Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities

Content
News & Market Highlights Chana Sugar Oilseed Complex Spices Complex Mentha Potato

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

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Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities
News in brief
Spurt in Rains Boosts Pulses Acreage
Late rains in Rajasthan are likely to play a key role in determining the pulses acreage vital for ensuring protein content in the diet of the average Indian. In the past few days, a spurt in rains in western Rajasthan has accelerated pulses sowing in the state, kindling hopes of recovering pulses acreage deficit. According to the latest sowing data, the total coverage under pulses is 74.48 lakh hectare as against 89.34 lakh hectare last year in the corresponding period. Out of the overall deficit of 14.86 lakh hectare, Rajasthan alone accounts for 12.6 lakh hectare. (Source: The economic times)

Market Highlights (% change)

Last Prev. day

as on Aug 10, 2012

WoW MoM YoY

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

17558 5320 55.28 92.87 1620

-0.02 -0.05 0.20 -0.52 0.16

2.09 2.01 -0.84 1.61 0.85

0.39 0.27 -0.43 8.23 2.83

3.34 3.94 22.94 14.22 -5.29

Source: Reuters

Soyabean farmers in M.P. switching to urea as DAP costs shoot up

Farmers in the countrys largest soyabean producing State, Madhya Pradesh, have started using urea instead of diammonium phosphate (DAP) in its cultivation due to the rising prices of fertilizers. Urea prices are comparatively controlled; thats why farmers are using it as compared to other fertilizers, Krishak Bharati Cooperative Ltds Director (Marketing), N. Sambasiva Rao, told PTI. In this kharif season, we are finding it hard to buy fertilizers because their costs have increased immensely. In 2011, a 50-kg sack of DAP cost Rs 860. It has increased to Rs 1,272 now, said a farmer from Indores Daulatabad region. This year, consumption of DAP and super phosphate will be 30-40 per cent less because their prices have risen more than other fertilizers, he added. Rao attributed the rise in fertilizer prices to rupee depreciation against the US dollar which has increased import costs of fertilizers. However, experts say that for a good harvest, right time and right mix of fertilizers is necessary. (Source: Business line)

Soya, Sunflower Oil Prices to Rise Due to Festivals

The US Department of Agriculture (USDA) report on low soya bean production has set on fire the soya oil market, with prices moving upwards to $1,270 per tonne from $1,230 per tonne on Friday. Sunflower oil, which India imports from Black Sea countries, has also seen an upward trend and is trading at the same level as soya oil. Traders in India say soya and sunflower oil will become costlier in the upcoming festival season as a large portion of demand will have to be met through imports. The Indian crop will enter the market by October end as the late monsoon has delayed harvesting. USDA has forecast soya bean production at 2.69 billion bushels, a 12% decline from last year. The expected yields of an average of 36.1 bushels per acre would be the lowest since 2003. BV Mehta, ED of the Solvent Extractors Association, said: The scenario is not very good in India and abroad. Soya bean has been sowed in India but if rains do not continue till October, the yield will come down affecting production. Groundnut and sunflower sowing has been affected as there has been little rain in Karnataka and Maharashtra. Overall, prices of edible oil in the country will remain on the higher side.
(Source: The Economic Times)

Dairies see milk procurement going up 10-25% in areas hit by dry spell
The prevailing drought-like situation in parts of the country has led to farmers selling more milk in the market. This is reflected from the 10-25 per cent rise in milk procurement that co-operatives and corporates have registered largely from the dry-spell hit areas. Farmers tend to sell more of milk, which becomes the only source of income when crops are hit by poor rains, Sodhi said. The average daily milk procurement by GCMMF stood at 10.30 million kg in 2011-12. He estimates the countrys overall milk production to sustain a growth of 3-4 per cent this year too. The Government is yet to officially announce milk production numbers for 2011-12, while the output stood at 122.8 million tonnes for 2010-11.
(Source: Business Line)

Govt Looks to Expand Food Security Cover

It may become UPA plank for 2014 polls and may cost . 1.18 lakh crore The food ministry has submitted a Plan B for the proposed Food Security Bill to the parliamentary standing committee for consideration, a source in the food ministry said. The new plan, which has reportedly received clearance from the prime minister, will provide food to a larger cross-section of population than originally thought. The original Food Security Bill aimed at providing subsidised wheat and rice to over 63.5% of the countrys population. The Plan B aims to cover 67% of the population. The Plan B simplifies the allocation math by suggesting a uniform food grain quota of 5 kg per person per month for the entire 67% population of the country. The new plan also suggests giving states the power to identify beneficiaries according to their own criteria, ruling out any difference with the central government in this regard. The Centre may frame a guideline which would guarantee food for persons spending less than Rs 40 in rural areas and 50 in urban areas per day. The new plan will involve a subsidy burden of 1.18 lakh crore for pan-India rollout compared to 1.11 lakh crore for the original plan. The difference is about 7,000 crore, which matches with the amount the government plans to spend on giving a mobile phone to every BPL family.
(Source: The economic Times)

Govt to enhance seed subsidy under drought management programme

The agriculture ministry has in-principle agreed to enhance the seed subsidy under its drought management programme. Cereals, coarse cereals including fodder crops, pulses and oilseeds covered under various schemes of the ministry, will benefit from this subsidy. In view of the deficient rains, this will be applicable for all states where the ministry is implementing its various schemes. The amount of seed subsidy has been enhanced from Rs 800 to 1,000 per quintal for coarse cereals, including millets used for fodder, from Rs 500 to Rs 700 per quintal for cereals and from Rs 1,200 to Rs 2,000 per quintal for pulses and oilseeds. Some of the major schemes, which will allocate this enhanced subsidy component to the states, are Rashtriya Krishi Vikas Yojana, National Food Security Mission, Micromanagement of Agriculture, Initiative for nutritional security through intensive millets, Integrated scheme for oilseeds, pulses, oilpalm and maize and Bringing Green Revolution in Eastern India.
(Source: Business Standard)

Sugar output in India set to fall on dry weather, says Kingsman

Sugar output in India, the world's second-biggest producer, may be less than forecast next year as a drought threatens to cut yields in some areas, lowering exports, broker Kingsman SA said.Production may total 25 million tonnes in the year starting October 1, compared with 25.5 million tonnes forecast in June, Kingsman said. The estimate matches those by the Indian Sugar Mills Association and the National Federation of Cooperative Sugar Factories Ltd. Output this year is set to total 26 million tonnes, it said. (Source: Business Standard)

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Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities
Chana
Chana futures traded on a positive note last week due to lower sowing of kharif pulses. Tight supplies coupled with good demand for Chana ahead of the upcoming festive season is also supporting the prices. Fears that the government might take action and may impose stock limits to curb the rising prices led a correction in the spot. The spot settled 1.72% lower while the Futures settled 0.78% lower w-o-w. As per the latest report form IMD, monsoon till 08 August 2012 were 17% below normal with Rajasthan, Gujarat, Punjab and Haryana affecting the most. This has led to concerns over kharif pulses output as Rajasthan accounts for 25% of the kharif pulses production. Also, poor rains would impact Rabi chana sowing where Rajasthan contributes around 12-13% in total chana output. The Cabinet Committee on Economic Affairs yesterday approved the Minimum Support Prices (MSP) for Arhar (Tur) and Moong for 2012-13 season. The MSP for Arhar has been fixed at Rs.3850 per quintal and of Moong at Rs.4400 per quintal marking an increase of Rs.650 per quintal and Rs.900 per quintal respectively. Government released fourth advance estimates wherein it revised upward Chana output at 7.58 mn tn from 7.4 mn tonnes estimated in the third advance estimates and 8.22 mn tn in 2010-11.
th

Market Highlights
Unit Rs/qtl Rs/qtl Last 4914 4809 Prev day 0.06 0.75

as on Aug 11, 2012 % change WoW MoM -1.72 3.13 0.78 3.98 YoY 52.68 45.20

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

Source: Reuters

Technical Chart - Chana

NCDEX Sept contract

Sowing progress and demand supply fundamentals

According to the Ministry of Agriculture 74.48 Lakh hectare area has th been planted under Kharif pulses as on 9 August, 2012 compared to 89.34 lakh hectare (ha) same period last year, a decline of 16.63% . Sowing is reported lower mainly in Rajasthan. Rajasthan Agriculture Department states that planted area under Kharif Pulses is down at 8.93 lakh hectares ha compared to 19.35 lakh ha same st period last year. (Dated 1 August, 2012). Acreage may remain lower as farmers in Rajasthan may shift to other lucrative crops. However, in AP and Maharashtra, Kharif sowing is up by 5% and 0.2%. According to the Fourth advance estimates, Pulses output is pegged at 17.21 mn tn in 2011-12 compared with 18.24 mn tn produced in the year 2010-11. While Chana output in 2011-12 is estimated at 7.58 million tones, Tur is estimated at 2.65 million tones, Urad is estimated at 1.83 million tones, Moong is estimated at 1.71 million tones. As per the latest release, Ministry of Commerce & Industry revealed that 20.23 lakh tones of peas, 2.03 lakh tons of Chana, 4.32 lakh tons of Urad & Moong, 1.12 lakh tons of Masoor and 4.26 lakh tons of Tur has been imported by India during April11-March 12. India's consumption of pulses is on the rise with an annual growth of around 5% but production is seen lower, which may lead to increase in imports this year. However, rupee weakness may turn import costlier. Around 74% of Indian chickpea imports come from Australia.
Source: Telequote

Technical Outlook
Contract Chana Sept Futures Unit Rs./qtl

valid for Aug 13, 2012 Support 4780-4835 Resistance 4925-4965

Outlook
Chana prices may are expected to continue to trade on a positive note on output concerns in kharif pulses. Tight supplies as well as strong demand amid festive season may also lend support to the prices. Further, poor rains in Rajasthan, and thereby concerns over chana sowing over there is also supporting the upside in the prices. However, if government takes some measure to curb the rising prices of Pulse, like imposition of stock limits, prices might come under downside pressure. In the medium term to long term, the trend remains positive as supplies may not be sufficient to meet the rising demand of the commodity. Also lower sowing of kharif pulses may support chana prices.

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Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities
Sugar
Sugar prices corrected last week on account of profit booking. Also, reports that the government may release additional sugar to arrest the rise in prices ahead of the festive season also led to the correction. The Spot as well as the Futures settled 3.06% and 2.51% lower w-o-w. Industry body has estimated 7 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may exports 2.53 mn tn sugar in 2012-13. (Source: Reuters) The Central Government has released additional 4 lakh ton of non-levy sugar for the month of August, 2012. With the earlier release of 45 lakh ton in June and 2.66 lakh ton in July the total 51.66 lakh ton non-levy sugar will be available. According to a circular issued by FMC a Minimum Initial Margin of 10% of the value of the contract or VaR based margin whichever is higher will be imposed on all running contracts and yet to be launched contracts of Sugar with effect from beginning of trading day Monday, Aug 06, 2012. In the international markets Liffe white sugar as well as ICE raw sugar settled 0.52% and 0.29% lower Friday.

Market Highlights
Unit Sugar Spot- NCDEX (Kolkata) Sugar M- NCDEX Aug '12 Futures Rs/qtl Last 3800

as on Aug 11, 2012 % Change Prev. day WoW -2.94 -3.06 MoM 9.91 YoY 25.41

Rs/qtl

3532

-0.98

-2.51

9.35

28.76

Source: Reuters

International Prices
Unit Sugar No 5- LiffeOct'12 Futures Sugar No 11-ICE Oct '12 Futures $/tonne $/tonne Last 578.5 460.89

as on Aug 10, 2012 % Change Prev day WoW -0.52 -0.29 -5.10 -5.73 MoM -11.00 -7.78 YoY -21.38 -24.53

Domestic Production and Exports

As on 9 August, 2012, the area under sugarcane is estimated at 52.88 lakh ha, up from 50.59 lakh ha on same period a year ago. Despite of higher acreage, the producers body has estimated next years output lower at 25mn tn, down by 1mn tn compared to the current year. Sugar production in India the worlds second-biggest producer touched 26 million tonne since October 1, 2011. IMD has so far predicted normal rains in August. However, rains in the first week of august are still 1% below average. If monsoon recover in the month of August, then there would not be much downward revision in the output and vice a versa. With the opening stocks of 7 mn tonnes, domestic Sugar supplies are estimated at 32mn tn against the domestic consumption of around 22.523 mln tn for 2012-13 season. Thus, no curbs on exports are seen as of now.
th

Source: Reuters

Technical Chart - Sugar

NCDEX Sept contract

Global Sugar Updates

According to Unica, Mills in Brazil's main center-south cane region produced 9.32 mn tn of sugar since April, down 22 percent from a year ago, With a return to a normal weather pattern, cane harvesting is in full swing. While sugar output reached 2.63 mn tn in the first two weeks of July, up 2% from a year ago. Brazil's exports of raw sugar fell to 1.29 million tonnes in June, down by 30% from 1.85 million tonnes a year earlier. The global sugar surplus remains on target to fall in 2012/13 season, though declines will be less than previously suggested, while adverse weather in several producers may stop prices dropping far below recent levels. (Source: Reuters) According to the International Sugar Organization (ISO), the global sugar surplus is forecast to halve to around 3 mln tn in 2012/13 (OctoberSeptember) from a surplus of 6.5 million tonnes in 2011/12).

Source: Telequote

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

valid for Aug 13, 2012 Support 3425-3455 Resistance 3520-3540

Outlook
Sugar prices are expected to trade on sideways to positive in the intraday. Festive season demand and comparatively lower supplies may support the prices. However, any action by the government to control the rising prices may lead to a correction in the prices. Long term outlook for sugar would depend on the monsoon in the month of August and September and thereby output estimates for next season that will begin in October.

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Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities
Soybean futures traded on a bullish note last week ahead of the USDA monthly crop report. However, the prices corrected towards the end of the week of profit booking as well as rains in the soybean belt in Madhya Pradhesh. The Spot as well as the Futures settled 2.77% and 2.43% higher w-o-w. India's oil meal exports fell to 2.75 lakh tn in July from 2.82 lakh tn a year earlier led by a sharp drop in the overseas sales of rapeseed meal. Soy meal exports rose to 1.68 lakh tn in July, from 1.39 tn a year ago. The only factor that is supporting the upside in the coming week is the USDA report which I expected to be released on Friday. In the international markets CBOT Soybean traded on a bullish note as the USDA released its monthly crop report. USDA cut its U.S. 2012/13 soybean production forecast to 2.692 billion bushels, from 3.05 billion in July. Continued export demand from China added support. CBOT Soybean settled 0.89% higher on Friday. th In the domestic markets, as on 9 August Oilseeds have been sown in 151.82 lakh hectares so far, compared with 157.9 lakh hectares same period last year. Soybean area is higher at 103.2 lakh hectares. In 2011-12 season, soybean was sown under 102.9 lakh hectares area and recorded 12.28 million tonne output, down from 12.73 mn tn in 2010-11 season. Indian acreage may touch record high levels this year as farmers have opted for this remunerative crop across India.

Oilseeds Soybean:

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Aug'12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soyoil- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 4597 4613 777.2 776.1

as on Aug 11, 2012 % Change Prev day 0.28 -0.94 0.47 0.23 WoW 2.77 2.43 -0.57 -1.28 MoM 0.17 0.32 -1.13 -1.63 YoY 93.72 93.58 17.44 18.01

Source: Reuters

as on Aug 10, 2012 International Prices Soybean- CBOTAug'12 Futures Soybean Oil - CBOTAug'12 Futures Unit USc/ Bushel USc/lbs Last 1710 53.6 Prev day 0.89 2.31 WoW 3.22 3.00 MoM 11.57 2.72
Source: Reuters

YoY 23.92 -6.46

Crude Palm Oil

% Change Unit
CPO-Bursa Malaysia Aug '12 Contract CPO-MCX- Aug '12 Futures

as on Aug 11, 2012

Refined Soy Oil: NCDEX Soy Oil and MCX CPO corrected last week
due to higher stocks in Malaysia. Lower exports also led to a correction in the prices. Malaysian supplies are higher due to seasonally higher yield during the period (July-October). Malaysian palm oil Production has risen consistently since March 2012 and expected to go as high as 1.9 mn tn in September. On the other hand, exports have fallen 14.8 percent in July to below 1.23mn tonnes compared to 1.45mn tonnes a month ago due to a lull in Asian demand. India imported 124,125 tonnes of refined palm oil in June, down nearly 25 percent from May. Total vegetable oil imports in June were 783,315 tonnes, down 12.7 percent from 896,921 tonnes in the previous month, the data from the Solvent Extractors' Association (SEA) showed.

Last 2830 555.5

Prev day 0.46 0.34

WoW -2.31 -1.99

MoM -7.30 -1.77

YoY -16.76 14.09

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Aug '12 Futures Rs/100 kgs Rs/100 kgs Last 4275 4327 Prev day 1.79 -0.51

as on Aug 11, 2012 WoW -1.84 -2.21 MoM 1.79 2.24

Source: Reuters

YoY 45.41 48.13

Rape/mustard Seed: NCDEX mustard seed prices corrected last

week due to lower mustard meal exports. The Futures settled 2.21% lower w-o-w. Mustard output this season has declined significantly and deficient rains Rajasthan would not provide proper moisture for mustard sowing next season. This would keep the downside restricted. According to a circular issued by NCDEX, existing Special Cash Margin of 5% on the Long side shall be increased to 15% on all the running and yet to be launched contracts w.e.f beginning of 18/07/2012.

Technical Chart Soybean

NCDEX Oct contract

Outlook
Soybean prices may trade sideways in the intraday. Downside pressure may persist on account of higher area under cultivation and expected higher yield of soybean due to good rains in MP. Nevertheless, sentiment remains cautious as the soybean crop in the US has suffered severe damage and thus USDA report to be released on Friday may show downward revision in output. Also, the possibility of an El Nino returning to Southeast Asia could hamper output in top producers Indonesia and Malaysia.
Source: Telequote

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

valid for Aug 13, 2012 Support 77-781 3885-3925 4318-4345 546-549 Resistance 790-794 4030-4075 4405-4435 556-560

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Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities
Black Pepper
Pepper Futures traded on a positive note last week due to dwindling stocks in the domestic markets, which lent support to the prices at lower levels. However, lower demand for Indian pepper in the international markets capped sharp upside movement. The Spot as well as the Futures settled 0.14% and 3.59% higher w-o-w. th According to the circular released on June 13 2012 the existing Special margin of 10% (cash) on the long side stands withdrawn on all running contracts and yet to be launched contracts in Pepper from beginning of day Friday June 15, 2012. Pepper prices in the international market are being quoted at $8,400/tonne(C&F) while Vietnam was offering its produce at $6,000/tonne for 500 GL. Brazil was offering its pepper at $6,150/tonne for the B-Asta grade. As per circular dt. 29/06/2012 issued by NCDEX, Hassan will be available as an additional delivery centre for all the yet to be launched contracts. (not applicable to the currently available contracts-till Dec 2012 expiry).

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 42933 45250 % Change Prev day 0.35 1.42

as on Aug 11, 2012 WoW 0.14 3.59 MoM 2.01 5.65 YoY 33.48 35.75

Source: Reuters

Technical Chart Black Pepper

NCDEX Sept contract

Exports
According to Spices Board of India, exports of pepper in April 2012 fell by 47% and stood at 1,200 tonnes as compared to 2,266 tonnes in April 2011. India imported 1,848 tonnes of pepper till March 2012 and has become the third country to import such large quantity after UAE and Singapore. (Source: Agriwatch) According to Vietnam Ministry of Agriculture and Rural Development (MARD) exports of black pepper in 2012 are forecasted at around 1,25,000 tonnes. Exports of Pepper from Vietnam during January till June 2012 is estimated around 73000 mt 73,000 mt, higher by 4.3% in volume and 31.7% in value compared to corresponding year last year. Exports of Pepper from Brazil during January till May 2012 are estimated around 13369 mt. (Source: Peppertradeboard). Pepper imports by U.S. the largest consumer of the spice declined 14.8% in the first 2 months of the year (2012) to 8810 tn as compared to 10344 tn in the same period previous year. Imports of Pepper in the month of February declined by 16.8% to 3999 tn as compared to 4811 tn in the month of January 2012. Exports from Indonesia posted significant decrease of 42% as compared to previous year. Exports stood at 36,500 tonnes as compared to 62,599 tonnes in the last year. During May 2012 Brazil exported 1,705 tonnes of pepper as against 1600 tn in May 2011.

Source: Telequote

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

valid for Aug 13, 2012 Support 43200-43650 Resistance 44250-44650

Production and Arrivals

Arrivals of pepper in domestic market stood at 21 tonnes while offtakes were 20 tonnes on Saturday. Global Pepper production in 2012 is expected to increase 7.2% to 3.20 lakh tonnes as compared to 2.98 lakh tonnes in 2011 with sharp rise of 24% in Indonesian pepper output and in Vietnam by 10%. According to latest report pepper output in Vietnam is estimated to be 1.35 lakh tonne as compared to 1.10 lakh tonne estimated early in the beginning of year (2012). Domestic consumption of Pepper in the world is expected to grow by 3.03% to 1.25 lakh tonnes while exports are likely to grow by 1.48% to 2.46 lakh tonnes in 2012. (Source: Pepper trade board) On the other hand production of pepper in India in 2011-12 is expected to decline further by 5% to 43 thousand tonnes as compared to 48 thousand tonnes in the last year. Production is lowest in a decade.

Outlook
Pepper prices in the intraday trade sideways to positive note as lower stocks in the domestic markets as well as buying ahead of the festive season may support prices. On the other hand reports of fresh arrivals from the Indonesia and Malaysia might cap sharp gains in the short term.

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Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities
Jeera
Jeera Futures corrected last week on fears that the regulator may take some action to curb the volatility. The spot prices also witnessed a downside movement as export demand reduced due to very high prices. Farmers are not selling their stocks anticipating better prices. Supply concerns from Syria and Turkey still exists. The spot as well as the Futures settled 1.72% and 5.53% lower w-o-w. Expectations are that large export orders may be diverted to India from the international markets due to the ongoing civil war in Syria which is hampering supplies. Export demand from Bangladesh, Pakistan and other countries may support the prices at lower levels. Production in Syria and Turkey is being reported around 1,000 tonnes and around 5,000 tonnes, lesser than expectations. Jeera prices in the international market of Indian origin are being offered at $3,000/tn (c&f) while Syria and Turkey are not offering their produce. Carryover stocks of jeera in the domestic market is expected to be around 7-8 lakh bags as compared to 4-5 lakh bags in the last year.

Market Highlights
Prev day 0.00 -2.01

as on Aug 11, 2012 % Change Unit Last 16294 15618 WoW -1.72 -5.53 MoM 5.21 2.63 YoY 5.12 1.92

Jeera SpotNCDEX(Unjha) Jeera- NCDEX Aug '12 Futures

Rs/qtl Rs/qtl

Source: Reuters

Technical Chart Jeera

NCDEX Sept contract

Production, Arrivals and Exports

Unjha markets witnessed arrivals of 4,000 bags, 2,000 bags lower compared to previous day while off-takes stood at 3,000 bags on Thursday. 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 -1.88

as on Aug 11, 2012 % Change

Outlook
Jeera prices are expected to trade sideways today. In the medium to long term (Aug-September 2012) prices are likely to witness a bounce back as there are limited stocks with Syria and Turkey and crop there is 30% short as compared to last year.
Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 5481 5518

WoW 3.43 -7.88

MoM 16.68 10.67

YoY -13.59 -4.13

Turmeric
Turmeric witnessed a sharp correction last week after the after the regulator disallowed creating of fresh positions in the August contract. However, the spot remained positive due to lower sowing this season. Erode mandi remained closed towards the end of the week on account of Janmasthmi, a local festival and will reopen on Monday. Rainfall in Nizamabad is 24% lower than the normal as on 1/8/2012. Turmeric th has been sown in 0.44 lakh hectares in A.P as on 8 August 2012. The Futures settled 0.18% higher on Friday. As per circular issued by NCDEX, no fresh positions will be allowed in respect of Turmeric August 16, 2012 expiry contract from August 07, 2012 till the expiry of the contract. Only squaring up of existing positions will be allowed. The pre expiry margin on Turmeric has been increased to 5% for last 7 trading days increased on a daily basis on both buy and sell side from the existing 3% on daily basis for last 5 days.

Technical Chart Turmeric

NCDEX Sept contract

Production, Arrivals and Exports

Arrivals in Nizamabad mandi stood at 2,000 bags on Thursday. Turmeric production for the year 2011-12 is projected at historical high of 90 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 201011. Erode is expected to produce 55 lakh bags of turmeric a rise of 29% as compared to previous year. According to Spices Board of India, exports of Turmeric in April 2012 increased by 1% at 7,300 tn as compared to 7,230 tn in April 2011.

Source: Telequote

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

valid for Aug 13, 2012 Support 15620-15725 5465-5536 Resistance 15980-16100 5730-5810

Outlook
Turmeric prices are expected to continue to trade lower as participants may square off their positions in the August contract after the regulator disallowed creating of fresh positions. In the medium to long term (Aug to September) prices may take cues from the sowing figures.

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Commodities Daily Report

Monday| August 13, 2012

Agricultural Commodities
Mentha Oil
Mentha oil Futures corrected last week due to lower export demand as export demand has been met. Also, gutkha ban led to lower demand in the domestic markets. Increasing supplies in the domestic markets also pressurized the prices. The spot as well as the Futures settled 0.21% and 6.37% lower w-o-w. Total Special Cash margin of 25% on the long side of Mentha Oil has been reduced to 10% in the May contract and 5% in June contract onwards from May 5, 2012. For detailed reference please refer to the Circular No: MCX/T&S/180/2012 dated 03/05/2012.

Market Highlights
Prev day -0.69 -3.92

as on Aug 11, 2012 % Change Unit Last 1524 1311 WoW -0.21 -6.37 MoM 9.48 -1.90 YoY 25.08 7.57

Mentha Oil- MCX Spot (Chandausi) Mentha Oil MCX July Futures

Rs/qtl Rs/qtl

Source: Reuters

Production, Arrivals and Exports

According to spot market sources, the overall acreage is estimated to increase from 1.75 lakh ha to 2.1 lakh ha this year. The overall production of Mentha is expected to increase by 30% - 40% as compared to last year. Arrivals of the fresh crop are going on in the mandis and currently stand around 1200 drums (each drum weighs 180 kgs). Exports of Mentha during April 2011 to January 2012 witnessed a decline of 6% to 12,850 tonnes as compared to 13,550 tonnes in the same period last year.

Technical Chart Mentha Oil

MCX Aug contract

Outlook
In the intraday trading session Mentha oil is expected to trade lower. Lower export demand may pressurize prices. However, buying at lower levels may emerge from stockists anticipating good demand from pharmaceutical companies may support prices at lower levels. In long to medium term (July-September) prices are likely to remain under pressure due to peak arrival period.

Source: Telequote

Market Highlights
Prev day 0.00 1.75

as on Aug 10, 2012 % Change

Potato
In intraday potato September futures settled lower owing to dull demand in the market. Commodity market regulator Forward Markets Commission (FMC) has banned launch of new Tarkeshwar potato contracts. Also From 01-08-2012 no fresh positions shall be allowed during the Staggered Delivery period in all running contracts of Potato in MCX and NCDEX. Only squaring off of existing positions will be allowed during the Staggered Delivery period.
Unit Potato SpotNCDEX (Agra) Potato- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 1155 1177

WoW -2.50 -2.41

MoM 6.09 1.15

YoY 174.55 219.58

Technical Chart Potato

NCDEX Sept contract

Production and Arrivals Scenario

Around 200-220 lakh MT potato had been stored in the country in different cold storages during the current season. Although 27-30% of the cold storage stocks are released so far from overall producing belts, they are much lower compared to normal 35-38% every year. According to NHRDF, The sowing of potato seed for Kharif production in Karnataka completed but the area sown is adversely affected due to less and delayed rains. The sowing in hills of Himachal Pradesh, Uttarakhand and Jammu and Kashmir are also completed. The seed sowing in Maharashtra for Kharif is continued, which is delayed due to delay arrival of monsoon, which is still scanty. The area for Kharif is expected to be less or may be same with delayed planting compared to last year, but it depends on further rains. With reports of crop damages in Karnataka, the supplies from this region to other states may also be affected as the overall output is expected to decline by 70-75%. In fact, the state may have to rely on the supplies from the north Indian markets.

Source: Telequote

Technical Outlook
Unit Mentha Oil Aug Futures Potato NCDEX Sept Futures Potato MCX Sept Futures Rs/kg Rs/qtl Rs/qtl

valid for Aug 13, 2012 Support 1282-1295 1152-1168 1183-1200 Resistance 1325-1340 1195-1208 1230-1250

Outlook
Potato futures in intraday may correct further on account of weak demand at higher levels, also the participants fear that the government may take some measures to curb the rising prices. Upcoming festive season might provide support to the prices in Medium term.

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