 hours ending Monday morning. North-west India (-39 per cent) and the peninsula (-22 per cent) continued to be the worst hit. East and north-east India too has fallen back to double-digit figures (-10 per cent). Central India, which has come under a few of the latest surges of rain, has brought down the deficit to 20 per cent. More rains have been forecast for the region over the next few days, to the near-total exclusion of both north-west India and interior peninsula. The west coast, as usual, could be the sole exception. Scattered showers are also likely for the state of Gujarat, says an outlook by the US National Centre’s for Environmental Prediction. (Source: Business Line)

Drought no reason to ban food export Below-normal rainfall in India this year is not an isolated phenomenon. The drought in the US has been unprecedented. Parts of the former Soviet Union, specifically, Russia, Ukraine and Kazakhstan, are hit by a severe dry spell. About 100 million tonnes (mt) of corn, wheat and soybean have been virtually written off. El-Nino is projected to cause dry weather in Australia/Argentina in the coming months. Except rice, prices of agro commodities overseas have risen abnormally, even as their softening was anticipated due to harvest pressure in July-August. India still carries excess grain and sugar, while the shortfall in pulses and edible oils is pronounced. Some comfort can, however, be derived from higher dollar realization of 6 million tonnes of soy/ rape meal exports ($2.5-3billion) by India. Hence, it makes sense to take advantage of rising values of rice, wheat, corn, sugar, oil meals for exports where India enjoys more than adequate availability. These higher values can be used to meet the shortfall in pulses and edible oils through imports. Export restrictions or bans are no solution when surpluses are rotting. (Source: Business Line)

Wheat prices up in Russia Concern over poor harvest yields pushed wheat prices higher in Russia's eastern regions last week, adding to speculation the government may be forced to sell a part of its stock, analysts said on Monday. Russia is ready to sell some grain via State interventions, Agriculture Minister, Mr Nikolai Fyodorov, said last week but did not specify when the intervention could take place. From April to June, Russia sold about 2 million tonnes (mt) of grain in State interventions and still has about 5 mt in its stock. The SovEcon consultancy said in a note. “The pace of Russia's grain exports in 2012/13 season still lags the previous year. In the first three weeks of July, Russia exported 1.13 mt grains as against last year’s 1.66 mt. (Source: Business Line)

Bengal farmers sow premium rice varieties for better prices Lack of remunerative price for plainer qualities, has seen several farmers in Burdwan – the rice bowl of the State – experiment with low-yield paddy varieties such as Banskati, Sonam, Miniket and others, selling at a premium in the open market. The crisis was a result of State diktat asking mill owners to procure common paddy varieties at MSP (minimum support price). In the absence of commensurating State procurement of rice at MSP, mills are thrown to the vagaries of open market. The end result is farmers are either asked to offload crop at a lower price or end with unsold harvest. Compared with a 40 per cent margin pocketed by the trade (over and above the selling price of rice at mill end) from end consumer and the higher risk of crop loss in producing such varieties; the game is not adequately balanced in favor of the farmer. (Source: Business Line)

U.S. weekly crop progress highlights - USDA US cotton condition is 44 pct good/excellent as compared to 47 pct wk ago, and 30 pct a year ago. US corn condition is 24 pct good/excellent, as compared to 26 pct wk ago, and 62 pct yr ago. US soybeans condition is 29 pct good/excellent, as compared to 31 pct wk ago, and 60 pct yr ago. (Source: Reuters)

Malaysia's July palm oil exports down 14.8 pct-ITS - RTRS Exports of Malaysian palm oil products for July fell 14.8 percent to 1,234,603 tonnes from 1,449,280 tonnes shipped during June, cargo surveyor Intertek Testing Services said on Tuesday. (Source: Reuters)

U.S. corn and soy ratings slip 2 pts, worst since 1988 - RTRS Corn and soybean conditions in the U.S. Midwest deteriorated further last week as the most expansive drought in more than 50 years ate away at crop prospects in major producing states including Iowa and Illinois, government data on Monday showed. The U.S. Department of Agriculture rated 24 percent of the U.S. corn crop in good-to-excellent condition as of Sunday and 29 percent of the soybean crop in good-to-excellent shape, both down 2 percentage points from the previous week. The ratings for each were the worst since the comparable week in 1988, another year of severe drought in the nation's crop-growing mid-section. Crops improved marginally in Ohio and Indiana where condition ratings were already among the poorest in the country and in smaller-producing states such as Wisconsin and Michigan, but those improvements were overshadowed by eroding ratings in the top producing states in the central and western Midwest. Much of the U.S. corn crop was largely beyond repair, but soybeans were moving into their critical flowering and pod-setting phase of development when heat and moisture stress can be devastating to yields. (Source: Reuters)

Revision/Imposition of Special Margin in Potato (POTATO) Trading and Clearing members are hereby informed that in terms of Bye-laws, Rules and Regulations of the Exchange, existing Special Margin of 15% (in cash) on the Long side shall be increased to 30%(in cash) and Special Margin of 5% (in cash) on the Short side shall be imposed on all the running contracts in Potato (SYMBOL: POTATO) with effect from beginning of day Wednesday, August 01, 2012. (Source: NCDEX)

Potato turns hot on monsoon woes Emerging demand at lower levels amid the upcoming festive season and deficient rainfall in growing belts are fuelling up the prices. Sowing in Maharashtra has been affected due to delayed arrival of Monsoon which is still scanty. The area for khariff is expected to be less or may be same with delayed planting compared with last year but it depends on further rains. (Source: Business Line)

Expect WPI food inflation to rise into double digits in coming months As delayed monsoons hurt production of vegetables, cereal and oilseeds, she expects WPI food (primary and manufactured) inflation, which is currently 9% y-o-y, to rise into double digits in the coming months. This will keep both WPI and CPI inflation elevated above the central bank`s comfort zone. (Source: MyIRIS)





Market Highlights as on July 30, 2012

% change

Unit Last Prev day WoW MoM YoY

Chana Spot - NCDEX (Delhi)

Rs/qtl 4713 -0.40 -6.16 5.90 49.95

Chana- NCDEX Aug '12 Futures

Rs/qtl 4599 2.04 -4.43 3.56 42.25

Source: Reuters

Technical Chart - Chana NCDEX Aug contract

Source: Telequote

Technical Outlook valid for July 30, 2012

Contract Unit Support Resistance

Chana Aug Futures Rs./qtl 4520-4550 4660-4720

Chana Chana futures that extended the losses of the previous week on Monday bounced back and settled 2.04% higher. Improved demand at lower price levels supported the firm sentiments

As per the latest report from IMD, overall monsoon since the beginning of the season till 30th July has been 21% below normal. Lower rains in major Kharif pulses growing belts of Rajasthan, led to lower sowing of Kharif pulses this season.

Although Chana is a Rabi crop, it also takes cues from monsoon and sowing progress of Kharif crops.

Government released fourth advance estimates wherein it revised upward Chana output at 7.58 mn tn from 7.4 mn tonnes estimated in the third advance estimates and 8.22 mn tn in 2010-11.

Sowing progress and demand supply fundamentals

According to the Ministry of Agriculture 62.99 Lakh hectare area has been planted under Kharif pulses as on 27th July, 2012 compared to 76.62 lakh hectare (ha) same period last year, a decline of 17.8% . Sowing is reported lower mainly in Rajasthan.

Rajasthan Agriculture Department states that planted area under Kharif Pulses is down at 8.11 lakh hectares ha compared to 17.17 lakh ha same period last year. (Dated 27th July, 2012). Acreage may remain lower as farmers in Rajasthan may shift to other lucrative crops.

However, in AP and Maharashtra, Kharif sowing is up by 5% and 0.2% at 3.96 lakh hectares and 16.98 lakh hectares.

According to the Fourth advance estimates, Pulses output is pegged at 17.21 mn tn in 2011-12 compared with 18.24 mn tn produced in the year 2010-11. While Chana output in 2011-12 is estimated at 7.58 million tones, Tur is estimated at 2.65 million tones, Urad is estimated at 1.83 million tones, moong is estimated at 1.71 million tones.

As per the latest release, Ministry of Commerce & Industry revealed that 20.23 lakh tones of peas, 2.03 lakh tons of Chana, 4.32 lakh tons of urad & moong, 1.12 lakh tons of Masoor and 4.26 lakh tons of Tur has been imported by India during April11-March 12.

India's consumption of pulses is on the rise with an annual growth of around 5% but production is seen lower, which may lead to increase in imports this year. However, rupee weakness may turn import costlier. Around 74% of Indian chickpea imports come from Australia.

Outlook Chana prices may extend the gains of the previous session on account of improved buying at lower level. However, government takes some measure to curb the rising prices of Pulse, like imposition of stock limits, prices might come under downside pressure. In the medium term to long term, the trend remains positive as supplies may not be sufficient to meet the rising demand of the commodity. Also lower sowing of kharif pulses may support chana prices.






% Change Unit Last Prev. day WoW MoM YoY Sugar Spot- NCDEX (Kolkata) Rs/qtl 3555 -0.43 0.61 8.70 18.48

Sugar M- NCDEX Aug '12 Futures Rs/qtl 3379 0.27 1.96 12.63 23.46

Source: Reuters

International Prices as on July 30, 2012

% Change Unit Last Prev day WoW MoM YoY

Sugar No 5- Liffe- Oct'12 Futures

$/tonne 620.2 0.98 -3.93 2.06 -17.56

Sugar No 11-ICE Oct '12 Futures

$/tonne 506.67 1.24 -4.56 6.44 -19.03

Source: Reuters

Technical Chart - Sugar NCDEX Aug contract

Source: Telequote



Sugar Aug NCDEX Futures Rs./qtl 3320-3355 3395-3425

Sugar Sugar futures traded on a positive note yesterday due to the ongoing weather concerns, due to which the production of sugar is likely to fall in the 2012-2013 season. The spot settled lower by 0.43% while the Futures settled higher by 0.27% on Monday.

The Government has decided to convert levy sugar stock for the sugar seasons 2008-09 and 2009-10 to the extent of 2.66 lakh MT into non-levy sugar to be sold by the concerned sugar mills by August.2012. This would make available an additional non-levy sugar quantity of about 2.66 lakh MT for sale by August 2012 apart from the 45 lakh tonnes quarterly quota for July-Sep. (PIB)

The government, last week confirmed that it had allocated additional 2 lakh tn sugar as non-levy quota for the current quarter ending Sep 30th from the unsold quantity from the Apr-Jun allocation, which will now be allowed to be sold till Aug 14.

The government increased the FRP on sugarcane in the new season starting October 1 to Rs 170 per quintal, from Rs 145 per quintal in the current season.

With 22% below normal rains so far in the current season in the major growing areas of Maharashtra, UP and Karnataka, sugarcane yield is expected to decline thereby, raising concerns over next year’s sugar output.

In the international markets Liffe white sugar as well as ICE raw sugar settled 0.98% and 1.24% higher on Monday.

Domestic Production and Exports

As on 27th July, 2012, the area under sugarcane is estimated at 52.85 lakh ha, up from 47.03 lakh ha on same period a year ago.

Despite of higher acreage, the producers body has estimated next year’s output lower at 25 mn tn, down by 1 mn tn compared to the current year. Sugar production in India — the world’s second-biggest producer — touched 26 million tonne since October 1, 2011.

With the opening stocks of 6.8 mn tonnes, domestic Sugar supplies are estimated at 32-33 mn tn against the domestic consumption of around 22.5-23 mln tn for 2012-13 season.

Global Sugar Updates

According to Unica, Mills in Brazil's main center-south cane region produced 9.32 mn tn of sugar since April, down 22 percent from a year ago, With a return to a normal weather pattern, cane harvesting is in full swing. While sugar output reached 2.63 mn tn in the first two weeks of July, up 2% from a year ago.

Brazil's exports of raw sugar fell to 1.29 million tonnes in June, down by 30% from 1.85 million tonnes a year earlier.

The global sugar surplus remains on target to fall in 2012/13 season, though declines will be less than previously suggested, while adverse weather in several producers may stop prices dropping far below recent levels. (Source: Reuters)

According to the International Sugar Organization (ISO), the global sugar surplus is forecast to halve to around 3 mln tn in 2012/13 (October-September) from a surplus of 6.5 million tonnes in 2011/12).

Outlook

Sugar prices may trade on a positive note on weather concerns. However prices may correct on fears government may take some measure to curb the rising prices of Agri commodities. Overall outlook of sugar would be dependent on monsoon in the next few weeks. It is necessary to track the monsoon progress in India, as the southwest monsoon is crucial during the growth phase of the cane crop.





Market Highlights as on July 30 2012

% Change


Soybean Spot- NCDEX (Indore)

Rs/qtl 4592 -1.82 -7.38 14.86 92.05

Soybean- NCDEX Aug'12 Futures

Rs/qtl 4474 -1.79 -8.89 10.29 86.15

Ref Soy oil Spot- NCDEX(Indore)

Rs/10 kgs 778 -0.22 -1.69 3.62 16.85

Ref Soyoil- NCDEX Aug '12 Futures

Rs/10 kgs 778.9 -0.45 -2.64 2.63 18.18

Source: Reuters

as on July 30, 2012

International Prices Unit Last Prev day WoW MoM YoY

Soybean- CBOT- Aug'12 Futures

USc/ Bushel 1726 2.46 1.60 19.31 25.10

Soybean Oil - CBOT-Aug'12 Futures USc/lbs 52.57 1.02 -2.20 3.46 -8.25

Source: Reuters

Crude Palm Oil as on July 30, 2012 % Change

Unit Last Prev day WoW MoM YoY CPO-Bursa Malaysia – July '12 Contract

MYR/Tonne 2980 2.72 0.61 -0.10 -12.35

CPO-MCX- July '12 Futures

Rs/10 kg 565.1 -0.05 -1.69 0.04 14.21

Source: Reuters

RM Seed as on July 30, 2012


RM Seed Spot- NCDEX (Jaipur)

Rs/100 kgs 4211 -3.46 1.49 9.36 42.74

RM Seed- NCDEX Aug '12 Futures

Rs/100 kgs 4288 -1.67 -1.65 7.93 46.50

Source: Reuters

Technical Chart –Soybean NCDEX Aug contract

Source: Telequote



Soy Oil Aug NCDEX Futures Rs./qtl 765-772 783-789

Soybean NCDEX Aug Futures Rs./qtl 4325-4410 4530-4585

RM Seed NCDEX Aug Futures Rs./qtl 4180-4235 4372-4405

CPO MCX Aug Futures Rs./qtl 556-562 569-573

Oilseeds

Soybean: Soybean futures declined on Monday on higher sowing coupled with good rains in the major soybean growing regions. The Spot as well as Futures settled 1.82% and 1.79% lower respectively on Monday.

In the domestic markets, As on 27th July Oilseeds have been sown in 138.33 lakh hectares so far, compared with 139.87 lakh hectares same period last year. Soybean area is higher by 7.63% at 101.53 lakh hectares. Government released its Fourth advance estimates, wherein total oilseeds output is pegged at 30.01 million tn, in which Soybean output is pegged at 12.28 mn tn in 2011-12.

According to a circular issued by NCDEX, existing Special Cash Margin of 5% on the Long side shall be increased to 20% on all the running and yet to be launched contracts w.e.f beginning of 18/07/2012.

In the international markets CBOT gained and closed up by 2.46% on Monday on ongoing weather concerns in US Midwest. According to the weekly US crop progress report, 29% of the Soybean crop is in good to excellent condition compared with 31% a week ago.

The USDA monthly report released on 11th July, pegged U.S. oilseed production for 2012/13 season at 92.7 million tons, down 4.2 million from last month. Soybean production is projected at 3.050 billion bushels, down 155 million. Soybean ending stocks are projected at 130 million bushels, down 10 million.

Refined Soy Oil: NCDEX Soy Oil and MCX CPO settled lower on Monday on account of lower demand and seasonally higher output capped the upside in edible oil prices.

India imported 124,125 tonnes of refined palm oil in June, down nearly 25 percent from May. Total vegetable oil imports in June were 783,315 tonnes, down 12.7 percent from 896,921 tonnes in the previous month, the data from the Solvent Extractors' Association (SEA) showed.

Malaysian palm oil Production has risen consistently since March 2012 and expected to go as high as 1.9 mn tn in September. On the other hand, exports have fallen 14.8 percent in July to below 1.23mn tonnes compared to 1.45mn tonnes a month ago due to a lull in Asian demand.

Malaysia will increase shipping quotas for tax free CPO by up to 2 mn tn to 5 mn tn this year to help planters cope with an expected increase in output.

Rape/mustard Seed: NCDEX mustard seed futures witnessed further correction on Monday tracking entire edible oil segment, while the spot remained positive as fundamentals remain supportive on account of good demand of mustard seed for crushing. Due to a sharp rise in the Soybean and thereby Soy meal prices, the demand for mustard meal has increased in the past few days while supplies continue to remain tight.

According to a circular issued by NCDEX, existing Special Cash Margin of 5% on the Long side shall be increased to 15% on all the running and yet to be launched contracts w.e.f beginning of 18/07/2012.

Outlook

Oilseed complex may trade sideways on fears of government intervention to curb the rising prices in agri commodities. Also, Refine soy oil and CPO may trade lower on account of lower than normal demand of edible oil during the festival season.






% Change


Pepper Spot- NCDEX (Kochi)

Rs/qtl 42933 0.96 2.45 6.65 39.56

Pepper- NCDEX Aug '12 Futures

Rs/qtl 44680 1.58 3.55 9.72 35.73

Source: Reuters

Technical Chart – Black Pepper NCDEX Aug contract

Source: Telequote



Black Pepper NCDEX Aug Futures Rs/qtl 44150-44400 45000-45370

Black Pepper Pepper Spot as well as Futures traded on a positive note yesterday due to diminishing stocks as well as good demand in the spot markets ahead of the festive season. The Spot as well as the Futures settled 0.96% and 1.58% higher on Monday. According to the circular released on June 13th 2012 the existing Special margin of 10% (cash) on the long side stands withdrawn on all running contracts and yet to be launched contracts in Pepper from beginning of day Friday June 15, 2012. Pepper prices in the international market are being quoted at $8,400/tonne(C&F) while Vietnam was offering its produce at $6,000/tonne for 500 GL. Brazil was offering its pepper at $6,150/tonne for the B-Asta grade. As per circular dt. 29/06/2012 issued by NCDEX, Hassan will be available as an additional delivery centre for all the yet to be launched contracts. (not applicable to the currently available contracts-till Dec 2012 expiry).

Exports According to Spices Board of India, exports of pepper in April 2012 fell by 47% and stood at 1,200 tonnes as compared to 2,266 tonnes in April 2011. India imported 1,848 tonnes of pepper till March 2012 and has become the third country to import such large quantity after UAE and Singapore. (Source: Agriwatch) According to Vietnam Ministry of Agriculture and Rural Development (MARD) exports of black pepper in 2012 are forecasted to fall by 30 percent to around 86,000 tonnes. Exports of Pepper from Vietnam during January till mid of June 2012 is estimated around 62000 mt almost same as that of corresponding year last year. In value terms however it increased by more than 25 percent. Exports of Pepper from Brazil during January till May 2012 are estimated around 13369 mt. (Source: Peppertradeboard). Pepper imports by U.S. the largest consumer of the spice declined 14.8% in the first 2 months of the year (2012) to 8810 tn as compared to 10344 tn in the same period previous year. Imports of Pepper in the month of February declined by 16.8% to 3999 tn as compared to 4811 tn in the month of January 2012. Exports from Indonesia posted significant decrease of 42% as compared to previous year. Exports stood at 36,500 tonnes as compared to 62,599 tonnes in the last year. During May 2012 Brazil exported 1,705 tonnes of pepper as against 1600 tn in May 2011.

Production and Arrivals Arrivals of pepper in domestic market stood at 82 tonnes while offtakes were 80 tonnes on Monday. Global Pepper production in 2012 is expected to increase 7.2% to 3.20 lakh tonnes as compared to 2.98 lakh tonnes in 2011 with sharp rise of 24% in Indonesian pepper output and in Vietnam by 10%. According to latest report pepper output in Vietnam is estimated to be 1.35 lakh tonne as compared to 1.10 lakh tonne estimated early in the beginning of year (2012). Domestic consumption of Pepper in the world is expected to grow by 3.03% to 1.25 lakh tonnes while exports are likely to grow by 1.48% to 2.46 lakh tonnes in 2012. (Source: Peppertradeboard) On the other hand production of pepper in India in 2011-12 is expected to decline further by 5% to 43 thousand tonnes as compared to 48 thousand tonnes in the last year. Production is lowest in a decade. Outlook Pepper prices in the intraday are expected to continue to trade upwards as lower stocks as well as good demand in the spot markets are likely to support the prices. Also, scanty rainfall in the pepper growing regions is likely to support the prices at lower levels. On the other hand reports of fresh arrivals from the Indonesia and Malaysia might cap sharp gains in the short term.






% Change


Jeera Spot- NCDEX(Unjha)

Rs/qtl 15996 -1.50 1.14 13.10 2.30

Jeera- NCDEX Aug '12 Futures

Rs/qtl 15360 -1.76 -2.82 10.80 -5.01

Source: Reuters

Technical Chart – Jeera NCDEX Aug contract

Source: Telequote

Market Highlights as on July 30, 2012 % Change


Turmeric Spot- NCDEX (N'zmbad)

Rs/qtl 5220 -6.58 -2.02 38.55 -21.45

Turmeric- NCDEX Aug '12 Futures

Rs/qtl 5702 -1.11 -5.31 37.40 -7.53

Technical Chart – Turmeric NCDEX Aug contract

Source: Telequote


Unit Support Resistance

Jeera NCDEX Aug Futures Rs/qtl 15050-15150 15625-15850

Turmeric NCDEX Aug Futures Rs/qtl 5510-5600 5766-5832

Jeera Jeera futures corrected yesterday for the 4th continuous session as participants were booking profits after the government said that it might take some action or curb the rising price. Also, the farmers were selling their stocks on better realisation. The arrivals in the spot have also increased due to high prices.. The spot as well as the Futures settled 1.5% and 1.76% lower on Monday. Expectations are that large export orders may be diverted to India from the international markets due to the ongoing civil war in Syria which is hampering supplies. Export demand from Bangladesh, Pakistan and other countries may support the prices at lower levels. Production in Syria and Turkey is being reported around 1,000 tonnes and around 5,000 tonnes, lesser than expectations. Jeera prices in the international market of Indian origin are being offered at $2,900-2950/tn (c&f) while Syria and Turkey are not offering their produce. Carryover stocks of jeera in the domestic market is expected to be around 7-8 lakh bags as compared to 4-5 lakh bags in the last year.

Production, Arrivals and Exports Unjha markets witnessed arrivals of 13,000 bags, higher by 1,000 bags as compared to previous day while off-takes stood at 10,000 bags on Saturday. Production of jeera in 2011-12 is expected to be around 40 lakh bags as compared to 29 lakh bags in 2010-11 (each bag weighs 55 kgs). (Source: spot market traders).

According to Spices Board of India, exports of Jeera in April 2012 stood at 2,500 tonnes as compared to 2,369 tonnes in April 2011, an increase of 6%. Outlook Jeera prices are expected to open lower due to increasing supplies, but may bounce back tracking supply concerns in the global markets. Also, export demand is likely to support prices at lower levels. In the medium to long term (July-September 2012) prices are likely to witness a bounce back as there are limited stocks with Syria and Turkey and crop there is 30% short as compared to last year.

Turmeric Turmeric Futures witnessed a very volatile session yesterday as the regulator increased cash margins to curb the price rise. The spot also corrected sharply. Rainfall in Nizamabad is 24% lower than the normal as on 25/7/2012. Turmeric has been sown in 0.31 lakh hectares in A.P as on 25th July 2012. The arrivals in the spot market are reported to be of fine quality, supporting to the prices. The Spot as well as the Futures settled 6.58% and 1.11% lower on Monday. As per circular dt. 28/07/2012 issued by NCDEX, the pre expiry margin on Turmeric has been increased to 5% for last 7 trading days increased on a daily basis on both buy and sell side from the existing 3% on daily basis for last 5 days. Production, Arrivals and Exports Arrivals in Erode and Nizamabad mandi stood at 12,000 bags and 4,000 bags respectively on Monday. Turmeric production for the year 2011-12 is projected at historical high of 90 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 2010-11. Erode is expected to produce 55 lakh bags of turmeric a rise of 29% as compared to previous year. According to Spices Board of India, exports of Turmeric in April 2012 increased by 1% at 7,300 tn as compared to 7,230 tn in April 2011. Outlook Turmeric prices are expected to continue to trade lower as imposition of additional cash margin may led to a sharp correction. However, scanty rains in the key growing regions may lead to lower sowing of turmeric, supporting prices at lower levels. In the medium to long term (July to September) prices may take cues from the sowing figures.






% Change


Mentha Oil- MCX Spot (Chandausi)

Rs/qtl 1468 -0.02 0.12 9.73 30.14

Mentha Oil MCX – July Futures

Rs/qtl 1311 1.17 -1.89 7.13 16.20

Source: Reuters

Technical Chart – Mentha Oil MCX Aug contract

Source: Telequote

Market Highlights as on July 30 2012 % Change


Potato Spot- NCDEX (Agra)

Rs/qtl 1175 -0.78 2.25 16.76 179.39

Potato- NCDEX Aug '12 Futures

Rs/qtl 1273 0.66 0.83 17.70 250.84

Technical Chart – Potato NCDEX Aug contract

Source: Telequote


Unit Support Resistance

Mentha Oil Aug Futures Rs/kg 1305-1315 1348-1370

Potato NCDEX Aug Futures Rs/qtl 1255-1265 1288-1300

Potato MCX Aug Futures Rs/qtl 1318-1330- 1358-1370

Mentha Oil Mentha oil Futures bounced back yesterday after correcting for the last 3 sessions on buying by stockists at lower levels. The spot settled marginally lower by 0.02% while the Futures settled 1.17% higher on Monday.

Total Special Cash margin of 25% on the long side of Mentha Oil has been reduced to 10% in the May contract and 5% in June contract onwards from May 5, 2012. For detailed reference please refer to the Circular No: MCX/T&S/180/2012 dated 03/05/2012.

Production, Arrivals and Exports According to spot market sources, the overall acreage is estimated to increase from 1.75 lakh ha to 2.1 lakh ha this year. The overall production of Mentha is expected to increase by 30% - 40% as compared to last year.

Arrivals of the fresh crop have started in the main sowing regions and currently stand around 1200 drums (each drum weighs 180 kgs). Exports of Mentha during April 2011 to January 2012 witnessed a decline of 6% to 12,850 tonnes as compared to 13,550 tonnes in the same period last year.

Outlook

In the intraday trading session Mentha oil is expected to trade sideways with a positive bias. The expiry of the July contract may lead to some volatility in the intraday. In long to medium term (July-September) prices are likely to remain under pressure due to peak arrival period.

Potato Potato futures closed up by 0.79% on account of ongoing demand in the market amid upcoming festive season. As per circular issued by NCDEX dated 04.06.12, Special margin (cash) on potato on long side have been reduced to 15% from 25% & Additional margin (cash) of 5% on both long and short position have been withdrawn. Margins will be in effect from Wednesday 06, 2012.

Production and Arrivals Scenario Around 200-220 lakhs MT potato had been stored in the country in different cold storages during the current season. Although 27-30% of the cold storage stocks are released so far from overall producing belts, they are much lower compared to normal 35-38% every year.

According to NHRDF, The sowing of potato seed for Kharif production in Karnataka completed but the area sown is adversely affected due to less and delayed rains. The sowing in hills of Himachal Pradesh, Uttarakhand and Jammu and Kashmir are also completed. The seed sowing in Maharashtra for Kharif is continued, which is delayed due to delay arrival of monsoon, which is still scanty. The area for Kharif is expected to be less or may be same with delayed planting compared to last year, but it depends on further rains.

With reports of crop damages in Karnataka, the supplies from this region to other states may also be affected as the overall output is expected to decline by 70-75%. In fact, the state may have to rely on the supplies from the north Indian markets.

Outlook Potato futures in intraday might trade firm as a result of emergence of fresh demand in the market owing to festive season. However, tight supplies amid crop failure in Karnataka might provide support to prices in short term. Also soaring Vegetable prices may keep the demand for potato strong thereby keeping the sentiments upbeat in Medium term.

Daily Agri Report July 31 - Angel...

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