daily agri report sep 1 -...

Commodities Daily Report

Agricultural Commodities

Saturday| September 1, 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 Aug 31, 2012 Last Prev. day WoW MoM YoY

Sensex 17542 0.29 -1.73 2.32 8.64 Nifty 5315 0.52 -1.85 2.22 9.82 INR/$ 55.52 -0.27 0.05 0.16 21.25 Nymex Crude Oil - $/bbl 96.47 0.48 0.33 7.45 8.63 Comex Gold - $/oz 1684.60 4.25 0.89 4.01 -7.87

Source: Reuters

News in brief Despite monsoon deficit shrinking, kharif sowing lags Despite the monsoon gathering momentum in August, sowing of most kharif crops continued to lag with the shortfall being more pronounced in coarse cereals, oilseeds (barring soyabean) and pulses (barring urad). Farmers have so far planted only 167.87 lakh hectares (lh) under coarse cereals against 193.37 lh during the same period a year ago. Among coarse cereals, the shortfall in acreage is in bajra, sorghum and ragi. Lower sowing in Karnataka has dragged maize and ragi acreage. Pulses have been planted on 97.7 lh so far. Moong cultivation has been affected in Karnataka and Rajasthan. Arhar (tur) planting, too, has been lower in Karnataka and Maharashtra. Sowing in cash crops such as groundnut and cotton, too is lower as poor rain in Gujarat played the spoilsport. Oilseeds sowing was estimated at 16.7 mln ha as against 17.5 mln ha a year ago, the data showed. Among oilseeds, groundnut sowing was at 3.7 mln ha so far, down from 4.2 mln ha a year ago. Farmers have sown soybean over 10.7 mln ha, slightly more than the year ago crop acreage of 10.3 mln ha. Cotton sowing was also down at 11.3 mln ha from 11.8 mln ha a year ago. The area under cane remained unchanged on week at 5.3 mln ha, compared with 5.1 mln ha in the corresponding period last year.Gujarat has seen a three-lakh-hectare drop in cotton acreage. (Source: Business Line)

Four states declare drought in more than 390 talukas: Govt Four states -- Karnataka, Maharashtra, Gujarat and Rajasthan -- have declared drought in over 390 talukas so far and central teams will visit these states to assess the situation, Parliament was informed on Friday. In a written reply to the Rajya Sabha, Agriculture Minister Sharad Pawar said four states have declared drought so far. The central teams have been constituted to visit these states for assessing the situation." Rainfall deficiency is 12 per cent so far. The ministry is closely monitoring monsoon situation along with India Meteorological Department and state governments, he said. According to the data placed before Parliament, maximum number of taluks declared drought-hit were in Karnataka at 142, followed by Gujarat (132 talukas), Maharashtra (122 talukas) and Rajasthan (five districts). Replying to another question on the impact of drought on foodgrains production, Pawar said, "It is too early to assess impact of deficiency in rainfall on production of crops during the current year." (Source: Business Standard)

Centre hikes price for open sale of wheat, allots 10 lakh tonnes The Centre has allocated 13 lakh tonnes (lt) of wheat for sale in the open market during September-October to bulk consumers. Of this, it has set aside three lakh tonnes as reserve with the Food Corporation of India for allocation to non-wheat procuring States. The Food Ministry has also raised the price for the wheat under the open market sale scheme to Rs 1,285 a quintal from Rs 1,175 last month. In addition, buyers will have to pay freight charges from Ludhiana. Earlier, consumers were not asked to foot freight charges. In addition, buyers will have to pay freight charges from Ludhiana. The Tamil Nadu Roller Flour Mills Association, in a statement, said that the allocation was meagre compared with the quantity sought by it. According to sources, though the Centre had decided to release 30 lt of wheat under the open market sale scheme only 13 lt have been released so far. Flour mills in the country, particularly South, are starved of stocks despite coming forward to offer a higher price. “We now have to pay Rs 2,100 a quintal for getting wheat from the open market,” said a miller from Karnataka. (Source: Business Line)

Onion sowing delay could hit supply in mid-October Delay in onion sowing due to deficient rains in the key growing states of Maharashtra and Karnataka is expected to hit supplies by mid-October and push up retail prices. A trader from Nasik, the hub of country's onion trade, said due to delay in rains, the transplanting activities have been hit, particularly in the two states. (Source: Financial Express)

Govt mulls steps to tackle high prices of essential commodities as output falls The food ministry has proposed several steps to tackle the high prices of essential commodities, on fears of a shortfall in the production of crops and their delayed arrival. It is considering extending the limit for holding pulses and edible oil stocks for another year, starting October. Officials, however, clarified the stock holding limit might be announced along with a revamp of the subsidy scheme. They added the stock holding limit may also be extended to rice. To quell the rising prices of sugar, the ministry has decided to release additional sugar in the market, under the non-levy category; even as the levy quota of 10 per cent would remain intact. The ministry also plans to subsidise the distribution of pulses and edible oil, under the Public Distribution System. Due to the erratic monsoon at the beginning of the kharif season this year, most pulses and oilseeds crops would either see a shortage or a delay in arrival. In both cases, prices are expected to remain firm. The government has already allowed the import of pulses and edible oil. (Source: Business Standard)

Record wheat output wards off base effect in agri GDP A record rabi harvest, especially for wheat, propelled India’s agriculture gross domestic product (GDP) for the quarter ended June to 2.9 per cent, compared with the market estimates of one per cent. Growth in agriculture GDP in the corresponding period last year stood at 3.7 per cent. According to data released on Friday, agriculture, forestry and fishing expanded 2.9 per cent during the quarter, helping raise overall GDP growth to 5.5 per cent, against 5.3 per cent in the year-ago period. Growth in the sector, which has a share of about 16 per cent in the GDP, was expected to fall to about one per cent, owing to a high base and fall in rabi pulses and oilseeds output. The Prime Minister’s Economic Advisory Council, in its full-year estimate for 2012-13, said agriculture growth was expected to slow to 0.5 per cent from 2.8 per cent in 2011-12, owing to the impact of the drought. (Source: Business Standard)

Crop Traders Extend Bull Run as Rain Comes Too Late Corn and soybean traders extended their longest bullish outlook in at least 11 months on speculation rain in the U.S. will come too late to revive crops after the worst drought in a half century. Rain in the Midwest may be too late to improve yields because farmers already started the corn harvest and soybeans are reaching maturity. Credit Suisse Group AG said Aug. 29 the rally will to continue for several more months. “The crop needed these rains a month ago,” said Christopher Gadd, an analyst at Macquarie Group Ltd. in London. “We expect to see prices of corn move closer to $9 a bushel. The situation for soybeans looks far more difficult because demand remains resilient at these levels.” (Source: Bloomberg)

Dearer soyameal forces poultry farmers to search for feed substitutes To combat soaring prices of soyameal, a key feed ingredient, poultry farmers have started to look towards alternative commodities. They have started using guarmeal, cottonseed de-oiled cake, rapemeal, sesamum cake and groundnut meal as substitutes for fish oil and soyameal. Feed costs account for one-third of the production cost of production. (Source: Business Line)





Market Highlights as on Aug 30, 2012

% change

Unit Last Prev day WoW MoM YoY

Chana Spot - NCDEX (Delhi)

Rs/qtl 4817 -0.83 -1.07 -3.65 35.38

Chana- NCDEX Sept '12 Futures

Rs/qtl 4650 -1.52 -2.68 -2.56 29.71

Source: Reuters

Technical Chart - Chana NCDEX Oct contract

Source: Telequote

Technical Outlook valid for Aug 01, 2012

Contract Unit Support Resistance

Chana Sept Futures Rs./qtl 4665-4700 4780-4805

Chana NCDEX Chana September futures corrected sharply yesterday on reports of improving sowing figures released by the Ministry of Agriculture. Improved rains may also increase prospects for next year’s output. The Spot as well as the Futures settled 0.83% and 1.52% lower on Friday.

Although Monsoon has recovered in the month of August in Northwest and Central India that may prove beneficial for the chana sowing, the overall fundamentals still remain supportive for the prices on account of supply tightness amid festive season demand.

The Cabinet Committee on Economic Affairs approved the Minimum Support Prices (MSP) for Arhar (Tur) and Moong for 2012-13 season. The MSP for Arhar has been fixed at Rs.3850 per quintal and of Moong at Rs.4400 per quintal marking an increase of Rs.650 per quintal and Rs.900 per quintal respectively.

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 97.7 Lakh hectare area has been planted under Kharif pulses as on 31st August, 2012 compared to 104.18 lakh hectare (ha) same period last year. Sowing is reported lower mainly in Rajasthan.

Rajasthan Agriculture Department states that, planted area under Kharif Pulses is down at 15.33 lakh hectares ha compared to 24.14 lakh ha same period last year. (Dated 17th August, 2012). Sowing which was down by more than 55% has gained momentum after improvement in rainfall in the last one week and is now down by 35%.

In Maharashtra, Kharif Pulses sowing is down by 7% at 18.63 lakh hectares. While in AP it is up by 5% at 6.98 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.

Assocham estimates, 21 mn tn of pulses demand in 2012-13 and is likely to reach at 21.42 mn tn in 2013-14 and 21.91 MT in 2014-15. (Source: Agriwatch)

India's consumption of pulses is on the rise, while the growth in output in not consistent amid vagaries of weather, which may lead to increase in imports this year. However, rupee weakness may turn import costlier.

Outlook

Chana prices may trade sideways. Prices may correct on reports of improved sowing and rainfall. However, emergence of fresh demand may provide support at lower price levels.

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 3800 1.71 2.70 -3.06 28.81

Sugar M- NCDEX Sept '12 Futures Rs/qtl 3535 0.65 2.97 -2.43 30.20

Source: Reuters

International Prices as on Aug 31, 2012

% Change Unit Last Prev day WoW MoM YoY

Sugar No 5- Liffe- Oct'12 Futures

$/tonne 566.4 1.31 3.53 -8.17 -24.56

Sugar No 11-ICE Oct '12 Futures

$/tonne 439.56 0.15 0.97 -12.63 #N/A

Source: Reuters

Technical Chart - Sugar NCDEX Oct contract

Source: Telequote



Sugar Sept NCDEX Futures Rs./qtl 3572-3602 3665-3700

Sugar Sugar spot as well as the Futures settled 1.71% and 0.65% higher on Friday amid various factors that include emergence of festive season demand, Poor rains, and concerns over Sugar output in Maharashtra amid divergence of cane towards fodder etc.

With chances of El Nino weather pattern receding, the Agriculture Ministry hopes that rainfall in September would be better than earlier forecast.

Apart from the 45 lakh tonnes quota released during the start of the quarter Jul-Sept, government released additional 2.66 lac tn to be sold off by 31st August. Sugar mills have been directed to sell at least 70% of July-September quota (45 lakh tonnes) by August. Another additional quota of 4 lac tn has also been released on 7th August, 2012 to be sold off by 31stAugust. The quota is sufficient to meet the festive season demand and thus helped contain prices.

In the international markets Liffe Sugar as well as ICE sugar settled 1.31% and 0.15% higher on Friday.

Domestic Production and Exports

The area under sugarcane is estimated at 52.88 lakh ha for 2012-13 crop season, up from 50.63 lakh ha on same period a year ago.

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

Industry body ISMA has estimated 7 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may exports 2.5-3 mn tn sugar in 2012-13. India will likely produce 25 million tonne of sugar in 2012-13 factoring in dry spells in biggest producer Maharashtra as well as Karnataka.

With the opening stocks of 7 mn tn, domestic Sugar supplies are estimated at 32mn tn against the domestic consumption of around 22.5-23 mln tn for 2012-13. Thus, no curbs on exports are seen as of now.

Global Sugar Updates

Brazilian cane mills produced 3 mn tn of sugar in the first half of August thanks to dry weather. Unica in its latest report stated said that total sugar output since the start of the crushing season is still down 12 percent from the same period a year ago.

Brazil exported 2.489 million tons of sugar, raw value, up from 1.692 million tons in June but lower from 3.06 million tons sugar exported last year same period.

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 are expected to trade sideways on account of mixed views over next years output. Although sufficient supplies may keep the upside capped, sharp downside will also be restricted amid emergence of fresh demand at lower levels amid festive season ahead.






% Change


Soybean Spot- NCDEX (Indore)

Rs/qtl 4529 -0.22 -1.07 1.25 99.60

Soybean- NCDEX Oct '12 Futures

Rs/qtl 3948 -1.94 -1.96 -12.35 76.35

Ref Soy oil Spot- NCDEX(Indore)

Rs/10 kgs 789 -0.24 -0.48 0.93 19.24

Ref Soyoil- NCDEX Aug '12 Futures

Rs/10 kgs 791.2 -0.80 -2.13 0.64 22.11

Source: Reuters

as on Aug 31, 2012

International Prices Unit Last Prev day WoW MoM YoY

Soybean- CBOT- Sept'12 Futures

USc/ Bushel 1764.50 -0.32 1.55 2.53 27.91

Soybean Oil - CBOT- Sept '12 Futures

USc/lbs 56.42 -0.30 0.32 7.36 -1.54

Source: Reuters

Crude Palm Oil as on Aug 31, 2012 % Change

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

MYR/Tonne 2920 0.17 -3.22 0.65 -14.12

CPO-MCX- Aug '12 Futures

Rs/10 kg 551.3 -0.18 -2.23 -2.73 9.30

Source: Reuters

RM Seed as on Aug 31, 2012


RM Seed Spot- NCDEX (Jaipur)

Rs/100 kgs 4340 0.23 2.05 -0.34 47.62

RM Seed- NCDEX Sept '12 Futures

Rs/100 kgs 4384 -1.62 -1.95 -0.93 48.31

Source: Reuters

Technical Chart –Soybean NCDEX Oct contract

Source: Telequote



Soy Oil Sept NCDEX Futures Rs./qtl 787-791 799-803

Soybean NCDEX Oct Futures Rs./qtl 3880-3910 3970-3995

RM Seed NCDEX Sept Futures Rs./qtl 4395-4422 4475-4502

CPO MCX Sept Futures Rs./qtl 549-553 559-561

Oilseeds

Soybean: Soybean futures closed 1.94% down on Friday owing to improved rains and higher acreage in the key states.

CBOT Soybean settled marginally lower by 0.32% on Friday due to profit booking. According to the newsletter, Pro farmer, Soybean production was seen at 2.60 bn bushels on a yield of 34.8 bushels/ acre, lower compared to the USDAs soybean output estimates of 2.692 billion bushels and yield at 36.1 bushels/ acre.

Brazil’s grain Association expects the number 2 producers of soybean to produce record 81.3 mn tn in 2012-13. Planting in Brazil would commence from Sept. 15 & exports may soar to 37.5 mn tn, beating the 33.8-mn tn record in 2010/11 crop.

According to weekly crop progress report, the condition of U.S soybeans declined to 30% during last week from 31% in good to excellent condition due to weather concerns in the US Midwest. USDA released its monthly crop report on 10th August wherein its cut U.S. 2012/13 soybean production forecast to 2.692 billion bushels, from 3.05 billion in July. India's oil meal exports fell to 2.75 lakh tn in July from 2.82 lakh tn a year earlier led by a sharp drop in the overseas sales of rapeseed meal. Soy meal exports rose to 1.68 lakh tn in July, from 1.39 tn a year ago.

In the domestic markets, as on 24th August Oilseeds have been sown in 164.29 lakh hectares so far, compared with 169.94 lakh hectares same period last year. Soybean area is higher at 106.4 lakh hectares. In 2011-12 season, soybean was sown under 102.9 lakh hectares area and recorded 12.28 million tonne output, down from 12.73 mn tn in 2010-11 season. Refined Soy Oil: NCDEX Soy Oil settled lower by 0.80% taking cues from the oilseeds complex. MCX CPO closed marginally lower due to reports of increase in exports in Malaysia, which provided support to the prices from falling sharply. As per Intertek Testing Services, Malaysian palm oil product exports during Aug 1-25 rose 5.7 percent to 1,084,343 compared to 1,026,153 tonnes shipped in July 1-25.

India imported 112,611 tonnes of refined palm oil in July, down 9.28 percent from June. Total vegetable oil imports in July were 870,328 tonnes, up from 783,315 tonnes in the previous month (Source: Sea of India).

Although, Malaysia's July palm oil stocks rose 17.6 percent to 1,998,870 tn from a revised 1,699,117 tn in June, the export demand is expected to regain momentum amid supply shortage of edible oil globally. Indonesia, the world's top palm oil producer, has lowered its earlier output forecast by 8 percent to 23.6 million tonnes this year.

Rape/mustard Seed: Mustard seed futures settled lower by 1.62% on improved taking cues from the oilseed complex. Mustard output was lower in 2011-12 season. However, with higher returns and improved rains, next years output is expected to be better. 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 may trade sideways as higher international prices and good export demand for soy meal may support prices at lower levels, while, good rains in Madhya Pradesh and other parts of India may also lead to a downside movement in the prices in the coming days.






% Change


Pepper Spot- NCDEX (Kochi)

Rs/qtl 41000 0.49 0.48 -4.37 16.35

Pepper- NCDEX Sept '12 Futures

Rs/qtl 41315 -0.53 -0.08 -5.41 11.96

Source: Reuters

Technical Chart – Black Pepper NCDEX Oct contract

Source: Telequote



Black Pepper NCDEX Sept Futures Rs/qtl 42000-42320 42950-43250

Black Pepper Pepper Futures opened on a flat to positive note but corrected later due to lack of demand in the domestic markets. However, the spot traded on a positive note due to low stocks. Farmers are also unwilling to sell their stocks at lower levels. Lower demand for Indian pepper in the international markets due to huge price parity has also capped any sharp upside. Good supplies from Indonesia have also pressurized the prices. The Spot settled 0.49% higher while the Futures settled 0.53% lower on Friday. 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 $8,000-8,400/tonne(C&F) while Indonesia Austa is quoted at $6300-6400/tonne (FOB). 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 at around 1,25,000 tonnes. Exports of Pepper from Vietnam during January till June 2012 is estimated around 73000 mt 73,000 mt, higher by 4.3% in volume and 31.7% in value compared to corresponding year last year. 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 There arrivals in the spot market were reported at 15 tonnes while offtakes were 15 tonnes on Friday. 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: Pepper trade board) 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 are expected to trade sideways today. Lack of supplies may support prices at lower levels. However, prices may correct due to lower demand at higher levels in the domestic as well as international markets.






% Change


Jeera Spot- NCDEX(Unjha)

Rs/qtl 15606 0.12 -2.92 -5.87 0.04

Jeera- NCDEX Sept '12 Futures

Rs/qtl 14485 -3.37 -6.73 -12.38 -8.12

Source: Reuters

Technical Chart – Jeera NCDEX Oct contract

Source: Telequote

Market Highlights as on Aug 31, 2012 % Change


Turmeric Spot- NCDEX (N'zmbad)

Rs/qtl 5574 -0.51 2.90 5.20 5.69

Turmeric- NCDEX Sept '12 Futures

Rs/qtl 6080 -1.04 4.04 1.50 31.89

Technical Chart – Turmeric NCDEX Oct contract

Source: Telequote


Unit Support Resistance

Jeera NCDEX Sept Futures Rs/qtl 14400-14625 15050-15240

Turmeric NCDEX Sept Futures Rs/qtl 5980-6040 6174-6240

Jeera Jeera Futures corrected sharply yesterday after a sharp recovery in the previous session due to good rains in Gujarat. However, spot remained positive due to reports of fresh export enquiries after Syria and Turkey have completely stopped their shipments. Export enquiries have been report from Bangladesh and EU nations. Good rains are expected to improve moisture levels which may increase prospects of better yield next season. Supply concerns from Syria and Turkey still exists. The Spot settled 0.12% higher while Futures settled 3.37% lower on Friday. Expectations are that export orders may still be diverted to India from the international markets due to the ongoing civil war in Syria which is hampering supplies. There are reports that there has been an increase in demand from Bangladesh for Indian Jeera. Production in Syria and Turkey is being reported around 17,000 tonnes and around 4,000-5,000 tonnes, lesser than expectations. Jeera prices in the international market of Indian origin are being offered at $28,000-2,850 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 3,000 bags, while off-takes stood at 3,000 bags on Thusday. 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 trade sideways. Prices may recover due to expectation of revival in export demand. However, good rains in Gujarat may correct the prices. In the medium to long term (Aug-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 corrected yesterday due to reports of improved arrivals in the Erode mandi. Export demand is lower as orders from Pakistan have been met. Rainfall in Nizamabad is 27% lower than the normal as on 29/8/2012. Turmeric has been sown in 0.53 lakh hectares in A.P as on 29th August 2012. Sowing is also reported 30-35% lower during the sowing period. The Spot as well as the Futures settled 0.51% and 1.04% lower on Friday. 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 2,500 bags and 1,500 bags respectively on Friday. 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 sideways taking cues from lower sowing figures as well as reports of export demand from Pakistan. Traders also expect fresh export orders in the coming days. However, improving weather conditions may cap sharp gains. In the medium term (Aug to September) prices may take cues from the sowing figures.






% Change


Mentha Oil- MCX Spot (Chandausi)

Rs/qtl 1538 0.48 1.03 0.70 13.70

Mentha Oil MCX – Aug Futures

Rs/qtl 1331 -1.11 0.64 -4.96 -1.65

Source: Reuters

Technical Chart – Mentha Oil MCX Sep contract

Source: Telequote

Market Highlights as on Aug 31, 2012 % Change


Potato Spot- NCDEX (Agra)

Rs/qtl 1129 -0.89 -1.78 -4.64 177.28

Potato- NCDEX Sept '12 Futures

Rs/qtl 1105 1.54 -2.69 -8.39 97.04

Technical Chart – Potato NCDEX Sept contract

Source: Telequote


Unit Support Resistance

Mentha Oil Aug Futures Rs/kg 1324-1335 1366-1380

Potato NCDEX Sept Futures Rs/qtl 1080-1095 1122-1135

Potato MCX Sept Futures Rs/qtl 1133-1142 1165-1173

Mentha Oil Mentha oil Futures corrected yesterday on profit booking after the prices rose sharply on Thursday. However the spot remained positive due buying by stockists at lower levels. The spot settled 0.48% lower while the Futures settled 1.11% lower on Friday. 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 around 50,000 tonnes.

Arrivals of the fresh crop are going on in the mandis and currently stand around 500 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 in the intraday. Buying at lower levels may emerge from stockists anticipating good demand from pharmaceutical companies in the coming days. However, lower demand due to ban on Gutkha and Pan Masala may cap any sharp upside. In long to medium term (July-September) prices are likely to remain under pressure due to peak arrival period.

Potato In intraday potato futures on Friday closed up by 1.54% ahead of profit booking by market participants. Commodity market regulator FMC has banned launch of new Tarkeshwar potato contracts. Also From 01-08-2012 no fresh positions shall be allowed during the Staggered Delivery period in all running contracts of Potato in MCX and NCDEX. Only squaring off of existing positions will be allowed during the Staggered Delivery period.

Production and Arrivals Scenario Around 200-220 lakh 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 are expected to trade sideways owing to weak demand. Also West Bengal government has decided to curb its decision to restrict inter-state transfer of potato after October that might provide resistance to the prices in short term. However, the upcoming festive season might provide support to the prices from falling sharply in Medium term.

daily agri report sep 1 -...

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