Commodities Daily Report

Monday| November 19, 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 Analyst anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132

Vaishali Sheth - Research Associate vaishalij.sheth@angelbroking.com (022) 2921 2000 Extn. 6133
Angel Commodities Broking Pvt. Ltd. Registered Office: G-1, Ackruti Trade Centre, Rd. No. 7, MIDC, Andheri (E), Mumbai - 400 093. Corporate Office: 6th Floor, Ackruti Star, MIDC, Andheri (E), Mumbai - 400 093. Tel: (022) 2921 2000 MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX: Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302

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Commodities Daily Report

Monday| November 19, 2012

Agricultural Commodities
News in brief
FMC stakeholders meet generates new ideas for market expansion
Even as commodity futures market is growing in terms of turnover and traded volumes, and the market is now ready for elevation to the next higher level, the government believes that the regulator must maintain an arms-length relationship with the market, while enabling the market to develop in a healthy and transparent manner, Pankaj Agrawala, Secretary, Union Ministry of Consumer Affairs, has asserted. He was addressing a stakeholders meet for the oilseeds-based industry and trade organised by the market regulator Forward Markets Commission (FMC) in conjunction with various national commodity futures exchanges such as NCDEX, MCX, NMCE, ACE and ICEX. Suggesting that participation of hedgers those with genuine exposure to the underlying commodity for price risk management was critical in the volatile marketplace, Agrawala expressed hope that the market would help deliver benefits to different stakeholders such as producers, processors, industrial consumers, exporters, importers and traders. Other suggestions included researching new commodities for launching on the trading platform as well as awareness and education programs in different parts of the country aimed at specific commodity stakeholder groups.
(Source: Business Line)

Market Highlights (% change)

Last Prev. day

as on Nov 16, 2012

WoW MoM YoY

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

18309 5574 55.17 86.67 1714

-0.88 -1.01 0.93 1.43 0.06

-2.00 -1.97 1.04 0.70 -0.92

-2.16 -1.99 4.11 -5.64 -1.25

8.45 9.97 8.96 -12.78 -3.78

Source: Reuters

Vietnam 2012/13 coffee output may drop 5 pct in Daklak

Coffee output from the 2012/2013 harvest in Daklak, Vietnam's top growing province, may shrink less than 5 percent to 465,000 tonnes, or 7.75 million bags, a provincial report said, well below an earlier projected fall of around 10 percent. The latest forecast was released on Friday by the Daklak People's Committee, the local government, which also forecast it would export 350,000 tonnes of coffee this crop year, a rise of 17 percent, the Daklak trade promotion centre said. On Tuesday, a Daklak agriculture department official told Reuters the province's output may fall around 10 percent to between 440,000-450,000 tonnes. (Source:
Reuters)

S.Korea 2012 rice output down; no supply disruption seen

South Korea's rice output fell 5.2 percent to 4 million tonnes this year from a year earlier, the country's statistics office said on Monday, while the agriculture ministry said the lower output would not disrupt its supply thanks to imports and stocks. The fall in this year's rice output came as typhoons during the summer and less sunshine affected the heading and ripening stage of rice cultivation, state-run Statistics Korea (KOSTAT) said in a statement. Earlier this month, the U.S. Department of Agriculture cited KOSTAT's previous estimate that 2012 rice output would fall 3.5 percent from last year. A separate statement from the agriculture ministry said on Monday that Asia's fourth-largest economy has 5.4 million tonnes of the main staple with this year's home-grown rice, imports and from inventory, surpassing the country's expected demand at 4.6 million tonnes. (Source: Reuters)

Punjab paddy purchase to top record 13 million tonnes

Paddy procurement in Punjab is expected to exceed a record 13 million tonnes (mt) during the current marketing season (October 2012September 2013) on higher arrivals. We expect to procure about one million tonnes more than last year, A.S. Arunachalam, Deputy General Manager, Food Corporation of India, told reporters. So far, Government agencies have procured 12.7 mt, some 7 per cent more than last years 11.9 mt through some 1,770 mandis and procurement centres across the State. Despite deficient monsoon, farmers in Punjab planted paddy on 28 lakh hectares this year. In neighbouring Haryana, the procurement by State-agencies is almost complete. State agencies have procured about 3.75 mt by November 15 30 per cent more than 2.87 mt in corresponding last year, according to Food Ministry data. (Source: Business
Line)

China to halt regular state soy sales from this week

China, the world's top soy buyer, will temporarily halt regular state soy sales from this week as Beijing starts a stockpiling programme for the oilseed, an official think tank said on Monday, to improve margins for soy plants and spur imports. The suspension is to stop traders and crushers selling their purchases from regular state sales back to the government as Beijing starts buying soybeans from the market at higher prices, said the China National Grain and Oils Information Center (CNGOIC). The Chinese government will start stockpiling soy and corn from local farmers at higher prices than a year ago, an industry source said last week, a step set to stabilise domestic prices. (Source: Reuters)

Maharashtra co-op sugar mills agree to pay Rs 2,500/tonne

Maharashtra Finance Minister Jayant Patil on Sunday said most of the cooperative sugar factories in western Maharashtra have agreed to pay Rs 2,500 for a tonne of sugarcane as first advance to farmers. He was talking to reporters at Islampur after attending a meeting of chairpersons of all sugar factories of western Maharashtra. (Source: Business Line)

Cyclone warning in Bay withdrawn for now

The India Meteorological Department (IMD) appeared to have withdrawn by Sunday evening outlook for cyclone formation in the Bay of Bengal. The watch had been mounted from earlier in the morning, and continued into later in the afternoon. The causative low-pressure area in East Bay of Bengal had undergone intensification thrice over during the past couple of days to become a deep depression. It was expected that it would go on to become the next cyclone after Nilam, but dry air wrapping into it has compromised outlook for strengthening. Had it been located more to the south, the scope could have been more, given wider expanse of seawater. While taking note, US Navys Joint Typhoon Warning Centre (JTWC) said that the system might still undergo some weak intensification. It was not clear this would give it just the additional windup to attain cyclone status, in which case it would be named Mahasen. It was located about 950 km East-northeast of Chennai, 600 km East-southeast of Visakhapatnam and 520 km southeast of Paradip.
(Source: Business Line)

FDI in multi-brand retail can strengthen supply chain

India is the worlds largest producer of fruits and vegetables, has the largest area under wheat, rice and cotton and is the second-largest producer of rice and wheat. That is the good news. But, at the other end of the spectrum, India loses about Rs 50,000 crore annually on account of frail post-harvest infrastructure. Inadequate warehouses and cold storages and poor road and rail transportation are some of the red flags in the Indian logistics landscape. The Governments initiative to allow 51 per cent foreign direct investment (FDI) in multi-brand retail has been a subject for debate for quite some time now. The Government appears to be confident of drumming up enough support to counter the oppositions move to block it in the ensuing winter session of Parliament that begins next week. A minimum investment of $100 million and a mandatory 50 per cent capital reinvestment in back-end operations have been proposed. (Source: Business Line)

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Commodities Daily Report

Monday| November 19, 2012

Agricultural Commodities
Chana
Chana futures settled marginally higher by 0.6% owing to short coverings. Overall demand for chana will be subdued in the coming days while supplies are expected to ease amid higher shipments. Except for Wheat, minimum support price of all other Rabi crops has been increased by CCEA for 2012-13 season. MSP of Chana/Gram is raised by Rs 200 per qtl for 2012-13 season to Rs 3000. Higher returns and favorable soil condition will definitely boost acreage in the coming season. Total pulses acreage is so far down this year by 17% to 65.3 lakh hectares. However, according to state farm department data, pulses sowing is higher in Maharashtra and AP, while it is lagging behind in Rajasthan. Area under Chana cultivation in Maharashtra is up by 20 percent at 4.9 lakh hectares. While in Andra Pradesh it is at 4.64 lakh hectares compared with 3 lakh hectares. However, in Rajasthan, sowing is much behind last years level due to late harvesting of kharif crops on account of delayed and deficient rains. As per the NCDEX circular dated 9 November, the pre expiry margin on Chana November 2012 contract has been increased from the existing 3% to 7% for last 5 trading days increased on a daily basis on both buy and sell sides. In Rajasthan, the third largest Chana producing states, sowing is lagging behind by almost 55% and stands at 5.45 lakh hectares as on th 9 November, 2012. 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.
th

Market Highlights
Unit Rs/qtl Rs/qtl Last 4600 4716 Prev day 0.29 0.60

as on Nov 17, 2012 % change WoW MoM 2.30 0.23 1.99 1.18 YoY 43.09 49.00

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

Source: Reuters

Technical Chart - Chana

NCDEX Dec contract

Source: Telequote

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

valid for Nov 19, 2012 Resistance 4435-4468

4308-4345

Sowing progress and demand supply fundamentals

Improved rains towards the end of monsoon season coupled with hike in MSP have raised prospects of Chana sowing in the 2012-13 season. Also, 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 Ministry of Agriculture 99.81 Lakh hectare area has been planted under Kharif pulses in 2012-13 compared to 108.28 lakh hectare (ha) in the previous 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. 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)

Outlook
Chana futures may remain under downside pressure on expectations of ease in supplies amid higher shipments coupled with subdued demand. Going forward, prices may also take cues from sowing progress of Rabi pulses which is expected to gain momentum in the coming days.

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Commodities Daily Report

Monday| November 19, 2012

Agricultural Commodities
Sugar
Sugar Futures settled higher by 0.4% as delay in cane crushing in the key producing states supported the upside. Also, hike in cane prices demanded by farmers is fuelling up the prices. Usually most factories in Maharashtra, the top sugar producer in the country, start cane crushing by the first week of November, but it has been delayed this year as farmers and mills have not yet agreed on cane prices. The sugar unions are demanding Rs 3000 per qtl. In UP too crushing normally starts in the first week of November, but this year also crushing is delayed due to disputes over cane pricing. Despite festival season, prices remained under check this season as government has released higher quota of 40 lakh tonnes for October and November, compared to 34.6 lakh tonnes during 2011. Liffe white sugar as well as ICE raw sugar closed higher on Friday by 0.53% and 0.37% on account of short covering at lower levels. Higher pace of crushing in Brazil Higher output and lower imports expectations for the 2012-13 season from China coupled with higher sugar surplus forecast for fourth straight year has led to a sharp decline in international sugar prices during the past few weeks.

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Nov '12 Futures Rs/qtl Last 3463

as on Nov 17, 2012 % Change Prev. day WoW 0.53 0.37 MoM -0.81 YoY 11.59

Rs/qtl

3472

0.40

2.42

5.50

17.18

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 509.3 425.56

as on Nov 16, 2012 % Change Prev day WoW -4.48 0.58 -3.81 0.47 MoM -8.28 -4.77 YoY -18.47 -20.51

Source: Reuters

Domestic Production and Exports

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.

Technical Chart - Sugar

NCDEX Dec contract

Source: Telequote

Global Sugar Updates

Sugar output in Brazil jumped 57% during the first fortnight of October. Thus, sugar output in brazil which was lower compared to last year since the beginning of the crushing season in May, is now up marginally by 0.1% at 29.3 mn tn. Brazil exported 3.998 million tons of sugar, raw value, in October up from 2687 million tons in September. Brazil has exported only 15.59 million tons of sugar this year till October which was 17.17 million tons, raw value, last year same period. 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 Dec NCDEX Futures Unit Rs./qtl Support

valid for Nov 19, 2012 Resistance 3345-3360

3300-3315

Outlook
Sugar prices may trade higher as delayed crushing in key sugar producing states might support further upside in the prices. However, sharp upside might be capped on back of sufficient supplies due to higher non-levy quota.

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Commodities Daily Report

Monday| November 19, 2012

Agricultural Commodities
Oilseeds
Soybean: Soybean futures traded on a positive note yesterday on
account good demand from solvent extractors. However, sharp upside was capped on account of weak international markets. The spot as well as the Futures settled 0.55% and 0.34% higher respectively on Saturday. Arrivals which had declined considerably during the last two weeks are expected to improve in the coming days. Soy meal exports during October are down 49,840 tn in October, the seventh consecutive month of fall in the current fiscal year, from 223,594 tn a year ago. This is because; most export commitments were done for forward trade like Nov-Dec amid uncertainty over supplies in October. According to first advance estimates, Soybean output is pegged at 126.2 lakh tn for 2012-13.

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Nov '12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Nov '12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3276 3226 708.8 703.7

as on Nov 17, 2012 % Change Prev day 0.55 0.34 0.93 1.73 WoW 0.09 -0.06 2.70 5.10 MoM 0.18 -2.88 1.80 1.94 YoY 45.86 42.30 10.01 8.39

Source: Reuters

as on Nov 16, 2012 International Prices Soybean- CBOTNov'12 Futures Soybean Oil - CBOTDec'12 Futures Unit USc/ Bushel USc/lbs Last 1383 47.05 Prev day -1.34 -0.86 WoW -4.73 -1.51 MoM -8.35 -7.80 YoY 16.46 -10.35

International Markets
CBOT Soybean settled lower by 1.34% on reports that China has cancelled 10 cargoes of US Soy scheduled for delivery in December and January. Also, prospects of bumper production in south America along with higher supplies in US pressurized prices. The National Oilseed Processors Association (NOPA) reported the U.S. soybean crush for October at 153.536 million bushels, the largest monthly figure since January 2010 and the highest for October since 2009. According to the USDA November monthly report, The U.S. Department of Agriculture on Friday raised its estimate for soybean production by 4% from its forecast last month, saying that rainfall late in the growing season softened the impact of the U.S. drought. Area and production in Argentina for MY 2012-13 are maintained at 19.7 million hectares and 55 million tonnes, respectively. Brazil's government on 8 Nov 2012 edged up its forecast for a record 2012/13 soybean crop to between 80.1 and 83 mn tn.
th

Source: Reuters

Crude Palm Oil

as on Nov 17, 2012 % Change Prev day WoW 9.77 1.06 4.94 3.97

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

Last 2360 437.8

MoM -1.95 0.62

YoY -27.47 -15.07

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Nov '12 Futures Rs/100 kgs Rs/100 kgs Last 4400 4253 Prev day 3.83 0.66

as on Nov 17, 2012 WoW 2.92 2.26 MoM 4.76 -0.37

Source: Reuters

YoY 41.03 32.29

Refined Soy Oil: Ref soy oil as well as MCX CPO traded on a
negative note yesterday and settled lower by 0.35% and 0.51% tracking the weak international BMD prices. Exports of Malaysian palm oil products for Nov. 1-15 were 769,087 tonnes, down 0.1 percent from 769,534 tonnes exported in the Oct. 1-15 period. According to latest data from SEA, total vegetable oil imports in September were 993,912 tn, up from 897,018 tn in the previous month. As per MPOBs latest report, Malaysia's September palm oil stocks rose 17 percent to record high 2.48 million tons compared to previous month.

Technical Chart Soybean

NCDEX Dec contract

Rape/mustard Seed: Rm seed futures settled higher by 2.92% on

account of tight supplies of this oilseed to meet the winter season th demand.. Rabi oilseeds sowing as on 10 November was reported at 43.21 lakh ha as compared to 35.18 lakh ha in the same period last year. MSP for Mustard seed is increased by 20% from Rs 2500/Quintal to Rs 3000/Quintal for 2012-13 season.

Outlook
Edible oil complex may trade on a negative note today on expectations of arrivals to improve in the current week.. Also, weak international markets may keep prices under check. However, higher crushing led by robust demand soy meal in the domestic as well as global markets may restrict a sharp downside.

Source: Telequote

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

valid for Nov 19, 2012 Support 683-688 3175-3225 4200-4250 438-441 Resistance 699-706 3297-3325 4335-4368 449-454

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Commodities Daily Report

Monday| November 19, 2012

Agricultural Commodities
Black Pepper
Pepper futures trade on a bearish note last week on reports that FMC has launched probe into complaints against pepper market movement. Also expectations of better output in the domestic as well as the international markets pressurized prices. Farmers are trying to liquidate their stocks ahead of the commencement of arrivals of the fresh crop. Exports demand for Indian pepper in the international markets remains weak due to huge price parity. However, there is good festive as well as winter demand. The Spot as well as Dec Futures settled 2.57% and 5.45% w-o-w. Pepper prices in the international market are being quoted at $8,200/tn(C&F) while Vietnam was offering Austa at $7,000/tn, Brazil Austa at $6,700/tn, and Indonesia Austa at $6,500/tn (FOB).

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Nov '12 Futures Rs/qtl Rs/qtl Last 40118 39605 % Change Prev day -0.66 -1.05

as on Nov 17, 2012 WoW -2.57 -5.11 MoM -5.12 -10.26 YoY 14.58 11.80

Source: Reuters

Technical Chart Black Pepper

NCDEX Dec 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 September 2012 is estimated around 80,433 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 Dec Futures Unit Rs/qtl

valid for Nov 19, 2012 Support 37800-38250 Resistance 39150-39500

Production and Arrivals

The arrivals in the spot market were reported at 7 tonnes while offtakes were 9 tonnes on Saturday. As per IPC, Global pepper production in 2012 is projected at 3.27 lk tn, up by 12.7% compared with 2.98 lk tn in 2011. Indonesian pepper output Is expected to rise by 24% and in Vietnam by 10%. According to previous estimates, 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). 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) 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 witness downside pressure today. Liquidation pressure from farmers as well as low export demand may pressurize prices. Good supplies in the international market from other origins may also keep prices under check. However, festive season as well as winter demand may support prices at lower levels.

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Commodities Daily Report

Monday| November 19, 2012

Agricultural Commodities
Jeera
Jeera Futures traded on a mixed note last week. Export enquiries supported prices in the initial part of the week. However, prices corrected towards the end of the week on long liquidation. The sowing of the crop is going on and is expected to gain momentum in the coming days, thus pressuring prices. Sowing in Gujarat is currently lower by 15-20%. Festive demand is also expected to improve. Exporters have been buying due to tensions between Syria and Turkey. The spot remained closed due to Diwali while the December Futures settled 1% lower w-o-w. 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 $2,850 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 4-5 lakh bags lower by around 3 lakh bags last year.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Nov '12 Futures Rs/qtl Rs/qtl Last 15064 14413 Prev day 0.00 0.16

as on Nov 17, 2012 % Change WoW 0.00 -0.38 MoM -0.07 -4.69 YoY 6.14 7.33

Source: Reuters

Technical Chart Jeera

NCDEX Dec contract

Production, Arrivals and Exports

Unjha markets witnessed arrivals of 8,000 bags, while off-takes stood at 8,000 bags on last Saturday. Production of Jeera in 2011-12 is expected to be around 40 lakh bags as compared to 29 lakh bags in 2010-11 (each bag weighs 55 kgs). (Source: spot market traders). According to Spices Board of India, exports of Jeera in April 2012 stood at 2,500 tonnes as compared to 2,369 tonnes in April 2011, an increase of 6%.
Source: Telequote

Market Highlights
Prev day 0.00 -0.60

as on Nov 17, 2012 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Nov '12 Futures Rs/qtl Rs/qtl

Last 5062 5320

WoW 0.00 -1.34

MoM 0.81 4.19

YoY -6.19 16.77

Outlook
Jeera futures are expected to trade downwards today. Prices may correct as farmers are liquidating their stocks for want of cash. However, sharp downside may be capped due to export demand. In the medium term (November-December 2012), prices are likely to stay firm as there are limited stocks with Syria and Turkey.

Technical Chart Turmeric

NCDEX Dec contract

Turmeric
Turmeric Futures opened the week on a positive note due to upcountry demand. However, the prices corrected in the later part of the week on account of long liquidation. Also, weak overseas demand pressurized prices. Stockists have good carryover stocks with them. Turmeric has been sown in 0.58 lakh hectares in A.P as on 10/10/2012. Sowing is also reported 30-35% lower during the sowing period. The Spot as remained closed on account of Diwali while the December Futures settled 0.47% lower w-o-w. Production, Arrivals and Exports Arrivals in Erode and Nizamabad mandi stood at 10,000 bags and 700 bags respectively on last Friday. Turmeric production for the year 2011-12 is projected at historical high of 90 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 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. Outlook Turmeric prices are expected to trade on a negative note today on account of good carryover stocks with the stockists. However, good demand from North India coupled with low arrivals in Erode mandi is expected to support prices.

Source: Telequote

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

Valid for Nov 19, 2012

Support 14430-14620 5000-5060 Resistance 14930-15080 5180-5230

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Commodities Daily Report

Monday| November 19, 2012

Agricultural Commodities
Kapas
NCDEX Kapas futures settled marginally lower on Saturday after recovering in the past two sessions as pace in arrivals across the India in pressurizing the prices and capping the upside. As on 4th November 2012, 13.02 lakh bales of Cotton has arrived so far, down by 29% compared to last year 18.57 lakh bales during the same period. ICE cotton futures corrected by 1.66% yesterday due to sufficient supplies. Also, weakness in the overall global economic situation kept prices under downside pressure Cotton harvesting has commenced in US, in all 64% is harvested as compared to 50% a week ago, versus 68% same period a year ago. Cotton crop condition is 43% in Good/Excellent state compared to 29% th same period a year ago as on 6 Nov 2012.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 970 16190

as on Nov 17, 2012 % Change Prev. day WoW 0.36 0.41 -0.06 0.68 MoM -4.34 0.68 YoY #N/A -4.54

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 72.73 81.35

as on Nov 16, 2012 % Change Prev day WoW -1.66 4.53 0.00 0.00 MoM -6.59 0.00 YoY -19.91 -29.20

Domestic Production and Consumption

According to Cotton Advisory Boards (CAB) latest estimates 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.

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Global Cotton Updates

The U.S. government has raised its 2012/13 forecast for global cotton inventory to above 80 million 480-pound bales for the first time due to larger-than-expected output in the United States, the world's third largest producer, and falling demand from China, the world's largest consumer. In its monthly crop report, the U.S. Department of Agriculture increased its estimate for 2012/13 ending stocks for a fourth straight month to a new all-time high of 80.27 million bales. Higher global ending stocks are seen capping the upside in the cotton prices this year too. However, downside is also limited as prices are again nearing its 12 year average price of 65 cents per pound. Markets will now take cues from the Chinese demand for cotton and trade policies of India with respect to cotton exports. In its November monthly demand supply report, the Agriculture Department (USDA) raised its cotton crop for 2012/13 cotton crop season to 17.45 mln bales (Prev 17.29) along with upward revision in end stocks 5.80 mln 480 pounds/bales (Prev 5.60). Exports were unchanged at 11.60 mln 480 pounds/bales.

Source: Telequote

Technical Chart - Cotton

MCX Nov contract

Source: Telequote

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

valid for Nov 19, 2012 Support 945-957 948-960 15920-16050 Resistance 980-991 982-993 16320-16430

Outlook
Cotton prices might trade sideways with downward bias as harvesting pressure is weighing on the prices, but still no major downside is expected in the domestic markets as farmers will not sell their stocks at very low prices. Also, CCI procurement at MSP levels may support prices from falling sharply.

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