Commodities Daily Report

Thursday| November 22, 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
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Commodities Daily Report

Thursday| November 22, 2012

Agricultural Commodities
News in brief
UP govt to announce cane prices today; 15% hike likely
The Uttar Pradesh government is likely to increase cane prices by 15%. According to sources, the government has almost made up its mind to hike the cane prices by approximately 15% over last year. The government is also contemplating incentives for millers so as to blunt the pinch of the hike, which would mean that the hike would be in the bracket of around Rs 25-30 per quintal. The chief minister was apprised of the situation at a meeting on Wednesday, said an official privy to the development. He also said the chief minister is considering on the incentives and will make an announcement on Thursday. Sources confirmed the government was open to making changes in the excise policy to give more breathing space to millers. The changes can be in the shape of the government lifting the ban on the sale of free molasses of factories after setting aside the 20% reserved quota for country liqor.
(Source: Financial Express)

Market Highlights (% change)

Last Prev. day

as on Nov 21, 2012

WoW MoM YoY

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

18460 5615 55.12 87.38 1728

0.72 0.78 0.02 0.73 0.27

-0.85 -0.92 0.18 1.23 -0.09

-1.19 -1.22 2.36 -2.97 0.30

15.77 17.50 5.86 -9.84 2.96

Source: Reuters

Wheat firm ahead of US holiday as dryness persists

US wheat edged higher on Wednesday as dry conditions kept crop concerns in focus, but corn and soybeans slid in choppy trading the day before the US Thanksgiving holiday. Trading was light ahead of the break, leaving markets vulnerable to sudden changes earlier in the session. Chicago Board of Trade December wheat rose 0.2 percent, or 2 cents, to $8.47 per bushel by 12:06 p.m. CST (1806 GMT), shrugging off comments by Russia's deputy agriculture minister that Russian grain exports could reach 15.5 million tonnes in the current crop season. Fears about the declining condition of the US winter wheat crop underpinned prices. Dry weather and record-setting high temperatures are maintaining "severe stress" on hard red winter wheat from South Dakota to Texas, the US Department of Agriculture (USDA) said on Wednesday. "I'm surprised we're not getting more publicity out of the poor wheat conditions," said Jason Roose, vice-president at US Commodities. The USDA said on Monday its rating of the winter wheat crop fell to 34 percent good-toexcellent, below analysts' expectations, due to persistent dry conditions in the US Plains (Source: Business Recorder)

Sell excess wheat, share profit with farmers, says CACP

The government should liquidate wheat stocks through exports and sales in the open market and share the proceeds with farmers to raise their income levels, a government panel suggested. In its latest report to the agriculture ministry, the Commission for Agricultural Costs and Prices (CACP), which recommends a minimum support price (MSP) for agriculture crops, is said to have maintained that there is no reason to lift the suggested freeze on wheat MSP, a source said. The Union Cabinet had asked the CACP to review its earlier recommendation of not raising the MSP after the agriculture ministry suggested an upward revision to Rs 1,400 per quintal from the existing floor price of Rs 1,285 per quintal. The review was sought in the wake of an increase in input cost such as diesel prices. "The commission has a view that the wheat's cost of production is very well covered within the earlier recommended unchanged MSP of Rs 1,285 per quintal. Even the rise in diesel prices makes no difference. The market price of wheat is above the MSP and the need is to sell the swelling wheat stock and share the profit with farmers to benefit them," the source said. (Source: Economic Times)

Thai rice buy plan sends Indian exporters laughing to bank

For 30 years, Thailand has been the top rice exporter in the global market. But a decision last year by the Thai Government to buy paddy from farmers at a higher price of $450 has turned things topsy-turvy in the rice market. In turn, it has proved to be a blessing for India that reentered the rice export market in September last year after the Centre lifted a four-year ban. This year, India will be the top rice exporter. The Food and Agriculture Organisation and the US Department of Agriculture (USDA) that see India topping exports have pegged the shipment figures at nine million tonnes and 10 million tonnes, respectively. Thailands move to buy paddy at a price, that is a third higher than before, has effectively raised the price of rice to over $750 a tonne. This is set to see the Far-Eastern nation ending up behind Vietnam which, too, is trying to cash in on the current market situation. While India releases stocks, the Thai government is accumulating them by purchasing domestic supplies at above market prices, making exports uncompetitive, says the USDA.
(Source: Business Line)

Chana traders seek FMC probe into futures price movement

After guar and pepper, trading in chana futures is in the eye of a storm. A section of the trade is reported to have formed a cartel to perk up prices, leading to demand for a thorough investigation by the Forward Markets Commission (FMC). According to Pradeep Jindal of Delhi, a member of the , A group of cartel cornered all delivery of chana and now again it is buying large quantity and taking advantage. January contract are Rs 6,000 a tonne lower than November contract and exchange has 29,000 tonnes stocks in demat form. Instead of selling by the holder of the demat stock, they are cornering all the quantity. The difference, he said, is Rs 17.40 crore between November and January contract. The new Indian crop will come only from March 2013. This is the same as in the trading of guar and pepper, he told Business Line. He said that a cartel that is taking a huge position and manipulating market from certain participants and they are killing to hedger/arbitrator/small investor by cornering all deliveries. (Source: Business Line)

Rice exports may fall in 2013: FAO

The fall in rice production in the current crop year in India against rising domestic demand is expected to affect exports of the key staple in 2013, United Nation's body FAO has said. By contrast, the 2012 production shortfall and rising domestic needs may depress India's exports next year," Food and Agriculture Organisation (FAO) said in its latest Rice Market Monitor (RMM) report. The global body on the farm sector has pegged India's rice production to be lower at 100 million tonnes in the 2012-13 crop year (July-June) from record high of 104.32 million tonne in 2011-12 crop year. (Source: Financial Express)

Heavy rains likely in coastal AP next 2 days

The rainmaker low-pressure system in West-central and adjoining Southwest Bay of Bengal had one flank caressing coastal Andhra Pradesh on Wednesday. In this manner, the landfall process has begun in right earnest, an India Meteorological Department (IMD) update suggested. It is preparing to unleash heavy to very heavy rainfall at a few places over coastal Andhra Pradesh during next two days. A short-term forecast valid until Saturday said that rain or thundershowers would continue to occur at many places over coastal Andhra Pradesh. (Source: Business Line)

Drought No Obstacle to Record Income for U.S. Farms

Even after the worst drought in a half century shriveled crops from Ohio to Nebraska, U.S. farmers are having their most-profitable year ever because of record- high prices and insurance claims. (Source: Bloomberg)

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Commodities Daily Report

Thursday| November 22, 2012

Agricultural Commodities
Chana
Chana spot as well as futures extended the losses and settled lower by 2.21% on Wednesday on prospects of better sowing this Rabi season. 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.
Source: Telequote
th

Market Highlights
Unit Rs/qtl Rs/qtl Last 4453 4268 Prev day -2.21 -7.80

as on Nov 21, 2012 % change WoW MoM -3.19 -2.97 -9.25 -8.43 YoY 34.71 31.08

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

Source: Reuters

Technical Chart - Chana

NCDEX Dec contract

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.

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

valid for Nov 22, 2012 Resistance 4305-4345

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)

4185-4220

Outlook
Chana futures may remain under downside pressure on expectations of ease in supplies amid higher shipments coupled with subdued demand. However, short covering may be seen at lower levels as prices have declined considerably in the current week. 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

Thursday| November 22, 2012

Agricultural Commodities
Sugar
Sugar spot traded marginally lower as reports of upward revision in sugar production for 2012-13 season exerted pressure on the prices. However, futures settled marginally higher amid short coverings. Disputes over cane pricing is almost over and crushing is expected to start in full pace. 9.84 lakh tons of sugar has been produced in the current sugar season 2012-13 upto 15th November, 2012 that is 2 lakh tons higher to the production in the same period last year of 7.76 lakh tons. (Source: PIB) Maharashtra Finance Minister Jayant Patil on 18 Nov 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. According to sources, the UP Government may announce a hike of Rs 20-30 a quintal over the next few days against Rs 240 a quintal last season. Also, Tamil Nadu State Government for the 2012-13 season fixed State Advised Price (SAP) for a tonne of sugarcane at Rs 2,350 linked to a sugar recovery of 9.5 per cent from last season price of Rs 2,100 a ton. Further the Andhra Pradesh Government has asked the private and joint venture sugar factories in the State to consider the demand of sugar cane growers to pay Rs 3,000 a tonne of cane keeping in view of abnormal increase in cost of cultivation. Liffe white sugar as well as ICE raw sugar settled 1.13% and 1.31% lower on Wednesday as pick up in supplies from Brazil and pace in sugar crushing in Thailand pressurized the prices to trade on a negative note. 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.
th

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Nov '12 Futures Rs/qtl Last 3462

as on Nov 21, 2012 % Change Prev. day WoW -0.29 0.35 MoM -0.84 YoY 17.16

Rs/qtl

3293

-6.87

-4.58

0.06

14.86

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 518 436.44

as on Nov 21, 2012 % Change Prev day WoW -1.13 -1.31 -2.43 2.08 MoM -5.84 -2.09 YoY -15.62 -16.21

Source: Reuters

Technical Chart - Sugar

NCDEX Dec contract

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. 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.

Source: Telequote

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

valid for Nov 22, 2012 Resistance 3305-3320

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 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)

3248-3270

Outlook
Sugar prices may trade sideways with downward bias as upward revision in the production of sugar this season might pressurize the prices. Also sufficient supplies due to higher non-levy quota might cap the upside.

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Commodities Daily Report

Thursday| November 22, 2012

Agricultural Commodities
Oilseeds
Soybean: Soybean Dec futures traded on a negative note and
settled marginally lower yesterday as improved arrivals post Diwali are exerting to pressurize the prices. 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 Dec '12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Dec '12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3276 3253 716.9 705.4

as on Nov 21, 2012 % Change Prev day -1.06 -0.63 -0.23 -1.21 WoW -0.15 0.18 1.77 1.62 MoM 0.18 -2.08 2.97 2.18 YoY 37.59 35.83 6.03 3.88

International Markets
After falling sharply, CBOT Soybean witnessed sharp reversal and thus settled marginally lower by 0.32% on forecast of fall in production in South America and Brazil by Oilworld supported the upside. However reports of favorable weather in these countries in coming days might again ease the 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

as on Nov 21, 2012 International Prices Soybean- CBOTNov'12 Futures Soybean Oil - CBOTDec'12 Futures Unit USc/ Bushel USc/lbs Last 1408 48.53 Prev day -0.32 0.43 WoW -1.71 1.80 MoM -8.94 -6.06
Source: Reuters

YoY 22.67 -2.73

Crude Palm Oil

as on Nov 21, 2012 % Change Prev day WoW -1.22 0.02 5.03 1.14

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

Last 2340 435.1

MoM -2.21 -0.02

YoY -26.88 -14.84

MYR/Tonne Rs/10 kg

Refined Soy Oil: Ref soy oil traded on a positive note due to
increasing demand for the edible oil. MCX CPO traded marginally higher yesterday tracking as the weak international BMD prices amid fall in exports, is capping any upside. Exports of Malaysian palm oil products for Nov. 1-20 fell 3.8 percent to 1,010,417 tonnes compared with 1,050,548 tonnes shipped during Oct. 1-20According 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.

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Dec'12 Futures Rs/100 kgs Rs/100 kgs Last 4193 4155 Prev day -2.50 -1.05

as on Nov 21, 2012 WoW -2.50 -1.96 MoM -0.18 -2.67

Source: Reuters

YoY 26.09 21.35

Technical Chart Soybean

NCDEX Dec contract

Rape/mustard Seed: Rm seed futures settled lower by 1.21% as

prospects of better sowing is putting downside pressure on the th prices. 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 sideways with negative bias today on expectations of arrivals to improve in the current week might pressurize the prices. 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 22, 2012 Support 694-701 3190-3215 4068-4100 430-437 Resistance 711-718 3280-3312 4190-4230 445-450

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Commodities Daily Report

Thursday| November 22, 2012

Agricultural Commodities
Black Pepper
Pepper futures corrected sharply yesterday due to skepticism over 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 the Futures settled 2.3% and 3.72% lower on Tuesday. Pepper prices in the international market are being quoted at $7,750/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 Dec '12 Futures Rs/qtl Rs/qtl Last 38758 37610 % Change Prev day -2.30 -4.36

as on Nov 21, 2012 WoW -5.85 -9.23 MoM -8.34 -14.78 YoY 8.17 3.42

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 22, 2012 Support 36800-37200 Resistance 37880-38150

Production and Arrivals

The arrivals in the spot market were reported at 4 tonnes while offtakes were 3 tonnes on Wednesday. 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 trade downwards today. Liquidation pressure from farmers as well as low export demand may pressurize prices. Reports that FMC is probing into complaints against price movement 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

Thursday| November 22, 2012

Agricultural Commodities
Jeera
Jeera Futures opened higher due to short coverings but corrected again towards the end tracking the ongoing sowing of the crop. The sowing is expected to gain momentum in the coming days, and have pressurised prices. However, export demand supported prices in the spot markets. 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 reopened after Diwali holidays and settled 0.24% higher while the Futures settled 0.59% lower on Wednesday. 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 Dec '12 Futures Rs/qtl Rs/qtl Last 15100 14760 Prev day 0.24 1.99

as on Nov 21, 2012 % Change WoW 0.24 0.54 MoM 0.17 -2.40 YoY 4.30 0.76

Source: Reuters

Technical Chart Jeera

NCDEX Dec contract

Production, Arrivals and Exports

Unjha markets witnessed arrivals of 5,000 bags, while off-takes stood at 5,000 bags on Wednesday. Production of Jeera in 2011-12 is expected to be around 40 lakh bags as compared to 29 lakh bags in 2010-11 (each bag weighs 55 kgs). (Source: spot market traders). According to Spices Board of India, exports of Jeera in April 2012 stood at 2,500 tonnes as compared to 2,369 tonnes in April 2011, an increase of 6%.
Source: Telequote

Market Highlights
Prev day 0.55 -1.51

as on Nov 21, 2012 % Change

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

Last 5060 5080

WoW -0.03 -5.96

MoM 0.78 -0.51

YoY -4.87 9.39

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.

Turmeric
Turmeric Futures opened lower yesterday but recovered towards the end of the session due to short covering at lower levels. Prices have corrected from higher levels over the last couple of sessions due to weak overseas demand. Stockists have good carryover stocks with them. The spot also remained weak. 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 well as the Futures settled 0.55% and 1% higher on Wednesday. Production, Arrivals and Exports Arrivals in Erode and Nizamabad mandi stood at 6,000 bags and 800 bags respectively on Wednesday. Turmeric production for the year 2011-12 is projected at historical high of 90 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 201011. Erode is expected to produce 55 lakh bags of turmeric a rise of 29% as compared to previous year. According to Spices Board of India, exports of Turmeric in April 2012 increased by 1% at 7,300 tn as compared to 7,230 tn in April 2011. Outlook Turmeric prices are expected to trade on a mixed note with a negative bias 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.

Technical Chart Turmeric

NCDEX Dec contract

Source: Telequote

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

Valid for Nov 22, 2012

Support 14420-14600 4980-5030 Resistance 14890-15020 5136-5180

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Commodities Daily Report

Thursday| November 22, 2012

Agricultural Commodities
Kapas
NCDEX Kapas futures settled marginally lower by 0.15% on the back of improved arrivals that are pressurizing the prices. 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 settled lower by 0.17% on account of supply glut in the global markets. Cotton harvesting has commenced in US, in all 84% is harvested as compared to 75% a week ago, versus 85% 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 20 Nov 2012.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 974.5 16230

as on Nov 21, 2012 % Change Prev. day WoW -0.61 0.00 -0.25 0.37 MoM -2.55 0.37 YoY #N/A -2.52

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 72.38 81.35

as on Nov 21, 2012 % Change Prev day WoW -0.17 1.05 0.00 0.00 MoM -5.91 0.00 YoY -19.53 -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

Outlook
Cotton prices might trade sideways as harvesting pressure is weighing on the prices. However, 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.

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 22, 2012 Support 950-962 955-965 15950-16080 Resistance 983-994 986-998 16320-16450

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