Commodities Daily Report

Tuesday| February 12, 2013

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

Tuesday| February 12, 2013

Agricultural Commodities
News in brief
CTT a strong possibility
Finance minister P Chidambaram may impose commodity transaction tax (CTT) in the 2013-14 budget to provide a level-playing field for both the stock and commodity markets. In the 2012-13 budget the government cut the securities transaction tax (STT) to 0.1 per cent to lower the cost of stock trading stock exchanges and market players asked that either STT was ended or CTT was imposed. STT, introduced in 2004 and levied on sale and purchase of equities, accounts for 51 per cent of transaction costs in stock markets. With stock trading volumes falling, bankers led by SBI Chairman Pradip Choudhury demanded during this year's pre-budget consultations reiterated the demand for a level playing field. He also said much of the money that could have been invested in the stock market was going into the commodity market. There is also the other view that CTT will help regulate and monitor the commodity market better. The aim of CTT is not to get more revenue. Not more than Rs 3,000 crore in a year can be expected. But the purpose is make commodity transactions in exchanges more transparent. Now that the volumes in commodity exchanges have increased manifold and volumes in stock trading are falling, it is the time to look at CTT, analysts say. Commodity exchanges, however, warn that CTT imposition would encourage illegal trading on the commodity exchanges. (Source: Financial Chronicle)

Market Highlights (% change)

Last Prev. day

as on Feb 11, 2013

WoW MoM YoY

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

19461 5898 53.97 97.03 1648

-0.12 -0.10 0.69 1.37 -1.07

-1.47 -1.49 1.27 0.89 -1.62

-1.03 -0.90 -1.66 3.71 -0.71

9.65 9.59 9.33 -1.66 -4.36

.Source: Reuters

Cotton Association sees output at 354 lakh bales

The Cotton Association of India has estimated cotton crop output to be lower by five per cent this year at 354 lakh bales against 373 lakh bales last year. In December, the association estimated cotton output at 353.25 lakh bales. Arrivals as of January-end were at 177 lakh bales, against 102.50 lakh bales in December. The average daily arrivals continue at an impressive pace of over 2,50,000 bales, said the CAI. Despite the reduction in cotton acreage, the prospects of cotton crop look promising this year. The demand for cotton from the mill sector continues to remain good, it said. The total cotton supply will touch 419 lakh bales with imports of 12 lakh bales and opening stock of 53 lakh bales. On the demand side, the domestic consumption is estimated lower at 271 lakh bales (excluding exports). The mill demand is estimated at 235 lakh bales, while that of small-scale mills and non-mill is 20 lakh bales and 16 lakh bales, respectively. The industry will be left with a surplus of 177 lakh bales, said the CAI. (Source: Business Line)

Wheat procurement to commence in M.P from 18 March 2013

Wheat Procurement process would begin in Bhopal, Hoshangabad, Narmadapuram, Ijjain and Indore divisions from 18 March and in Sagar, Gwalior, Chambal and Rewa, the procurement would start from March 25 2013. (Source: Agriwatch)

Rubber output declines 5% in January; consumption down 9%

Indias natural rubber production declined by 5 per cent to 97,000 tonnes in January, while consumption of the commodity fell by 9 per cent to 75,000 tonnes in the same month, data from Rubber Board shows. The country had produced 1,02,500 tonnes natural rubber while it had consumed 82,535 tonnes in January 2012. Import of natural rubber fell by 18 per cent to 28,905 tonnes in January 2013 from 23,672 tonnes in January 2012, while, the export of the commodity jumped by more than five-fold to 4,850 tonnes from 967 tonnes during the same period. For the first ten months this fiscal, natural rubber output rose marginally to 7,90,200 tonnes from 7,84,400 tonnes in April-January of 2011-12 fiscal.
(Source: Business Line)

Indian government introduce farm machinery banks to help small scale farmers
The Indian government is planning to introduce custom hiring facilities with the help of farm machinery banks and several new programs to promote farm mechanization among small scale farmers in the country. The agricultural ministry aims to increase the reach of farm mechanization to small and marginal farmers with the help of farm machinery banks which will facilitate custom hiring of farm machinery by providing financial assistance to individual self-help groups (SHG) or farmers co-operatives. The Sub-Mission also aims to create ownership of farm equipments among small and marginal farmers in eastern and northeastern region of India, regions which have been identified as future rice granaries of India. (Source: Agriwatch)

Export demand keeps cardamom steady

Good export buying has aided the cardamom market to remain steady last week without dropping despite slack domestic demand at auctions held in Kerala and Tamil Nadu. The individual auction average remained below Rs800 a kg, vacillating between Rs725 and Rs785 a kg last week. However, good export buying helped the market from falling following weak demand from the domestic market. Nobody in the market was aggressive in buying, market sources told Business Line. They said exporters were actively covering as the prices prevailing at present were attractive to the overseas buyers. (Source: Business Line)

Capacity addition in sugar might take time

The proposed capacity addition of about 79,000 tonnes crushing a day ( TCD) in the sugar sector could be delayed by a year or two. The expansion involves an investment of about 4,000 crore. Data compiled by the Centre for Monitoring Indian Economy (CMIE) show mills have planned huge investments to increase production capacity. The expansion plans were drawn up about two years ago, when production was 14.7 million tonnes (mt). Since then, farmers have sown more, and this has led to higher cane output. Against the proposed investment of Rs. 3,000 crore in 2013 according to CMIE data, India Ratings & Research, a Fitch Group company, believes capital expenditure (capex) of large sugar companies this year would be negligible. (Source: Business Standard)

Cotton blooms as exporters stock up

Demand from spinners and exporters to fulfil yarn export orders pushed up cotton on Monday. According to traders, the fibre crop may gain during the week as arrival is marginally down. Exporters have increased purchases expecting higher demand after Chinese New Year holidays, a broker here said. Strong export demand for yarn also pushed buying by local mills. Traders expect exports to Southeast Asia to more than double in 2013, which could compensate to some extent for a fall in demand from China, the worlds largest consumer and traditionally the biggest buyer of the Indian cotton. This financial year, yarn exports are expected to touch a record high owing to demand from China. According to a Textile Commissioner Office source, in 2012-13, about 1,000 million kg of yarn was expected to be exported. (Source: Business Line)

Spot rubber declines further

Domestic rubber markets made further declines on Monday. The local prices continued to post moderate losses tracking the overall weakness in NR futures on the National Multi Commodity Exchange. There has been no indication of a recovery in the commodity as expected even after the peak production season probably due to so many other factors. But the fact is that the growing community is in real trouble at current price levels a trader said. (Source: Business Line)

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Commodities Daily Report

Tuesday| February 12, 2013

Agricultural Commodities
Chana
Chana prices declined yesterday on account of increasing supplies in the domestic markets amid start to harvesting. Further, higher output expectations also exerted pressure on the prices. Spot as well as futures settled 1.36% and 0.88% lower on Monday. Ministry of Agriculture in its second advance estimates, have pegged, bumper chana output for 2012-13 season at 8.57 mn tn, up 11% from 2011-12 final estimates of 7.7 mn tn.

Market Highlights
Unit Rs/qtl Rs/qtl Last 3560 3396 Prev day -1.36 -0.88

as on Feb 11, 2013 % change WoW MoM -0.44 -11.01 -1.48 -16.62 YoY -2.58 -6.83

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

Source: Reuters

Pulses Sowing 2012-13

Technical Chart - Chana
Total pulses acreage as on 08 Feb 2013 stood at 148 lakh ha, up by 0.5% yoy. Chana sowing is 5.4% higher at 94.78 lakh ha compared to previous year. Chana acreage is marginally higher by 3% this year in Rajasthan at 14.80 lakh ha, In Maharashtra, Chana acreage is up at 11.12 lakh ha vs normal area of 10.6 lakh ha. While in AP it is up at 7.27 lakh ha, up by 28%. Compared to previous year. (Source: State farm dept)
NCDEX April contract

Demand supply fundamentals

According to second advance Estimates released on 8 Feb 2013, Total pulses output for 2012-13 season has been pegged at 17.58 mn tn, down 3.3% compared to previous year. The target for 2012-13 pulses crop output was set at 18.24 million tonne during the year. However, drought conditions have hampered kharif pulses output, which has been only partially offset by Rabi pulses output, especially chana. Out of the total pulses output, kharif output is estimated at 23% lower at 5.48 mn tn while rabi pulses output is pegged 8.72% higher at 12.09 mn tn compared with the final estimates of 2011-12. There has been a sharp increase in the chana output estimates. on the back of higher acreage and good yield. Chana output is expected to breach its 2010-11 record of 8.2 mn tn and is estimated at 8.57 mn tn for 2012-13. In its first advance estimates chana output was pegged at 7.9 mn tn. India needs imports as its domestic production is insufficient to meet the rising demand. The countrys import bill on pulses stood at $1.83 billion in 2011-12. 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).
th

Source: Telequote

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

valid for Feb 12, 2013 Resistance 3410-3430

3365-3380

Trade Scenario
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
Chana Futures are expected to remain under downside pressure today as the agriculture ministry has estimated bumper chana output for 2012-13 season. Also arrivals shall gain momentum in the coming days and is expected to increase the supplies in the markets. Also, higher output of Chana in other producing countries like Australia and Canada is expected to support the weak market sentiments.

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Commodities Daily Report

Tuesday| February 12, 2013

Agricultural Commodities
Sugar
Sugar March contract recovered sharply yesterday on hopes of partial decontrol of sugar industry. Bargain buying was also seen at lower levels. Also, traders expect demand to improve in the coming summer months. Prices have corrected over the last few weeks on account of higher production and availability in the domestic markets and comparatively lower demand amid winter season. The Spot as well as the Futures settled 0.17% and 1.31% higher on Monday. Food minister KV Thomas on Thursday said the government is likely to take a decision on decontrolling the sugar industry before the Budget. Food ministry has proposed dispensing with the regulatory release mechanism and abolishing the levy system. India has fixed FRP (Fair and Remunerative Price), the price sugar mills must pay to cane growers at 210 rupees per 100 kg in the 2013/14 year, compared to current years 170 per qtl. Higher floor price increases the cost of production as the raw material cost constitute the major part of cost of production of sugar. This should actually increase the prices of sugar. Raw sugar futures on ICE as well as Liffe white sugar traded on a positive note and settled 0.64% and 1.65% higher respectively on Monday due to lack of sellers in Brazil due to Carnival holiday.

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Feb'13 Futures Rs/qtl Last 3187

as on Feb 11, 2013 % Change Prev. day WoW 0.17 -1.27 MoM -1.73 YoY 7.38

Rs/qtl

3050

0.96

-0.55

-4.72

5.32

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 488.5 409.78

as on Feb 11, 2013 % Change Prev day WoW 0.64 1.65 -2.01 -1.55 MoM -4.68 -2.74 YoY -25.64 -25.16

.Source: Reuters

Technical Chart - Sugar

NCDEX March contract

Domestic Production and Exports

Out of the estimated 24 mn tn sugar output for the season 2012-13, Indian 13.7 mn tn in the first four months of the season beginning October 2012, up 3 percent a year ago period. 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. Exports are not viable as international prices have also declined significantly.

Global Sugar Updates

The USDA on Friday boosted its domestic sugar supply forecast in the 2012/13 marketing year, projecting record production. U.S. sugar production in the current marketing year is pegged at 9.22 million short tons, up from last month's estimate at 9.07 million tons. If the forecast is realized, it will be a record high, exceeding the record 9.032 million short tons harvested in the United States in 1999/2000. In the international markets, ICE Raw sugar fell to their lowest level since August 2010 to 18.46 cents in the last week expecting third consecutive year of global surplus in 2012-13. A third consecutive global sugar surplus will trim prices as supply is forecast to exceed demand by more than 8 million tonnes in the crop year to September 2013. Markets would need weather scares or bullish ethanol policy changes in Brazil to encourage new longs. Otherwise, prices will remain depressed. Brazil's main center-south cane crop will produce between 580 million and 590 million tonnes of sugar cane in 2013/14. Brazil will likely favor ethanol production over sugar from the 2013/14 cane crop.

Source: Telequote

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

valid for Feb 12, 2013 Resistance 3105-3120

3040-3065

Outlook
Sugar futures are expected to trade on a positive note today due to bargain buying. Prices may consolidate at the lower levels as markets may adopt a wait and watch policy expecting government to take decision levy sugar mechanism, one of the major reforms of sugar decontrol. The hike in cane price and thereby increase in sugar production cost may also support prices as this may force government to take some measures to increase sugar prices.

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Commodities Daily Report

Tuesday| February 12, 2013

Agricultural Commodities
Oilseeds
Soybean: Soybean futures declined yesterday tracking weaker
international markets as the USDA monthly crop report released on Friday pegged higher global ending stocks. The Spot settled marginally higher by 0.06% while the March Futures settled 2.04% lower on Monday. Oil meal exports rose by almost 40 per cent to 7.68 lakh tonnes in January this year, industry body Solvent Extractors Association of India said. The export of oil meals, however declined by 18 per cent to 36.79 lakh tonnes in the first 10 months of this fiscal compared to 44.85 lakh tonnes in the year-ago period. The country exported 25.36 lakh tn soybean meal in first 10 months compared to 30.82 lakh tn in the same period last year which showing a decline of 17.72%. According to the second advance estimates, 2012-13 oilseed output is pegged at 29.4 mn tn, down by 1.1%, while soybean output is pegged higher at 12.9 mn tn, up 3.2%.

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Feb '13 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Feb '13 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3327 3250 730.8 721.4

as on Feb 11, 2013 % Change Prev day 0.06 -1.56 -0.47 -0.39 WoW -1.36 -2.39 -3.33 -2.86 MoM 4.46 5.31 -0.25 -0.57 YoY 32.44 30.21 4.13 3.63

Source: Reuters

as on Feb 11, 2013 International Prices Soybean- CBOTMar'13 Futures Soybean Oil - CBOTMar'13 Futures Unit USc/ Bushel USc/lbs Last 1432 51.24 Prev day -1.45 -0.37 WoW -3.85 -3.52 MoM 0.47 4.83
Source: Reuters

YoY 16.48 -2.46

International Markets
Soybean futures on the CBOT corrected sharply extending Fridays fall as USDA raised its forecast of global 2012/13 soybean ending stocks above 60 million tonnes, up from 59.46 million in January and settled 1.45% lower on Monday. Upward revision in Brazils soy output is offset by downward revision in the Argentina production. However, persistent dry, hot weather in much of Argentina is hurting 2012/13 crops as they enter crucial growth stages, and rains are needed to safeguard potential yields, the countrys agriculture ministry said last week. Thus output may be revised down further. China, the world's largest soy buyer, imported 4.78 million tonnes of soybeans in January, down 18.8 percent from 5.89 million tonnes in December

Crude Palm Oil

as on Feb 11, 2013 % Change Prev day WoW 0.40 -0.33 -1.27 -0.44

Unit
CPO-Bursa Malaysia Feb '13 Contract CPO-MCX- Feb '13 Futures

Last 2480 450.2

MoM 4.69 4.24

YoY -19.82 -13.67

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Apr'13 Futures Rs/100 kgs Rs/100 kgs Last 4095 3388 Prev day -2.50 -0.09

as on Feb 11, 2013 WoW 1.11 -1.94 MoM -3.08 -19.45

Source: Reuters

Refined Soy Oil: Ref soy oil March settled 0.85% lower yesterday
taking cues from weak international markets while MCX CPO settled 0.33% lower tracking weak edible oil segment. The head of the Solvent Extractors' Association of India has proposed India should raise the duty on crude edible oil imports to 10 percent from the recently revised 2.5 percent. India's palm oil imports rose 27.4% on month at 783,091 tn in December, boosted mainly by poor domestic supply of alternatives and attractive overseas prices due to record stocks in key supplier Malaysia.

YoY 19.82 -0.18

Technical Chart Soybean

NCDEX March contract

Rape/mustard Seed: Mustard seed spot as well as Futures settled

2.5% 0.09% lower Monday on higher output expectations. Mustard seed sowing is now up by 2.2% at 67.23 lakh ha. Arrivals are expected to commence in February and thus no major upside in the prices is seen if weather condition improve in the coming days. Agriculture ministry in its third advance estimates, pegged mustard output at 7.36 mn tn , up by 11.5%.

Outlook
Soybean complex may open higher due to short coverings at lower while, but it may correct towards the later part of the day taking cues from the weak international markets as USDA report raised its forecast of ending stocks. Mustard seed is expected to trade downwards on higher output expectations. CPO is expected to trade sideways during the intraday.

Source: Telequote

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

valid for Feb 12, 2013 Support 689-692 3120-3145 3350-3370 444-448 Resistance 698-702 3210-3250 3400-3420 453-456

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Commodities Daily Report

Tuesday| February 12, 2013

Agricultural Commodities
Black Pepper
Pepper March Futures recovered sharply from lower levels on account of low stocks, thin supplies and delayed harvesting due to lack of skilled laborers. Some improvement in the arrivals of the fresh crop led to a decline in the prices earlier last week. Good winter demand also supported the prices. Food Safety and Standards Authority of India sealed the entire quantity of pepper stored in six warehouses in Kerala of about 8,000 tonnes. Harvesting of the fresh crop is going in and is expected to gain momentum in the coming days. Exports demand for Indian pepper in the international markets is also weak due to price parity. The Spot settled lower by 0.43% while the March Futures settled 1.33% higher on Monday. According to a circular issued by NCDEX on 09/02/2013, launch of June 2013 expiry contract in Pepper which is scheduled on February 11, 2013, has been postponed till further notice. The revised launch date will be announced in due course. Spices Board has announced plans to import high yielding Madagascar variety that was behind the record productivity in Vietnam. It could raise productivity of Indian pepper from 2,000 kg/ha to 7,000 kg/ha. Pepper prices in the international market are being quoted at $8,000/tn(C&F Europe). Vietnams 550 GL is quoted at $6,500/tn, Malaysia and Indonesia Austa variety are quoted at $7,000/tn and Brazil black pepper is quoted at $6,600/tn.

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Feb'13 Futures Rs/qtl Rs/qtl Last 40181 38720 % Change Prev day -0.43 -0.03

as on Feb 11, 2013 WoW -1.03 -0.24 MoM 4.20 8.08 YoY 28.76 31.59

Source: Reuters

Technical Chart Black Pepper

NCDEX March 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 Mar Futures Unit Rs/qtl

valid for Feb 12, 2013 Support 35670-35980 Resistance 36530-36840

Production and Arrivals

The arrivals in the spot market were reported at 20 tonnes while off takes were reported at 21 tonnes on Monday. 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 recover today on account of low stocks coupled with thin arrivals may limit sharp downside. Winter buying demand may also support prices at lower levels. However, any improvement in arrivals will cap sharp upside.

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Commodities Daily Report

Tuesday| February 12, 2013

Agricultural Commodities
Jeera
Jeera Futures traded on a mixed note yesterday and settled marginally higher by 0.29% while the spot remained lower and settled 1.2% lower on commencement of arrivals of the new crop. The arrivals of new crop is around 300-400 bags/day and is expected to gain momentum in the coming days. Some export demand from Bangladesh was reported last week. Higher sowing as well as conducive weather in Gujarat, the main jeera growing region has increased output expectations. Sowing is complete. According to Gujarat State Agri Dept. sowing in Gujarat is reported at 3.244 lakh ha till Jan, 2013 compared with 3.64 lakh ha last year. In Rajasthan, sowing is expected to increase by 10-15%. 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 $2,950-2,975 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 Spot- NCDEX (Unjha) Jeera- NCDEX Mar '13 Futures Rs/qtl Rs/qtl Last 13697 13138 Prev day -1.20 0.29

as on Feb 11, 2013 % Change WoW -2.79 -4.40 MoM -5.09 -4.30 YoY -8.23 -8.23

Source: Reuters

Technical Chart Jeera

NCDEX March contract

Production, Arrivals and Exports

Arrivals in Unjha were reported at 3,200 tn on Monday. 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 1.13 0.90

as on Feb 11, 2013 % Change

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

Last 5404 6270

WoW -0.47 -2.25

MoM -5.07 -5.46

YoY 12.42 23.62

Outlook
Jeera is expected to continue to trade on a mixed note. Prices may decline on the back of commencement of arrivals of the new crop. Higher sowing figures coupled with conducive weather in Gujarat may also pressurize prices. However, overseas demand at lower levels may support prices. Demand from domestic traders and millers may also support prices at lower levels. In the medium term, prices are likely to stay firm as Syria and Turkey have stopped shipments.

Technical Chart Turmeric

NCDEX April contract

Turmeric
Turmeric Futures traded on a positive note due to demand from local buyers. Prices have corrected from higher levels due to higher carryover stocks. There are reports of some crop damage in Erode region. 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 1.13% and 0.9% higher on Monday.

Production, Arrivals and Exports

Arrivals in Erode and Nizamabad mandi stood at 2,500 bags and 10,000 bags respectively on Monday. Turmeric production in 2012-13 is expected around 55 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 on a mixed note today. Higher carryover stocks and weak overseas demand may pressurize prices. However, lower output concerns and demand from stockists at lower levels is expected to support prices at lower levels.
.

Source: Telequote

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

Valid for Feb 12, 2013

Support 12830-12970 6080-6170 Resistance 13270-13440 6350-6430

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Commodities Daily Report

Tuesday| February 12, 2013

Agricultural Commodities
Kapas
After witnessed sharp decline, NCDEX Kapas recovered 0.62% on Saturday taking cues from the international markets which rose after the release of USDA monthly report. MCX Cotton also settled 0.6% higher on Saturday. Prices have declined initially on the back higher availability of cotton amid dull demand. Cotton supplies from the new crop in the domestic markets until Jan. 20 fell were down at 134 lakh bales, from 144 lakh bales a year earlier. However, gap has narrowed down with increasing pace of arrivals. The Cotton Advisory Board, which met in Mumbai on Wednesday, has estimated cotton production this season (Oct 2012 to Sep 2013) will be 330 lakh bales against the previous estimates in October at 334 lakh bales. Also, exports and domestic consumption has been revised upward to 253 and 80 lakh bales respectively from 250 and 70 lakh bales estimated earlier. As on January 9 this year, nearly 38 lakh bales were registered for exports. ICE Cotton settled 1.56% higher on Friday as USDA report trims US stocks. Prices have also traded on a bullish note on hopes of demand from China. Concerns about the quality of cotton to be released by China also supported the prices.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 905 17040

as on Feb 11, 2013 % Change Prev. day WoW 2.09 2.49 1.01 2.47 MoM -3.57 2.47 YoY #N/A -5.39

NCDEX Kapas Apr Futures MCX Cotton Feb Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit USc/Lbs Last 82.92 81.35

as on Feb 11, 2013 % Change Prev day WoW 0.30 1.44 0.00 0.00 MoM 10.27 0.00 YoY -9.40 -29.20

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Domestic Production and Consumption

According to Cotton Advisory Boards (CAB) estimates (23 Jan 2013) for 2012-13 season that commenced in October, domestic cotton production is pegged 330 lakh bales, down from the previous years estimates of 353 lakh bales. However, higher exports and domestic consumption can be met through revised higher opening stocks of 40 lakh bales and higher imports. 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 80 lakh bales this season, compared with 128.8 lakh bales last year.
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Source: Telequote

Technical Chart - Cotton

MCX Feb contract

Global Cotton Updates

The U.S. government on Friday nudged higher its global cotton stockpile forecast for 2012/13 amid expectations that China, the world's largest textile market, will import even more fiber for its massive strategic supply. However, the government lowered US carryover by 300,000 bales, or 6 percent, to 4.5 million bales due to an increase of the same size in its export estimate to 12.5 million bales.

Outlook
Kapas prices may trade with upward bias during the intraday on account of bargain buying. However, sufficient supplies in the domestic markets and lower export demand expectations may pressurize prices. Also, international prices which had gained sharply in the last two weeks are due for correction amid rising certified stocks, and Chinese lunar New Year approaching.
Source: Telequote

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

valid for Feb 12, 2013 Support 875-890 16750-16900 Resistance 916-930 17200-17340

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