Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities

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

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

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Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities
News in brief
Area under rabi foodgrains trails
Rabi acreage under oilseeds such as rapeseed mustard and groundnut has seen a rise, while the area under wheat sown so far, was marginally lower than last year. Data released by the Agriculture Ministry revealed that wheat sowing, so far, has taken place in an area of 272.79 lk ha, down marginally over corresponding last years 276.81 lk ha. The hike in MSP announced by the Government last week is expected to give a fillip to wheat sowing in the days ahead. The Government has increased the MSP for wheat to Rs 1,350 for the 2012-13 season over last years Rs 1,285. Major wheat growing states such as Madhya Pradesh, Rajasthan, Uttar Pradesh and Bihar have reported an increase in area under wheat. However, the wheat acreage is lower in Maharashtra and Gujarat. The area under oilseeds is up marginally at 78.86 lk ha against 77.88 lk ha. Mustard acreage is up by about 1.2 lk ha at 65lk ha. Groundnut and sunflower have also seen a marginal increase in area. The rice acreage was also lower at 1.87 lk ha against 3.02 lk ha in corresponding period last year. The acreage under coarse cereals such as jowar, bajra and ragi is up marginally, while that the area under pulses is slightly lower than last year. States such as Andhra Pradesh and Karnataka have reported a marginally higher area under coarse cereals such as jowar and ragi. However, Maharashtra has reported a lower area under coarse cereals. Pulses such as gram has seen an increase in acreage while moong and urad have seen a marginal decline in area. (Source: Business Line)

Market Highlights (% change)

Last Prev. day

as on Dec 28, 2012

WoW MoM YoY

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

19445 5908 54.76 90.8 1655

0.63 0.65 -0.32 -0.08 -0.46

-0.05 -0.14 -0.21 0.74 0.61

1.43 1.43 0.07 3.10 -4.19

25.10 27.16 3.31 -8.88 7.47

.Source: Reuters

Diseases force Coffee Board to cut output estimate

The country is likely to see flat coffee production for the crop year 201213 at 3,15,500 tn compared with last year. According to the Coffee Boards post-monsoon estimate, coffee output is pegged at 3,15,500 tn against last year's estimate of 3,14,000 tn. The reasons for reduction in production estimate is attributed to the normal berry drop during the monsoon period and also due to black rot and stalk rot in certain high rainfall areas. The post-monsoon crop forecast for the year 2012-13 is placed at 3,15,500 tn, which shown a reduction of 9,800 tn (-3.01%) over the post-blossom estimate of 2012-13 of 3,25,300 tn. However, it is a marginal increase of 1,500 tn (0.48%) over the final estimate of previous year 2011-12 (3,14,000 tn). (Source: Business Line)

Maharashtra to release Rs 250 crore for drought relief

The Maharashtra Government has decided to release Rs 250 crore for drought mitigation in the State. The funds would be primarily used for providing drinking water in rural areas and paying electricity bill arrears of the farmers. Relief and Rehabilitation Minister Patangrao Kadam said providing drinking water and fodder for the animals was the top priority for the Government. The drought mitigation plan would be implemented in two phases the first phase would be from January to March while the second would be from April to June, he said. (Source: Business Line)

Rice procurement up by 5% so far this marketing season

Rice procurement has increased by 5 per cent to 16.05 mn tn so far in 2012-13 marketing year that started in October, even as rice output is estimated to decline during Kharif season. Food Corporation of India (FCI), the nodal agency for procurement and distribution of foodgrains, had bought 15.36 mn tn of rice in the corresponding period of 2011-12 marketing year, according to an official data. Rice production is estimated to fall at 85.59 mn tn in the Kharif season of 2012-13 crop year (July-June) from 91.53 mn tn. Punjab has contributed maximum to the total procurement where FCI and other state agencies have procured 8.54 mn tn of rice till date in 2012-13 marketing year (OctoberSeptember) against 7.66 mn tn in the year-ago period. Procurement in Haryana has reached 2.57 mn tn till date, whereas Chhattisgarh and Andhra Pradesh have contributed 1.74 mn tn and 1.39 mn tn, respectively. (Source: Business Line)

Rake shortage hits soyameal shipments

Diversion of rakes to move foodgrains such as wheat and rice is hitting soya meal shipments. Poor availability of rakes for exports is delaying our shipments, said Rajesh Agarwal, spokesperson for SOPA, which has made a representation to the Railways seeking additional rakes. The soya processing industry in Madhya Pradesh is getting one or two rakes a day against a requirement of 4-5 rakes a day, Agarwal said. The situation is a little better in Maharashtra, where there is no pressure to ship wheat, Agarwal said. (Source: Business Line)

Myanmar: Pulses Export in October Up by 57%

USDA revealed that Myanmar beans and pulses export is up by 56 per cent to 110498 MT as compared with same period in last year. Out of the total export , 73% (80721 MT) was exported to India followed by Singapore (11316 MT). Moreover, country beans and pulses export by this time totaled at 1.383 MMT as compared to last year total export of 1.358 MMT. (Source: Agriwatch)

Dont hurry on food Bill, cash transfer: Pawar

Union Agriculture Minister and Nationalist Congress Party ( NCP) Supremo Sharad Pawar today advised against being hasty in implementing the food security and Aadhaar- based cash transfer schemes and instead called for a pragmatic approach. Our party has extended its support to the food security Bill and Aadhaar- based cash transfer scheme. But we are of the firm view that these decisions should not taken in a hurry, Pawar told Business Standard (Source: Business Line)

Indonesia Cuts Crude Palm Oil Export Tax

Indonesia cuts its crude palm oil export tax by 1.5% to 7.5% for January. Moreover, Indonesian government also reduce RBD palmolein export tax to 2% for January. Previous month RBD palmolein export tax was 3% Trade Ministry. (Source: Agriwatch)

US lawmakers rush to finish farm bill extension

The U.S. House and Senate agriculture committees are working on a short-term extension to the expired U.S. farm bill, and plan to vote on the extension by Monday, the final day of 2012, lawmakers and aides said. The proposed extension to farm legislation that expired in September could be for six months to a year. If an extension is passed the United States would avoid reverting to 1949 "permanent law" and a potential spike in the retail price of milk to as much as $8 a gallon in 2013. But a year-long extension would probably mean another round of the direct subsidies to farmers that cost about $5 bn a year and that both sides of debate had agreed earlier to eliminate. (Source: Reuters)

India is All Set to become Top Rice Exporter in 2012-13, FAO

As per FAO latest report, India is ready to become the top rice exporter this year with over 9 million tonnes of rice exports, ending Thailands status which is expected to bounce back as the largest rice exporter in 2013 with exports of about 8 million tons, as Indias exportable surplus in the year ending March 2013 is estimated to be around 7.7 million tons. However, FAO estimation for Indias rice production in year 2012-13 may fall by about 4% to around 100 million tonnes compare to 104 million tonnes of rice production in previous year. (Source: Agriwatch)

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Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities
Chana
Chana futures continued its downward trend on Friday on higher acreage expectations and rising imports of Australian Chana. The spot as well as the Futures settled 0.09% and 1.92% lower on Friday. Sentiments have also turned negative on the back of fresh arrivals of new crop from Karnataka and AP. Although the quantity so far received is negligible, but is expected to improve in the coming weeks.

Market Highlights
Unit Rs/qtl Rs/qtl Last 3924 3840 Prev day -0.09 -1.92

as on Dec 28, 2012 % change WoW MoM -5.46 -11.12 -9.90 -10.15 YoY 18.31 17.14

Chana Spot - NCDEX (Delhi) Chana- NCDEX Jan'13 Futures

Sowing progress
Total pulses acreage as on 28 December 2012 stood at 132.52 lakh st hectares, down marginally by 1.2% yoy. As on 21 December, pulses acreage was lower by 0.9 percent. (Source: PIB) Chana sowing is however higher in Rajasthan, where it is up by 4% at 14.57 lakh hectares. In Maharashtra Chana acreage is up at 10 lakh ha as th th on 21 Dec, 2012. While in AP it is up at 6.64 lakh ha as on 19 Dec. (Source: State farm dept)
th

Source: Reuters

Technical Chart - Chana

NCDEX Jan contract

Demand supply fundamentals

Chana fresh crop arrival have started in Karnataka & Andhra Pradesh and about 200 bags new Chana arrivals reported on a daily basis. Furthermore, the new crop was traded at Rs.4100-4200 per quintal. Farm ministry has targeted 7.9 mn tn Chana output for 2012-13 season, higher compared to 7.58 mn tn in 2011-12. 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. The Commission for Agriculture Costs and Prices (CACP) has suggested 10 per cent import duty on pulses to encourage domestic production. in the first six months of the new fiscal that is from April to September this year, imports were an estimated 12 lakh tonnes. 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).

Source: Telequote

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

valid for Dec 29, 2012 Resistance 3880-3900

3760-3805

Trade Scenario
USDA revealed that Myanmar beans and pulses export is up by 56 per cent to 110498 MT as compared with same period in last year. Out of the total export, 73 percent (80721 MT) was exported to India followed by Singapore (11316 MT). (Source: Agriwatch dated Dec 27) In Australia, total chickpea production in 201213 is estimated to have increased to a record of around 746000 tones as compared with 485000 tons in 2011-12. India imports Chana mainly from Australia and Canada and higher availability in these countries at comparatively cheaper rates is seen boosting imports of Chana to meet the domestic shortfall.

Outlook
During the intraday, are expected to trade downwards today as sufficient supplies amid higher shipments and expectations of better output next season may exert downside pressure on Chana prices. Harvesting of new crop have commenced in AP and Karnataka. In Maharashtra arrivals would commence in January and gradually increase February onwards once the arrivals from MP begin.

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Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities
Sugar
Indian sugar futures continued to trade lower and settled 0.31% lower on Friday on account of sufficient supplies in the domestic markets and subdued demand. However, sentiments have turned positive in the past one week anticipating the government would raise duty on imports of the sweetener. The government is planning to remove quantitative restrictions on sugar exports and imports and will use tariffs to regulate trade as part of a new liberalized policy for the sector. With lower sales realization and higher sugarcane payment to farmers, ISMA has already requested government to increase the import duties on raw sugar from current level to the normal rate of 60%, so as to avoid cane price arrears during the season. Government has allocated total 70 lac tons of non-levy sugar quota for Dec-March 2012-13 period which is higher from 59.5 lac tons last year. Raw sugar futures on ICE as well as Liffe white sugar settled 0.08% and 0.15% lower on Friday on account of supply glut in the global markets. According to Unica, Brazil's 2012-2013 center-south sugar output is expected to reach 34.05 million tonnes, an estimate 4.1% higher than its 32.7 million tonnes September forecast.

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Jan'13 Futures Rs/qtl Last 3273

as on Dec 28, 2012 % Change Prev. day WoW 0.04 -1.13 MoM -4.23 YoY 11.39

Rs/qtl

3250

-0.31

1.66

-1.22

12.61

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 522 431.56

as on Dec 28, 2012 % Change Prev day WoW -0.08 -0.15 0.81 0.99 MoM 2.47 1.41 YoY -13.29 -16.65

.Source: Reuters

Technical Chart - Sugar

NCDEX Jan contract

Domestic Production and Exports

Mills in the country have produced 4.91 mln tn sugar in the current sugar season till Dec 15, up nearly 2% from 4.82 mln tn produced a year ago. In Maharashtra, the largest sugar producer in the country, 155 mills are operational and have produced 1.88 mln tn sugar till Dec 15, compared with 1.83 mln produced a year ago by 165 mills. In Uttar Pradesh, the second largest sugar producer in the country, total output as on Dec 15 was 1.03 mln tn, about 20% lower on year, as some mills in the eastern part of the state are still to commence cane crushing. 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. The producers body has estimated sugar output lower at 24 mn tn, down by 2mn tn compared to the current year. Industry body ISMA has estimated 6.5 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may export 1.5 mn tn sugar in 2012-13. With the opening stocks of 6.5 mn tn, domestic Sugar supplies are estimated at 30.5 mn tn against the domestic consumption of around 22. 5mln tn for 2012-13.

Source: Telequote

Technical Outlook
Contract Sugar Jan NCDEX Futures Unit Rs./qtl Support

valid for Dec 29, 2012 Resistance 3265-3280

3225-3238

Global Sugar Updates

According to the Brazil Agriculture Ministry, 2012-13 sugar output will reach 37.66 mn tn by the end of the season, less than the 39 mn tn forecast in August. Consultancy Kingsman revised up its 2012/13 world sugar surplus estimate to 9.2 million tonnes raw value on Friday, citing increased supply from producers including Brazil and China. Kingsman pegged global 2012/13 sugar output at 180.1 million tonnes raw value, up from the previous estimate of 177.3 million tonnes. (Source: Reuters)

Outlook
Sugar prices may trade sideways with downward bias on account of sufficient supplies in both the domestic as well as global markets. However, a sharp downside may by restricted on expectations government may remove quantitative restrictions on sugar import/export.

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Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities
Oilseeds
Soybean: Soybean futures traded on a positive note for the second consecutive day yesterday. The spot as well as the Futures settled 0.49% and 0.53% higher on Friday.
Arrivals in the domestic markets remained at 2.5 lakh bags, while demand is comparatively lower amid subdued overseas demand. According to first advance estimates, Soybean output is pegged at 126.2 lakh tn for 2012-13. Exports of soy meal rose to 517,103 tonnes in Nov from 3.97 lakh tn year ago. Overall oil meal exports in the first eight months of the year beginning April fell to 2.4 mn tn from 3 mn tn a year ago.

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Jan '13 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Jan '13 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3298 3243 711.1 702.8

as on Dec 28, 2012 % Change Prev day 0.49 0.53 0.33 0.41 WoW -0.96 -1.64 -1.13 -2.66 MoM 0.21 -0.49 -4.51 -3.18 YoY 33.68 30.61 -1.28 -2.93

International Markets
Soybean futures on the Chicago Board of Trade fell around 0.4% Thursday on expectations of weak export sales data. Trade expects USDA today to show export sales of U.S. soybeans in the latest reporting week at 100,000 to 300,000 tonnes. Net sales of 619,400 MT for the 2012/2013 marketing year down 53 percent from the previous week and 23 percent from the prior 4week average. Last week, private exporters reported the cancellation of 540,000 tonnes of U.S. soybeans sold to China - the biggest cancellation by the world's top importer of the oilseed in at least 14 years. Brazil's government food supply agency Conab forecast the soybean crop at a record 82.6 million tonnes.

Source: Reuters

as on Dec 28, 2012 International Prices Soybean- CBOTJan'13 Futures Soybean Oil - CBOTJan'13 Futures Unit USc/ Bushel USc/lbs Last 1424 48.94 Prev day 0.37 1.35 WoW 1.08 2.15 MoM -1.74 -2.35
Source: Reuters

YoY 19.92 -4.30

Crude Palm Oil

as on Dec 28, 2012 % Change Prev day WoW 0.72 0.55 7.54 4.18

Unit
CPO-Bursa Malaysia Jan '13 Contract CPO-MCX- Dec '12 Futures

Last 2367 418.6

MoM 8.68 -2.31

YoY -24.13 -22.77

Refined Soy Oil: Malaysian palm oil futures climbed to a five-week

high on Friday on expectations for stronger demand and as monsoon-driven floods in the country's key producing regions sparked concerns of supply disruptions. CPO prices have gained significantly last week as a cut in export duty on Malaysian palm oil is likely to boost exports and reduce palm oil stock piles. Taking cues from the international markets, domestic CPO as well as ref soy oil prices also settled higher by 2.51% and 0.33% respectively on Thursday. Indonesia, the world's top palm oil producer, reduced its export tax on crude palm oil to 7.5 percent for January from 9 percent in December. Exports of Malaysian palm oil products for Dec. 1-20 fell 1.9 percent to 1,004,159 tn from 1,023,517 tn for the Nov. 1-20 period.

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Jan'13 Futures Rs/100 kgs Rs/100 kgs Last 4250 4172 Prev day -0.23 0.51

as on Dec 28, 2012 WoW 0.00 1.26 MoM 1.31 0.85

Source: Reuters

YoY 26.44 17.79

Rape/mustard Seed: Mustard seed futures recovered from lower

levels on Friday. Prices have corrected on higher acreage. The agriculture ministry data showed higher mustard seed planting figures. Acreage in Rajasthan, largest producing state as on 14 Dec 2012 is 2656.6 thousand ha compared to 2441 thousand ha during the same period last year (Mustard has been planted over 63.6 lakh ha so far, 3.3% higher compared with a year ago. rapeseed output is expected to rise by 5% to 6.5 mn tn from 6 mn tn last year.

Technical Chart Soybean

NCDEX Jan contract

Outlook
Soybean complex may recover in the initial part of the session on Friday on account of short coverings. However, prices may again come under downside pressure on account of weak demand. Mustard seed prices trade on a sideways to positive note today as sentiments remain positive amid tight supplies till the fresh crop arrives in February. Palm oil may continue to trade with a positive bias on expectations of supply disruptions in Malaysia caused by monsoon driven floods. Also, export duty cut may reduce Malaysian palm oil stocks.

Source: Telequote

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

valid for Dec 29, 2012 Support 692-696 3190-3220 4120-4145 429-433 Resistance 705-710 3260-3300 4195-4230 441-445

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Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities
Black Pepper
Pepper Futures traded on a negative note yesterday. Prices have corrected as Food Safety and Standards Authority of India sealed the entire quantity of pepper stored in six warehouses in Kerala of about 5,000 tonnes. The six warehouses have also been sealed. Harvesting of the fresh crop has commenced and is expected to gain momentum in the coming days. Winter demand coupled with low stocks in the domestic markets has supported prices at lower levels. However, higher output expectations capped sharp upside. FMC is probing into complaints against movement in the pepper market which has capped a sharp upside. Better output expectations in the domestic as well as the international markets have also pressurized prices over the last couple of weeks.. Exports demand for Indian pepper in the international markets is also weak due to price parity. The Spot settled as well as the Futures settled 0.41% and 0.77% lower on Friday. Pepper prices in the international market are being quoted at $7,200/tn(C&F Europe), while Vietnam was offering Austa at $7,000/tn, Brazil Austa at $6,000-6,500/tn, and Indonesia Austa at $6,500/tn (FOB).

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Feb'13 Futures Rs/qtl Rs/qtl Last 37750 34050 % Change Prev day -0.41 -0.77

as on Dec 28, 2012 WoW -2.49 -13.29 MoM -0.88 -8.65 YoY 13.53 4.35

Source: Reuters

Technical Chart Black Pepper

NCDEX Feb contract

Exports and Imports

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 pepper during Jan-Oct 2012 stood at 102,340 mt, lower by 12% as compared to 1,15,780 mt in the same period last year. Total exports in 2012 are forecasted at around 1,10,000 tonnes. Pepper imports by U.S. the largest consumer of the spice declined 26% during January-September 2012 period to 41,923 tn as compared to 52,489 tn in the same period previous year. 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. Brazil exported 25,900 tn pepper during Jan-Nov 2012, around 20% lower compared with 32,650 tn in the same period last year. Exports from Malaysia 8,300 tn pepper during Jan-Oct 2012, lower by 30% last year while exports in October. stood at 1,077 mt in.

Source: Telequote

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

valid for Dec 29, 2012 Support 33470-33730 Resistance 34410-34850

Production and Arrivals

The arrivals in the spot market were reported at 7 tonnes while off takes were reported at 31 tonnes on Friday. As per IPC, Global pepper production in 2012 is projected at 3.27 lk tn, up compared with 3.18 lk tn in 2011. Production for 2013 is projected at 316832 tn. Indonesian pepper output is expected to rise by 24% and in Vietnam by 10%. According to previous estimates, pepper output in Vietnam is estimated to be 1 lakh tonne in 2012 as compared to 1.1 lakh tonne in 2011. Brazil is also expected to produce 22,000 tn this year. 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) Pepper production in 2012-13 is expected around 60,000-63,000 tonnes. Currently, pepper is in the fruit formation stage in Kerala.

Outlook
Pepper is expected to continue to trade on a negative to bearish note today. Reports that FSSAI has sealed huge quantity of pepper is expected to maintain pressure on the prices. Good arrivals coupled with higher output expectations as well as reports that FMC is probing into complaints against price movement may pressurize prices. However, winter buying may support prices at lower levels.

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Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities
Jeera
Jeera Futures recovered yesterday in the initial part of the day on account of short coverings but corrected towards the end. Improvement in the ongoing sowing coupled with weak domestic demand has pressurised prices. Fresh export enquiries coupled with demand from stockists and masala millers had boosted the prices over the last couple of days. According to Gujarat State Agri Dept. sowing in th Gujarat is reported at 2.635 lakh ha as on 18 Dec, 2012 compared with 2.319 lakh ha last year. In Rajasthan, sowing is expected to increase by 10-15%. Higher stocks for delivery on the exchange warehouse were pressurizing prices during the last one month. The spot as well as the Futures settled 0.39% and 0.35% higher on Friday. According to markets sources about 75% exports target has already been achieved due to a supply crunch in the global markets. 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 $2,775-2,825 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 5-6 lakh bags.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Mar '13 Futures Rs/qtl Rs/qtl Last 14860 14878 Prev day 0.39 0.35

as on Dec 28, 2012 % Change WoW -2.22 -0.87 MoM -0.59 3.14 YoY -2.77 -5.62

Source: Reuters

Technical Chart Jeera

NCDEX March contract

Production, Arrivals and Exports

Arrivals in Unjha were reported at 4,000 tn on Friday. Production of Jeera in 2011-12 is expected around 40 lakh bags as against 29 lakh bags in 2010-11 (55 kgs each). 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 2.89 0.12

as on Dec 28, 2012 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Apr '13 Futures Rs/qtl Rs/qtl

Last 5541 6592

WoW 3.99 22.07

MoM 9.76 29.76

YoY 7.47 37.16

Outlook
Jeera futures are expected to continue to trade lower today. Higher stocks for delivery on the exchange warehouses coupled with higher sowing in Gujarat may pressurize prices. However, good demand may support prices at lower levels. In the medium term (Dec-Jan), prices are likely to stay firm as there are limited stocks with Syria and Turkey.

Turmeric

Technical Chart Turmeric

NCDEX April contract

Turmeric Futures traded on a positive note hitting the 1 circuit breaker, but corrected towards the end on account of profit booking. Prices have gained over the last few days as stockists were buying at lower levels. Good quality crop arrivals have also supported prices. There are reports of some crop damage in Erode region. Buyers are looking for turmeric with higher curcumin level at 5% which is unavailable, thereby supporting prices in the spot markets. Expectations are that production may be lower by 40-50%. Production is expected around 55 lakh bags. It is estimated that next years carryover stocks would be around 10 lakh bags. There are reports that Turmeric Farmers Association of India have decided to fix their own MSP of Rs.10000/qtl. The Spot as well as the Futures settled 2.89% and 0.12% higher on Friday.

st

Source: Telequote

Production, Arrivals and Exports

Arrivals in Nizamabad and Erode mandi stood at 1,000 bags and 6,000 bags respectively on Friday. Turmeric production in 2012-13 is expected around 64-65 lakh bags. Production in 2011-12 is projected at historical high of 10.62 lakh tn. 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 may trade sideways with a negative bias today as higher carryover stocks and weak overseas demand weigh in on the prices. However, demand from the stockists may support prices at lower levels.

Technical Outlook
Unit Jeera NCDEX March Futures Turmeric NCDEX April Futures Rs/qtl Rs/qtl

Valid for Dec 29, 2012

Support 14590-14720 6390-6496 Resistance 15010-15200 6726-6850

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Commodities Daily Report

Saturday| December 29, 2012

Agricultural Commodities
Kapas
Kapas prices corrected sharply yesterday on account of long liquidation. NCDEX Kapas and MCX Cotton settled 1.69% and 0.55% lower respectively on Friday. Although, Cotton advisory Board has pegged cotton output lower at 334 th lakh bales, Cotton Association of India (CAI), in its latest 90 annual general meeting said that Cotton production in the season 2012-13 is expected to be around 350 lakh bales, while the consumption is likely to be around 265 lakh bales. According to the data released by Cotton Corporation of India, Supplies until Dec. 16 fell to 6.2 million bales of 170 kg each, down from 6.9 th million bales a year earlier. Arrivals were down by 12.5 percent as on 9 December. However, it is still below expectations as many farmers, who are waiting for better returns, hold back their produce. Cotton yarn prices have jumped 14.7 percent from Rs.170/Kg to Rs. 195/Kg in Mumbai benchmark market of cotton yarn due to spur in demand form millers and exporters. Demand is mainly coming from China. While domestic market demand is also picking up on seasonal demand. (Dated 21 Dec) ICE Cotton futures settled lower by 0.51% on Thursday. Global Cotton Prices are expected to recover on account of good demand from china. The USDA monthly report cuts cotton stocks estimate to 79.64 million bales, from last month's forecast of 80.27 million.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 987 16250

as on Dec 28, 2012 % Change Prev. day WoW -1.69 -3.75 -0.55 -1.46 MoM 2.60 -1.46 YoY #N/A -4.13

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 74.66 81.35

as on Dec 28, 2012 % Change Prev day WoW -1.78 -1.62 0.00 0.00 MoM 4.77 0.00 YoY -18.67 -29.20

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Domestic Production and Consumption

According to Cotton Advisory Boards (CAB) estimates (4 Oct 2012) for 2012-13 season that commenced in October, domestic cotton production is pegged 334 lakh bales, down 5.6% from the previous years estimates of 353 lakh bales. Lower opening stocks coupled with estimated lower output will result in lower supplies this season at 374 lakh bales, a decline of 8.7% compared with last years 410.77 lakh bales. On the consumption front, domestic consumption is estimated higher at 270 lakh bales on the back of higher mill consumption. However, after witnessing record exports in 2011-12 season, Indian exports could witness significant fall this season on the back of lower availability along with unattractive domestic cotton prices. CAB estimates cotton exports at 70 lakh bales this season, compared with 128.8 lakh bales last year.
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Source: Telequote

Technical Chart - Cotton

MCX Jan contract

Global Cotton Updates

Net Upland sales of 283,900 running bales for the 2012/2013 marketing year were down 32 percent from the previous week and 24 percent from th the prior 4-week average. (Dated 13 Dec 2012). Cotton harvesting is 84% completed in US, versus 85% same period a year ago. Cotton crop condition is 43% in Good/Excellent state compared to 29% same period a year ago as on 20th Nov 2012. Brazils 2012-13 cotton production forecast at 6.3 million bales, down 27 percent from 2011/12 production now estimated at 8.6 million bales. (USDA Attach report)
Source: Telequote

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

valid for Dec 29, 2012 Support 968-978 16400-16460 Resistance 1000-1020 16590-16670

Outlook
Cotton prices may witness continue to trade on a negative note as higher output expectations by Cotton Association of India has turned the sentiments negative for the cotton prices. However, sharp downside in the domestic markets is expected to be limited in the coming weeks as farmers will not sell their stocks at very low prices. Also demand remains strong at low prices.

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