Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities

Content
News & Market Highlights Chana Sugar Oilseed Complex Spices Complex Kapas/Cotton

Research Team
Vedika Narvekar - Sr. Research Analyst vedika.narveker@angelbroking.com (022) 2921 2000 Extn. 6130 Anuj Choudhary - Research Associate anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132

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Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities
News in brief
India, Iran again fail to strike wheat export deal-sources - RTRS A
delegation of Indian government officials to sanctions-hit Iran could not strike a deal to export wheat to the Islamic Republic which now needs to inform New Delhi about its willingness to buy the grain, sources said on Wednesday. India and Iran have been in talks for almost a year to clinch a deal on wheat and quantities of 2-3 million tonnes are under discussion, but quality issues have hampered negotiations. A deal would help ease a trade imbalance between New Delhi and one of its biggest oil suppliers as they seek ways to pay for the crude in the face of western sanctions aimed at curbing Tehran's nuclear programme. The Indian government sent a delegation to Iran, which returned last night, to clinch a deal to help partly meet payments for Iranian oil and fix an imbalance in trade in favour of Tehran. "There were extensive discussions but there was no final deal. Now the ball is in Iran's court and they need to inform us when they make their mind up. We can sell 2-3 million tonnes to them," one of the sources said. (Source: Reuters)

Market Highlights (% change)

Last Prev. day

as on Oct 10, 2012

WoW MoM YoY

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

18631 5652 53.01 91.25 1763

-0.86 -0.92 0.63 -1.23 0.01

-1.26 -1.38 1.49 3.53 -0.79

7.41 7.90 -4.76 -4.48 3.56

17.98 18.96 7.44 14.52 7.49

Source: Reuters

Malaysia OKs plan to cut crude palm oil export tax-govt official
Malaysia has approved a plan to cut crude palm oil (CPO) export taxes from 23 percent per tonne, a government official said on Thursday, as the world's No.2 producer tries to grab market share from top producer Indonesia. Malaysia's cabinet will discuss the size of the cut in CPO export taxes on Friday, the commodities ministry official said. Commodities Minister Bernard Dompok has proposed for duties to be cut to 8-10 percent. The cut may boost Malaysia's crude palm oil exports and give short-term support to prices that have lost 22 percent so far this year as a slowdown in shipments has led to a rise in inventories. Malaysia's palm oil stocks hit a record of nearly 2.5 million tonnes last month as output reached an all time high and export growth slowed considerably, piling pressure on the government to act to prop up prices. Slower Malaysian exports were due mostly to competing Indonesian processors offering cheaper refined palm oil cargoes after Jakarta cut its own export taxes for processed grade last year to boost margins and lure investment. (Source: Reuters)

Exports, OMSS for bulk buyers take load off FCI grain storage
All thanks to rise in exports and Open Market Sale Scheme (OMSS) for bulk buyers, the acute grain storage crisis faced by the government a few months ago is beginning to ease out. According to latest data available with Food Corporation of India (FCI), grain stocks, essentially consisting of rice and wheat, have declined to a manageable 66.5 million tonne at the start of this month from a peak of 82 mt in June. At present, the government has a stock of 23.3 mt of rice and 43 mt of wheat, which is far above the requirement for strategic reserve and buffer stocks norms of 21 mt. The FCI and state government-owned agencies have storage capacities of around 61 million tonnes that includes 18 million tonnes of CAP (cover and plinth) capacity that cant keep grain intact for more than a few weeks. Decline in grain stocks has been attributed to about three million tonne of wheat exports and an equal amount uploaded under the Open Market Sale Scheme (OMSS) to bulk buyers. Besides, a monthly allocation of about 4 million tonne of grain is done under the Targeted Public Distribution System (TPDS). (Source: Indian Express)

Wind patterns begin to align for North-East monsoon

Meteorological features have started to align themselves to a pattern over peninsular India to set the platform for North-East (reverse) monsoon. An offending circulation with a stubborn presence over Maharashtra has since weakened and disappeared into the vastness of the Arabian Sea. Thundershowers have been forecast also along the east coast. This is likely expected to bring in North-East monsoon, as per early forecasts. Meanwhile, minimum temperatures continued to be below to appreciable below normal at a few places over east Madhya Pradesh, Andhra Pradesh and Gujarat and at one or two places over Rajasthan, Maharashtra, west Uttar Pradesh, Haryana, Punjab, Chhattisgarh and Odisha. The lowest minimum of 15.7 deg Celsius was recorded at Narnaul in Haryana. (Source: Business lIne)

Cooking-Oil Imports by India Set to Climb as Palm Oil Slumps

Cooking-oil imports by India, the worlds largest consumer after China, probably jumped for a second month in September as the biggest monthly slump in palm oil prices in four years spurred demand from refiners. Purchases rose 4 percent to 950,000 metric tons last month from 912,341 tons a year earlier, according to the median estimate in a Bloomberg survey of five processors and brokers. Imports of crude and refined palm oils increased 8 percent to 750,000 tons from 692,200 tons, the survey showed. The Solvent Extractors Association of India will publish data on Oct. 15. Palm oil has slumped 19 percent since the end of August as stockpiles climbed to record levels in Indonesia and Malaysia, the biggest producers, and a global economic slowdown pared demand from China to Europe. Rising Indian imports may help trim inventories in Asia amid a seasonal increase in production. (Source: Bloomberg)

Revival of guar contracts to figure at futures market advisory panel meet

The advisory committee on futures market formed to ideate with the government and the Forward Markets Commission (FMC) is to hold its first meeting in Mumbai on October 16. The panel intents to deliberate on ways to reduce the instances of contracts being settled in cash in the intent match contracts. The three types of settlement done in the commodity futures market are buyer and seller options and intent match option. Ramesh Abhishek, FMC Chairman, told Business Line that there are about 48 contracts which have the option of intent matching where the settlement is done mostly in cash. We do not want investors to use this option as a smoke screen to promote cash settlement. Our intention is to settle all contracts in physical delivery of the commodity, he said. The panel will also express its views on the measures to promote illiquid contracts. On earlier occasions, the regulator had instructed commodity exchanges to promote liquidity in these contracts by taking special interest in the case. (Source: Business Line)

Seeking higher price, AP growers threaten to cut sugarcane area

Sugarcane farmers in Andhra Pradesh have demanded the Government to declare a support price of Rs 3,500 a tonne against the Rs 1,700 price presently paid to the farmers. They said that they have decided to stop cane farming, till governments and factories ensure remunerative prices. To start with, members of the Federation of Sugar Cane Growers Associations will reduce the area under cane cultivation. The cost of production has gone up enormously. The recent increase in diesel price would increase the cost of production by at least Rs 5,000 an acre. As it is, the cost of production had gone up to Rs 1.30 lakh an acre. The yields are not crossing the 30-tonne mark, members of the Federation of Sugarcane Growers Associations (Andhra Pradesh), said.
(Source: Business Line)

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Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities
Chana
Chana prices on Wednesday traded on a positive note and closed up by 1.48% ahead of tight supplies. Also sentiments have turned positive in the past one week on account of improved festive season demand at lower price levels. Prices had declined in the month September on improved rains and reports of expected higher output in Australia, the largest supplier of chickpeas to India. In Australia, chana production rose by 70.5 percent to 8.27 lakh tonnes from 4.85 lakh tonnes in previous year. CACP has recommended a hike in minimum support price (MSP) of gram by Rs.200 to Rs.3000 a quintal and Masoor by Rs.100 to Rs.2900 a quintal for upcoming 212-13 Rabi season to boost the production of pulses. As per the statement of Finance Minister P. Chidambaram, India has raised the subsidy on imported pulses to Rs. 20/kg from the earlier Rs. 10/kg, this move is expected to increase pulses imports. As per the NCDEX circular dated 1 October, Special Margin of 10% (in cash) on the Long Side on all the running contracts and yet to be launched contracts in Chana have been withdrawn with effect from beginning of day Thursday, October 04, 2012. Good rains in the month of August and September has raise prospects of Rabi pulses sowing in the coming days that would commence soon. Monsoon has recovered across India, especially in Rajasthan, one of the major chana growing states, and may prove beneficial for the chana sowing.
st

Market Highlights
Unit Rs/qtl Rs/qtl Last 4490 4662 Prev day 0.40 1.48

as on Oct 10, 2012 % change WoW MoM 2.74 -3.02 4.46 3.16 YoY 27.22 36.00

Chana Spot - NCDEX (Delhi) Chana- NCDEX Oct '12 Futures

Source: Reuters

Technical Chart - Chana

NCDEX Nov contract

Source: Telequote

Sowing progress and demand supply fundamentals

According to the Ministry of Agriculture 99.81 Lakh hectare area has been planted under Kharif pulses as on 21th September, 2012 compared to 108.28 lakh hectare (ha) same period last year. According to the first advance estimates of 2012-13 season, kharif pulses output is estimated lower by 14.6% at 5.26 million tonnes compared with 6.16 mn tn last year. Kharif pulses harvesting would commence from next month. According to the Fourth advance estimates of 2011-12 season, 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. 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)

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

valid for Oct 11, 2012 Resistance 4460-4515

4315-4360

Outlook
Chana futures are expected to gain further ahead of festive season demand and tight supplies. However, reports of higher sowing of Rabi pulses this season might pressurize the prices in the medium term. Also, higher imports from Australia may cap the sharp upside in the prices.

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Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities
Sugar
Sugar Futures on Wednesday underwent gains ahead of festive season demand along with reports of fall in sugar Output in 2012-13 season, as per Farm Minister Sharad Pawars recent statement. The Government has decided to make available a quantity of 40 lakh tons of non-levy quota, for the months of October and November 2012. Indian mills have signed deals to buy up to 450,000 tonnes of Brazilian raw sugar for delivery from October to December as a gap between domestic and overseas prices widens, making room for the first imports in more than two years, five dealers told Reuters. Millers based in western and southern India and global trading firms bought sugar at around $500/ton a CIF basis, as the price in the domestic market has jumped more than 23% to $680/ tn in the past three months. ICE raw sugar and Liffe white sugar futures traded lower and settled 1.32% and 0.98% lower respectively on Wednesday on reports of higher output and lower imports expectations for the 2012-13 season from China.

Market Highlights
Unit Sugar Spot- NCDEX (Kolkata) Sugar M- NCDEX Oct '12 Futures Rs/qtl Last 3714

as on Oct 10, 2012 % Change Prev. day WoW -1.47 -1.74 MoM 0.87 YoY 21.39

Rs/qtl

3390

0.80

-2.31

-1.99

23.27

Source: Reuters

International Prices
Unit Sugar No 5- LiffeOct'12 Futures Sugar No 11-ICE Oct '12 Futures $/tonne $/tonne Last 590.4 472.44

as on Oct 10, 2012 % Change Prev day WoW -1.32 -0.98 -1.27 -1.57 MoM 5.73 9.42 YoY -13.70 #N/A

Domestic Production and Exports

The area under sugarcane is estimated at 52.88 lakh ha for 2012-13 crop season, up from 50.99 lakh ha on same period a year ago. According to the first advance estimates by agriculture ministry, Sugarcane output is pegged at 335.3 mn tn, down by 6.2% compared to 357.6 mn tn last year. Despite of higher acreage, the producers body has estimated next years sugar output lower at 24 mn tn, down by 2mn tn compared to the current year. Sugar production in India the worlds second-biggest producer touched 26 million tonne since October 1, 2011. Industry body ISMA has estimated 6 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may export 2.5-3 mn tn sugar in 2012-13. With the opening stocks of 6 mn tn, domestic Sugar supplies are estimated at 30mn tn against the domestic consumption of around 22.523 mln tn for 2012-13. Thus, no curbs on exports are seen as of now.

Source: Reuters

Technical Chart - Sugar

NCDEX Nov contract

Source: Telequote

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. The International Sugar Organization said it expected a global sugar surplus of 5.86 million tonnes in the season running from October 2012 to September 2013, up from the prior season's surplus of 5.19 million tonnes. The ISO said the stocks/consumption ratio could rise to around 40 percent in 2012/13, from 37.6 percent in 2011/12. (Source: Reuters)

Technical Outlook
Contract Sugar Oct NCDEX Futures Unit Rs./qtl

valid for Oct 11, 2012 Support 3290-3308 Resistance 3343-3365

Outlook
Sugar prices may trade sideways as festive demand might support the upside in the prices, while higher Quota for the month of October and November may cap sharp gains.

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Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities
Oilseeds
Soybean: Soybean Futures as well as spot extended the gains,
demand for edible oil ahead of ongoing festive season supported the upside. The Futures settled 0.36% higher while the spot closed up by 2.20%. As per NCDEX, Special Margin of 20% (in cash) on the Long Side on Soya bean October 2012 expiry contract will be withdrawn with effect from beginning of day Monday, October 08, 2012. Special margin on soy meal has also been withdrawn w.e.f October 12 2012. CBOT Soybean settled 1.73% lower on Wednesday ahead of USDA monthly reports that are expected to show an increase in yield forecasts and a continuation of the recent record pace of harvest. US soybeans are 41 pct harvested v/s 22 pct week ago and 19 pct to nd 5-year average as on 2 October 2012. In Brazil planting has started 10 days earlier amid good rains. If rains continue in the coming weeks as forecast, Brazil could churn out 81 million tonnes of oilseed and replace the drought-stricken US as the world's top soybean producer, according to the USDA. Brazils grain Association expects the number 2 producers of soybean to produce record 81.3 mn tn in 2012-13. In the domestic markets, as on 20 September, 2012, Oilseeds have been sown in 174.39 lakh ha so far, compared with 178.16 lakh ha same period last year. Soybean area is higher at 106.9 lakh ha. According to first advance estimates, Soybean output is pegged at at 126.2 lk tn for 2012-13. However, drop in area under groundnut, sunflower & castor seed may lead to lower output of these oilseeds in 2012-13 which is estimated 9.6% lower at 187.8 lakh tn.
th

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Oct '12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Oct'12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3202 3220 669.6 657 Prev day 2.20 0.36 1.70 0.41

as on Oct 10, 2012 % Change WoW 12.04 9.12 2.69 6.82 MoM -29.02 -16.44 -16.09 -17.78
Source: Reuters

YoY 47.02 47.81 5.47 6.27

as on Oct 10, 2012 International Prices Soybean- CBOTNov'12 Futures Soybean Oil - CBOTOct '12 Futures Unit USc/ Bushel USc/lbs Last 1523 50.17 Prev day -1.73 -1.28 WoW -0.55 -0.32 MoM -13.99 -12.85 YoY 10.42 -12.44

Source: Reuters

Crude Palm Oil

as on Oct 10, 2012 % Change Prev day WoW 0.04 -0.12 4.40 2.60

Unit
CPO-Bursa Malaysia Oct '12 Contract CPO-MCX- Oct '12 Futures

Last 2279 418

MoM -18.87 -21.99

YoY -32.97 -12.11

MYR/Tonne Rs/10 kg

Refined Soy Oil: Ref soy oil settled marginally higher due to festive
demand in India, while MCX CPO settled lower taking cues from the international palm oil prices. According Malaysian Palm Oil Board, the ending stocks for palm oil increased by 17.24% for Septmber. Although, exports are high the overall stocks of Malaysian palm oil are higher on the back of seasonally higher yield. Exports of Malaysian palm oil products for Sept. 1-25 rose 8 percent to 1,170,720 tonnes from 1,084,343 tonnes shipped during Aug. 1-25. Indias edible oil imports should rise 5.4 percent to a record 10.31 million tonnes in 2012/13, with the entire increase met by palm oil. India imported 112,611 tn of refined palm oil in July, down 9.28 percent from June. Total vegetable oil imports in July were 870,328 tn, up from 783,315 tn in the previous month (Source: Sea of India).

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Oct '12 Futures Rs/100 kgs Rs/100 kgs Last 4250 4067 Prev day 2.41 -0.95

as on Oct 10, 2012 WoW 6.92 9.56 MoM 0.59 -0.37

Source: Reuters

YoY 42.14 33.00

Technical Chart Soybean

NCDEX Nov contract

Rape/mustard Seed: Mustard futures settled down by 0.95% on

account of profit booking while spot closed 2.41% higher owing to supply tightness. Mustard output was lower in 2011-12. However, on the back of higher returns and improved rains, next years output is expected to be better. Sowing of rapeseed starts from October and northwestern Rajasthan is the top producing area in the country. As per NCDEX circular, existing Special Margin of 15% (in cash) on the Long side shall be reduced to 5% (in cash) on all the running contracts and yet to be launched contracts in Rapeseed Mustard Seed with effect from Monday, September 24, 2012. Outlook Edible oil complex is expected to trade sideways with a upper bias taking cues from the firm Malaysian pal oil futures. Also withdrawal of special margin in October soybean contract might provide support to the prices. However due to good quantity new crop arrivals of soybean hitting the market, sharp upside might be capped for short term.

Source: Telequote

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

valid for Oct 11, 2012 Support 629-636 3130-3170 4075-4110 409-413.50 Resistance 648-654 3262-3295 4190-4230 424-429

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Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities
Black Pepper
Pepper futures continued to trade on a positive note for the third consecutive session yesterday due to low supplies in the domestic markets as well as festive demand. Farmers are also unwilling to sell their stocks at lower levels. However, expectations of improvement in weather conditions as well as better output in Indonesia have capped sharp gains. Traders are buying pepper directly from the farmers. Exports demand for Indian pepper in the international markets remains weak due to huge price parity. The Spot as well as the Futures settled 0.95% and 0.5% higher on Wednesday. th According to the circular released on June 13 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 $8,600/tonne(C&F) while Indonesia Austa is quoted at $6,750/tonne (FOB). Vietnam was offering 550GL at $6,900/tonne. 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).

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Oct '12 Futures Rs/qtl Rs/qtl Last 42529 43905 % Change Prev day 0.95 0.50

as on Oct 10, 2012 WoW 0.90 1.13 MoM 2.77 4.11 YoY 23.04 28.06

Source: Reuters

Technical Chart Black Pepper

NCDEX Nov contract

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.

Source: Telequote

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

valid for Oct 11, 2012 Support 43150-43380 Resistance 43900-44250

Production and Arrivals

The arrivals in the spot market were reported at 28 tonnes while offtakes were 30 tonnes on Wednesday. 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 is expected to continue to trade on a positive note today. Low supplies in the domestic markets as well as festive season demand are expected to support prices. However, reports that FMC has asked NCDEX to find out any irregularities in pepper trade may cap sharp upside.

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Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities
Jeera
Jeera prices traded on a positive note yesterday on reports of export enquiries. Farmers are unwilling to sell at lower prices. Expectations of better export figures have also supported the prices at lower levels. However, reports of higher carryover stocks as compared to last year restricted sharp gains. Good rains in Gujarat, thereby expectations of better sowing prospects ahead of the rabi sowing have also pressurized the prices in the spot market. The spot settled 0.01% lower while the Futures settled 1.3% higher on Wednesday. According to markets sources about 75% exports target has already been achieved due to a supply crunch in the global markets. Around 10 lakh bags of Jeera are reported across India. Supply concerns from Syria and Turkey still exists. Expectations are that export orders may still be diverted to India from the international markets due to lack of supplies from Syria on back of the ongoing civil war. Production in Syria and Turkey is being reported around 17,000 tonnes and around 4,000-5,000 tonnes, lesser than expectations. Jeera prices of Indian origin are being offered in the international market at $2,650 tn (c&f) while Syria and Turkey are not offering. 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.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Oct'12 Futures Rs/qtl Rs/qtl Last 14701 14430 Prev day -0.01 1.30

as on Oct 10, 2012 % Change WoW 1.76 6.10 MoM -0.33 4.93 YoY -1.11 0.35

Source: Reuters

Technical Chart Jeera

NCDEX Nov contract

Production, Arrivals and Exports

Unjha markets witnessed arrivals of 4,000 bags, while off-takes stood at 4,000 bags on Wednesday. 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%.

Source: Telequote

Market Highlights
Prev day -0.20 0.78

as on Oct 10, 2012 % Change

Outlook
Jeera futures are expected to continue to trade upwards today. Prices may find support at lower levels on expectations of higher export figures. However, good rains in Gujarat and higher carryover stocks may cap any sharp gains. In the medium term (October-November 2012), prices are likely to witness a bounce back as there are limited stocks with Syria and Turkey.
Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Oct '12 Futures

Unit Rs/qtl Rs/qtl

Last 5268 5460

WoW -3.35 -2.15

MoM -6.53 -9.15

YoY -7.27 8.98

Turmeric
Turmeric Futures recovered yesterday on account of short coverings. Stockists are also not buying actively. Higher stocks with the stockists also pressurized the prices. However, a reduction in the special cash margin on the long side supported the prices. Turmeric has been sown in 0.57 lakh hectares in A.P as on 03/10/2012. Sowing is also reported 30-35% lower during the sowing period. The Spot settled 0.2% lower while the Futures settled 0.78% higher on Wenesday. Special Cash Margin of 40% on the Long side shall be reduced to 20% (cash) on all the running contracts and yet to be launched contracts in Turmeric w.e.f. beginning of day Wednesday, September 26, 2012.

Technical Chart Turmeric

NCDEX Nov contract

Production, Arrivals and Exports

Arrivals in Erode and Nizamabad mandi stood at 3,000 bags and 1,000 bags respectively on Wednesday. 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 201011. 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.

Source: Telequote

Technical Outlook
Unit Jeera NCDEX Oct Futures Turmeric NCDEX Oct Futures Rs/qtl Rs/qtl

valid for Oct 11, 2012 Support 14200-14350 5350-5400 Resistance 14680-14820 5480-5520

Outlook
Turmeric prices are expected to trade downwards today on reports that FMC has asked NCDEX to find out any erratic trades in turmeric. Stockists are also not buying actively, which may pressurize prices. However, a reduction in the special cash margin, lower sowing figures and lower arrivals may support prices.

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Commodities Daily Report

Thursday| October 11, 2012

Agricultural Commodities
Kapas
NCDEX Kapas and MCX cotton prices on Wednesday settled down by 2.13% and 1.46% lower ahead of profit booking after witnessing a upward rally in the past few days. Also, ongoing harvesting pressure in the key producing states provided resistance to the prices ICE cotton Futures closed up by 2.28% as investors are awaiting for the Monthly demand supply report of USDA that is going to be issued today . Cotton harvesting has commenced in US, in all 14% is harvested as compared to 10% a week ago, versus 15% same period a year ago. Cotton crop condition is 42% in Good/Excellent state as compared to 43% a week ago, and 29% same period a year ago.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 942 16160

as on Oct 10, 2012 % Change Prev. day WoW -2.13 3.29 -1.46 0.87 MoM -6.64 0.87 YoY -16.31

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 72.1 81.35

as on Oct 10, 2012 % Change Prev day WoW 2.28 2.41 0.00 0.00 MoM -3.84 0.00 YoY -29.01 -29.20

Domestic Production and Consumption

As on 28 September, 2012, Cotton is being planted on 114 lakh hectares, down, as compared to the last years 119.6 lakh hectares. However, the acreage so far is at par with its normal area of 111.8 lakh hectares. According to the First Advance Estimates, Cotton production for 2012-13 seasons is revised upward to 334 lakh bales compared with 352 lakh bales in 2011-12 season. Also, on account of cheaper cotton available in the global markets, imports have more than double from 5 lakh bales to 12 lakh bales. According to the latest CAB report as on 04 October 2012, exports have dipped sharply by 46% to 7 million bales in the 2012/13 marketing year that began on Oct. 1 compared to 12.7 million bales estimated for 201112 season. The ending stocks figure, has been revised further upward to 3.4 million bales as compared to 2.8 million bales estimated for August 2011-12 season
st

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Global Cotton Updates

Global cotton prices are mainly influenced by China, US and India. USDA estimated US Cotton planting for the season 2012-13 at 12.64 mln acres as compared to 14.74 mln acres last season (2011-12). Ending stocks were at 4.8 mln bales (480 pounds/bales) with Production of 17.65 mln bales and exports of 12.1 mln bales were pegged for the season 2012-13. In its September monthly demand supply report on Wednesday, the Agriculture Department (USDA) raised its estimate for the global cotton surplus by next July to a record of 76.5 million 480-pound bales, nearly a two-million bale increase from last month's estimate. China's 2012 cotton output is estimated at 6.97 million tns, down 4.2 percent from last year. China's cotton imports in August rose 48 percent on the year to 305,600 tns. Total imports in the first eight months of the year were 3.77 million tns, up 123% from the same period last year, according to the report by the China National Cotton Reserves Corp.

Source: Telequote

Technical Chart - Cotton

MCX Oct contract

Outlook
Kapas futures in intraday is expected trade rangebound due to ongoing fresh crop arrivals pressure. Prices might also take support at lower levels as farmers are not willing to sell their produce at lower levels. Besides, prices in spot market are nearing its MSP, which would restrict any major fall. In the international front, cotton harvesting has begun globally which might cap a sharp upside in medium term. Also, prices might take cues from the USDA monthly demand supply report that is to be issued today.
Source: Telequote

Technical Outlook
Contract Kapas NCDEX April Kapas MCX April Cotton MCX October Unit Rs/20 kgs Rs/20 kgs Rs/bale

valid for Oct 11, 2012 Support 942-953 937-948 16150-16280 Resistance 975-988 973-982 16620-16860

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