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Published on 8/06/2020 9:46:05 AM | Source: Kedia Advisory

Chana trading range for the day is 4154-4226 - Kedia Advisory

Posted in Commodities Reports| #Commodity Tips #Kedia Advisory

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Gold

Gold yesterday settled down by -2.14% at 45698 as hopes for a global economic rebound got a boost from stronger-than-expected U.S. non-farm payrolls data, reducing demand for safe havens. Gold was also being pressured by stronger yields and a slightly firmer dollar. The latest U.S. data showed a drastic fall in unemployment to 13.3% in May from 14.7% in April as layoffs abated. The data comes ahead of a two-day policy meeting of the U.S. Federal Reserve next week. The central bank has injected massive stimulus and cut interest rates to near zero to cushion the blow from the coronavirus pandemic. Hedge funds and money managers cut their bullish positions in COMEX gold and increased them in silver contracts in the week to June 2, the U.S. Commodity Futures Trading Commission (CFTC) said. Physical gold dealers in India offered the highest discounts in about two months as customers kept away with coronavirus cases in the country continuing to mount, while Singapore saw steady safe haven demand. In thin volume trade, discounts of up to $32 an ounce were offered over official domestic prices in India, the highest since early April. A few jewellers who had opened stores in May for a week were forced to shut again due to poor consumer response. In top consumer China, discounts eased to $11-$14 an ounce versus benchmark prices from last week’s $14-$18 discounts, with demand still lacklustre. Technically market is under long liquidation as market has witnessed drop in open interest by -5.43% to settled at 13512 while prices down -998 rupees, now Gold is getting support at 45227 and below same could see a test of 44756 levels, and resistance is now likely to be seen at 46363, a move above could see prices testing 47028.

Trading Ideas:

* Gold trading range for the day is 44756-47028.
* Gold prices dipped as hopes for a global economic rebound got a boost from stronger-than-expected U.S. non-farm payrolls data, reducing demand for safe havens.
* Gold was also being pressured by stronger yields and a slightly firmer dollar.
* The latest U.S. data showed a drastic fall in unemployment to 13.3% in May from 14.7% in April as layoffs abated.

 

Silver

Silver yesterday settled down by -2.99% at 47351 as better than expected U.S. jobs data prompted investors to seek riskier assets such as equities and pushed up the dollar. Data from the Labor Department showed U.S. non-farm payroll employment jumped by 2.51 million jobs in May after plummeting by a revised 20.69 million jobs in April. The unemployment rate dropped to 13.3% in May from 14.7% in April. The May payrolls report confounded economists who had predicted a job loss of 8 million in May as the coronavirus kept parts of the U.S. economy closed for a third straight month. China’s central bank injected 150 billion yuan ($21.10 billion) into the banking system through seven-day reverse repurchase agreements, while keeping the interest rate unchanged at 2.20%.The People’s Bank of China (PBOC) said in a statement fund injection was to counteract the impact from factors including maturing reverse repos and financial institutions’ reserve requirement payments, and in order to keep banking system liquidity “reasonably ample”. For the week, the PBOC drained a net 450 billion yuan ($63.29 billion), the biggest weekly net drain since mid-February, compared with 670 billion yuan of injection on a net basis a week earlier. Federal Reserve Chair Jerome Powell will testify before the U.S. Congress on June 16 and 17 in hearings on the central bank’s semi-annual monetary policy report. Technically market is under fresh selling as market has witnessed gain in open interest by % to settled at 10203 while prices down -1460 rupees, now Silver is getting support at 46744 and below same could see a test of 46136 levels, and resistance is now likely to be seen at 48295, a move above could see prices testing 49238.

Trading Ideas:

* Silver trading range for the day is 46136-49238.
* Silver prices fell sharply as better than expected U.S. jobs data prompted investors to seek riskier assets such as equities and pushed up the dollar.
* Data from the Labor Department showed U.S. non-farm payroll employment jumped by 2.51 million jobs in May
* China’s central bank injected 150 billion yuan ($21.10 billion) into the banking system through seven-day reverse repurchase agreements

 

Crude oil

Crude oil yesterday settled up by 6.14% at 2990 after OPEC decided to move up discussions on whether to extend record production cuts, indicating that some laggard countries may have agreed to align themselves with the deal. Support also seen amid optimism about increased energy demand after data from U.S. Labor Department showed unexpected job growth in the month of May. Further, traders were also betting on hopes OPEC will consider extending record production cuts beyond the end of this month. OPEC and its allies had said they would bring forward the meeting, which had been scheduled for next week, should Iraq and others agree to boost their adherence to existing supply cuts. Saudi Arabia and Russia, two of the world’s biggest oil producers, want to extend output cuts of 9.7 million barrels per day (bpd) into July. If OPEC+ fails to agree to roll over the current output curbs, that would mean the cut could drop back to 7.7 million bpd from July through December as previously agreed. According to sources from OPEC, Saudi Arabia and Russia have agreed to extend deeper cuts until the end of July. Meanwhile, according to a report from Baker Hughes, the number of active U.S. rigs drilling for oil declined by 16 to 206 this week, continuing to fall from mid-March, indicating further declines in domestic crude output. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 3158 while prices up 173 rupees, now Crude oil is getting support at 2875 and below same could see a test of 2759 levels, and resistance is now likely to be seen at 3052, a move above could see prices testing 3113.

Trading Ideas:

* Crude oil trading range for the day is 2759-3113.
* Crude oil prices rose after OPEC decided to move up discussions on whether to extend record production cuts.
* Support also seen amid optimism about increased energy demand after data showed unexpected US job growth in the month of May.
* Saudi Arabia and Russia, two of the world’s biggest oil producers, want to extend output cuts of 9.7 million barrels per day (bpd) into July.

 

Natural gas

Nat.Gas yesterday settled down by -1.59% at 135.8 on forecasts for milder weather and lower air conditioning demand in mid-June. The decline came despite an increase in liquefied natural gas (LNG) exports and concerns a tropical storm threatening the Gulf of Mexico could cut output. Tropical Storm Cristobal is expected to sweep across Louisiana's on- and offshore production areas over the weekend. Refinitiv said gas production in the U.S. Lower 48 states fell to an average of 88.6 billion cubic feet per day (bcfd) so far in June from a one-year low of 89.3 bcfd in May and an all-time monthly high of 95.4 bcfd in November. With the coming of milder weather in mid-June, Refinitiv projected U.S. demand, including exports, would rise from 81.2 bcfd this week to 82.2 bcfd next week before sliding to 81.6 bcfd in two weeks. The amount of pipeline gas flowing to U.S. LNG export plants was on track to reach 5.0 bcfd on Friday after dropping to a 13-month low of 3.7 bcfd Monday. That compares with an eight-month low of 6.4 bcfd in May and a monthly record high of 8.7 bcfd in February. Technically market is under fresh selling as market has witnessed gain in open interest by % to settled at 9059 while prices down -2.2 rupees, now Natural gas is getting support at 133.5 and below same could see a test of 131.3 levels, and resistance is now likely to be seen at 139.6, a move above could see prices testing 143.5.

Trading Ideas:

* Natural gas trading range for the day is 131.3-143.5.
* Natural gas slipped on forecasts for milder weather and lower air conditioning demand in mid-June.
* The decline came despite an increase in LNG exports and concerns a tropical storm threatening the Gulf of Mexico could cut output
* Tropical Storm Cristobal is expected to sweep across Louisiana's on- and offshore production areas

 

Copper

Copper yesterday settled up by 2.33% at 433.5 supported by a quicker-than-expected recovery in Chinese activity and hopes for a global economic rebound as some major countries reopened after months-long lockdowns. Copper consumption in top consumer China has been stronger than expected due to government stimulus and as businesses increased production to fulfil orders accumulated during the coronavirus-fuelled lockdowns. Some major countries in the west have also reopened their economies and unveiled more stimulus this week, boosting investor sentiment. The CME Group, decreased margins for copper contracts by 13.3%, effective after the close of business on Friday. The group lowered maintenance margins for COMEX June copper futures (HG) to $3,250 from $3,750 per contract. On-warrant stocks in LME-registered warehouses fell to 165,175 tonnes, their lowest since March 13, after 20,275 tonnes of cancellations. Inventories in Chinese visible warehouses have also fallen since March. The global world refined copper market showed a 131,000 tonnes surplus in February, compared with a 2,000 tonnes deficit in January, the International Copper Study Group (ICSG) said in its latest monthly bulletin. For the first 2 months of the year, the market was in a 129,000 tonnes surplus compared with a 29,000 tonnes surplus in the same period a year earlier, the ICSG said. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 3908 while prices up 9.85 rupees, now Copper is getting support at 425.9 and below same could see a test of 418.2 levels, and resistance is now likely to be seen at 438.4, a move above could see prices testing 443.2.

Trading Ideas:

* Copper trading range for the day is 418.2-443.2.
* Copper gained supported by a quicker-than-expected recovery in Chinese activity and hopes for a global economic rebound.
* On-warrant stocks in LME-registered warehouses fell to 165,175 tonnes, their lowest since March 13, after 20,275 tonnes of cancellations.
* Inventories in Chinese visible warehouses have also fallen since March.

 

Zinc

Zinc yesterday settled up by 1.77% at 164.3 as slow resumption of mines and optimism surrounding demand recovery and economic reopening supported prices. Global zinc concentrate market is very likely to be in a tight balance in 2020, compared to a slender surplus last year, as the production recovery from the Covid-19 crisis progresses slowly. New projects or expansion plans, on the other hand, are temporarily taken off the table as many experts warn that a full economic recovery from the pandemic could take years. China’s refined zinc output fell as expected in May, as fast declines in treatment charges (TCs) for domestic zinc concentrate depressed Chinese smelters production enthusiasm and led to output cut or maintenance at smelters in Hunan and Sichuan, showed the latest survey. Some smelters in Inner Mongolia, Yunnan, Guangxi and Gansu also carried out maintenance as scheduled, and smelters that recovered from maintenance in May were mostly located in Yunnan, Qinghai and Hunan. Inventories of zinc ingot across Shanghai-bonded areas registered a much smaller decline, as import losses widened sharply on a lower ratio of SHFE zinc prices to its LME counterpart. The stocks fell for a seventh straight week this week, decreasing 2,000 mt from a week earlier to 44,000 mt as of Friday June 5, showed data. The stocks dropped 8,800 mt last week. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 1924 while prices up 2.85 rupees, now Zinc is getting support at 161.8 and below same could see a test of 159.3 levels, and resistance is now likely to be seen at 166.1, a move above could see prices testing 167.9.

Trading Ideas:

* Zinc trading range for the day is 159.3-167.9.
* Zinc gained as slow resumption of mines and optimism surrounding demand recovery and economic reopening supported prices.
* Global zinc concentrate market is very likely to be in a tight balance in 2020, compared to a slender surplus last year.
* Inventories of zinc ingot across Shanghai-bonded areas registered a much smaller decline.

 

Nickel

Nickel yesterday settled up by 1.3% at 974.7 as the European Central Bank and German government announced big stimulus packages and U.S. data showed unemployment growth slowing sharply. The European Central Bank approved a bigger-than-expected expansion of its stimulus package to prop up an economy plunged by the pandemic. Indonesia will keep in place a ban on the export of nickel ore even as it relaxes exports of some other minerals under revisions to its mining law, the director of minerals at the country's energy and minerals ministry said. Indonesia's parliament passed revisions to its mining law last month, allowing miners building smelters to export ore for the next three years. But the revisions stipulated that the government can rule against the export of specific ores under a separate regulation. The global nickel market surplus narrowed to 14,000 tonnes in March from an upwardly revised 15,700 tonnes the previous month, the International Nickel Study Group (INSG) said. For the first three months of this year, there was a global surplus of 45,700 tonnes compared with a deficit of 16,200 tonnes in the same period of 2019, Lisbon-based INSG added. Tianrun Special Alloy, a high-grade nickel pig iron (NPI) producer in north China’s Inner Mongolia will suspend production at the end of June, when its existing nickel ore stocks are expected to be depleted. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 1610 while prices up 12.5 rupees, now Nickel is getting support at 965 and below same could see a test of 955.4 levels, and resistance is now likely to be seen at 981.3, a move above could see prices testing 988.

Trading Ideas:

* Nickel trading range for the day is 955.4-988.
* Nickel gained as ECB and German government announced big stimulus packages and U.S. data showed unemployment growth slowing sharply
* The global nickel market surplus narrowed to 14,000 tonnes in March from an upwardly revised 15,700 tonnes the previous month
* A high-grade NPI producer in Inner Mongolia to suspend production at end-June, taking 1,700 mt per month offline.

 

Aluminium

Aluminium yesterday settled up by 1.35% at 135.6 as more signs emerged that the Chinese economy is extending its recovery from the coronavirus outbreak. Social inventories of primary aluminium ingots in China fell slower, showed the latest data. Social inventories of primary aluminium ingots across eight consumption areas in China, including SHFE warrants, decreased 46,000 mt in the week ended June 4 to 847,000 mt, much smaller than a decline of 86,000 mt in the previous week. Inventories of aluminium billet in China declined at a slower pace this week as arrivals increased while shipments from warehouses shrank. A global aluminium producer has offered Japanese buyers a premium of $85 per tonne for July-September primary metal shipments, up 3.7% from the current quarter. Japan is Asia's biggest importer of the metal and the premiums for primary metal shipments it agrees to pay each quarter over the London Metal Exchange (LME) cash price set the benchmark for the region. For the April-June quarter, Japanese buyers agreed to pay a premium of $82 per tonne , down 1.2% from the prior quarter and booking the lowest since the October-December quarter in 2016. US services industry activity also pushed off an 11-year low in May, though businesses appeared in no rush to rehire workers as they reopen. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 838 while prices up 1.8 rupees, now Aluminium is getting support at 134.4 and below same could see a test of 133 levels, and resistance is now likely to be seen at 136.5, a move above could see prices testing 137.2.

Trading Ideas:

* Aluminium trading range for the day is 133-137.2.
* Aluminium prices gained as more signs emerged that the Chinese economy is extending its recovery from the coronavirus outbreak
* A global aluminium producer has offered Japanese buyers a premium of $85 per tonne for July-September primary metal shipments
* Social inventories of primary aluminium ingots in China fell slower, showed the latest data.

 

Mentha oil

Mentha oil yesterday settled down by -2.47% at 1075.5 as production this year is up nearly by 40% compare with last year, seen at a record high of 52,000-56,000 tn this year. There were expectations of higher area under cultivation for crop year 2020-21. After a week's delay due to heavy rainfall, oil from new mentha crop has started arriving at the key wholesale market of Barabanki in Uttar Pradesh, traders said. So far, arrivals of the spice oil are at 5-10 drums. New mint crop is being harvested in Bareilly, Sitapur and Konch districts. Demand is there for new mentha crop but it will take some time for bulk arrivals to hit markets. New arrivals are likely to pick up during the first week of June. In the first week of June, arrivals are likely to touch 100 drums per day. During the peak arrival season after mid-June, 400-500 drums will collectively arrive daily in the markets of Chandausi, Sambhal and Barabanki in Uttar Pradesh. Prices of the spice oil are also likely to remain on the downside as production is seen at a record high of 55,000-60,000 tn this year, up nearly 50%. The yield of mentha is expected to be high this time too, due to this, traders are not taking fresh positions in mentha. Technically market is under fresh selling as market has witnessed gain in open interest by % to settled at 53 while prices down -27.2 rupees, now Mentha oil is getting support at 1062.2 and below same could see a test of 1048.8 levels, and resistance is now likely to be seen at 1096.5, a move above could see prices testing 1117.4.

Trading Ideas:

* Mentha oil trading range for the day is 1048.8-1117.4.
* Mentha oil spot at Sambhal closed below 1200 level as demand concerns
* Mentha oil prices dropped as production this year is up nearly by 40%.
* There were expectations of higher area under cultivation for crop year 2020-21.
* The yield of mentha is expected to be high this time too, due to this, traders are not taking fresh positions in mentha.

 

Soyabean

Soyabean yesterday settled up by 1.19% at 3896 as support seen on news of countries beginning to ease lockdown measures has enabled prices to show some signs of recovery. Support also seen on news of US export sales to China, and US soyabean planting figures lagging behind industry estimates. India’s annual monsoon arrived on the Kerala, an official at the state-run weather office said, marking the start of the four-month rainy season that is crucial for the country’s farm-dependent economy. The U.S. Department of Agriculture said weekly soybean export sales were 1.669 million tonnes, topping forecasts that ranged from 800,000 tonnes to 1.6 million tonnes. Brazilian soybean exports between May 17 and May 31 will total an estimated 7.2 million tonnes, with the total for the month pegged at 14.7 million tonnes based on the shipping lineup. Normal monsoon outlook for this kharif season has brightened the prospects for soyabean cultivation starting next month. Meanwhile, the trade body has estimated exports for the year 2019-20 (October 2019 to September 2020) to fall by one lakh tonnes to 6 lakh tonnes. The USDA confirmed private sales of 396,000 tonnes of U.S. soybeans to China, a day after reporting sales of an additional 136,000 tonnes to the world's top soy importer. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 46045 while prices up 46 rupees, now Soyabean is getting support at 3850 and below same could see a test of 3803 levels, and resistance is now likely to be seen at 3932, a move above could see prices testing 3967.

Trading Ideas:

* Soyabean trading range for the day is 3803-3967.
* Soyabean prices gained as support seen on news of countries beginning to ease lockdown measures has enabled prices to show some signs of recovery.
* Support also seen on news of US export sales to China, and US soyabean planting figures lagging behind industry estimates.
* Prices also seen supported on fresh export demand for U.S. supplies and prospects for more sales in the coming weeks
* At the Indore spot market in top producer MP, soybean gained  4 Rupees to 3968 Rupees per 100 kgs.

 

Ref.Soyaoil

Ref.Soyaoil yesterday settled up by 0.63% at 800 as India's vegetable oil imports are likely to surge from June onwards as New Delhi eases coronavirus curbs, the head of a trading body said. India's vegetable oil imports in June could rise to 1.14 million tonnes, up from an average of 865,000 tonnes during April-May, as New Delhi eases coronavirus curbs, the Indian Vegetable Oils Producers' Association (IVPA) said. Prices also seen supported due to the pick up in spot demand following relaxations in the lockdown. The government has set up an inter-ministerial committee to consider sale of edible oil only in packaged form in retail markets, primarily to ensure quality, a government official said. "The committee, which was formed last week, is contemplating a ban on the sale of loose edible oil and favours its sale in only packaged form," the official said. U.S. soyoil stocks at the end of April were projected to jump to 2.532 billion lbs, from 2.328 billion lbs at the end of March. If realized, it would be the largest end-of-month soyoil supply in two years. Soyoil stocks estimates ranged from 2.350 billion to 2.750 billion lbs, with a median of 2.550 billion lbs. The National Oilseed Processors Association (NOPA), whose members account for 95% of all soybeans processed in the United States. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 22265 while prices up 5 rupees, now Ref.Soya oil is getting support at 794 and below same could see a test of 789 levels, and resistance is now likely to be seen at 803, a move above could see prices testing 807.

Trading Ideas:

* Ref.Soya oil trading range for the day is 789-807.
* Ref soyoil prices gained as India's vegetable oil imports are likely to surge from June onwards.
* Support also seen due to the pick up in spot demand following relaxations in the lockdown
* India's vegetable oil imports in June could rise to 1.14 million tonnes, up from an average of 865,000 tonnes during April-May.
* At the Indore spot market in Madhya Pradesh, soyoil was steady at 815 Rupees per 10 kgs.

 

Crude palm Oil

Crude palm Oil yesterday settled down by -0.37% at 651.3 on profit booking after prices gains on signs of improving demand as more countries ease coronavirus-induced lockdowns. Output in May is likely to fall 1% from the previous month, traders said, citing the Malaysian Palm Oil Association (MPOA) estimates. Malaysian palm oil inventories at the end of May likely jumped 9.9% from the previous month as production rose, hitting the highest level in six months despite a recovery in exports. May stockpiles are seen at 2.25 million tonnes, rising for a third successive month amid the coronavirus outbreak, according to the median estimate of 10 planters. Output in the world's second-largest producer behind Indonesia is expected to have risen 3.2% from April to 1.71 million tonnes, the highest in seven months. An easing of coronavirus containment measures, however, should also boost exports, which were pegged to hit a five-month high in May, rising 7% from April to 1.32 million tonnes as buyers replenish depleting stockpiles. India's palm oil imports in May plunged 53% from a year ago to 387,006 tonnes as a nationwide lockdown to curb the spread of the novel coronavirus squeezed demand from hotels and restaurants, a leading trade body said. Technically market is under fresh selling as market has witnessed gain in open interest by % to settled at 3127 while prices down -2.4 rupees, now CPO is getting support at 644.7 and below same could see a test of 638.1 levels, and resistance is now likely to be seen at 658.2, a move above could see prices testing 665.1.

Trading Ideas:

* CPO trading range for the day is 638.1-665.1.
* Crude palm oil dropped on profit booking after prices gains on signs of improving demand as more countries ease coronavirus-induced lockdowns.
* Malaysian palm oil inventories at the end of May likely jumped 9.9% from the previous month as production rose
* May stockpiles are seen at 2.25 million tonnes, rising for a third successive month amid the coronavirus outbreak.
* Malaysia, slashed the June palm oil export duty to zero, lowering its price against rival Indonesian palm.

 

Mustard Seed

Mustard Seed yesterday settled up by 1.56% at 4622 as farmers sold their stock at the government procurement centres, lowering supply in spot markets. In recent session prices gained because of lower-than-expected supply of fresh crop in spot markets following restrictions due to coronavirus scare in the country. Arrivals of the oilseed were at just over 980,000 tn, compared with 1.55 mln tn a year ago, according to data from the Mustard Oil Producers Association of India. The association has estimated India's mustard output in 2019-20 (Jul-Jun) at 7.6 mln tn, down from 8.1 mln tn in the previous crop year. This is lower than the farm ministry's third advance estimate of 8.7 mln tn. During Nov-Apr, mustard oil imports fell sharply to 17,000 tn, from 44,167 tn a year ago. Consultancy Strategie Grains has further reduced its forecast for this year's European Union rapeseed harvest, pegging the crop at 16.68 million tonnes compared with 17.02 million estimated a month ago. The downward revision, put the projected harvest below last year's poor crop of 16.92 million tonnes and would mark a new low since 2006. The European Commission reduced its monthly forecast for 2020/21 rapeseed production on an EU-27 basis not including Britain to 15.62 million tonnes, slightly above last year's equivalent EU-27 crop of 15.25 million Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 17400 while prices up 71 rupees, now Rmseed is getting support at 4575 and below same could see a test of 4528 levels, and resistance is now likely to be seen at 4649, a move above could see prices testing 4676.

Trading Ideas:

* Rmseed trading range for the day is 4528-4676.
* Mustard seed prices gained as farmers sold their stock at the government procurement centres, lowering supply in spot markets
* In recent session prices gained because of lower-than-expected supply of fresh crop in spot markets following restrictions due to coronavirus scare
* The European Commission reduced its monthly forecast for 2020/21 rapeseed production on an EU-27 basis not including Britain to 15.62 million tonnes
* In Alwar spot market in Rajasthan the prices dropped -12.5 Rupees to end at 4800 Rupees per 100 kg.

 

Turmeric

Turmeric yesterday settled up by 3.39% at 5488 as buyers reported active from lower levels as lower sowing area in Tamil Nadu due to deficient rainfall and in AP as shifted to Cotton and in some parts to Chilli due to current higher prices. At spot market, new Turmeric supply continued with higher moisture level around 4 - 5%. Turmeric production for 2020-21 is estimated at 452,698 MT (basis dry crop) compared to previous year’s 532,353 MT. AP Govt. declared Turmeric support prices. Earlier it was Rs.6,350/-per quintal but now it is Rs.6,850/-per quintal, for new crop from 1st February to 31st May. Andhra Pradesh Govt. started Turmeric procurement in Kadapa and Duggirala spot market from. last two days around 1,000 bags procured. In Nizamabad, Turmeric growing regions, 70 – 75% harvesting completed and 60% traded already before lockdown as new crop arrivals started coming from January last week. In Erode, 50 - 55% turmeric harvesting completed, harvesting process reported slow due to shortage of labour. Coimbatore – 60% completed, harvesting is going on. Salem – 65% completed, harvesting is going on. In Maharashtra – Sangli growing regions – 15- 20% completed, harvesting is going on, in Basmat growing regions – 50-55% completed, harvesting is going on, not traded yet, in Nanded- 55-60% completed, harvesting is going on, not traded yet. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 4900 while prices up 180 rupees, now Turmeric is getting support at 5364 and below same could see a test of 5242 levels, and resistance is now likely to be seen at 5564, a move above could see prices testing 5642.

Trading Ideas:

*  Turmeric trading range for the day is 5242-5642.
*Turmeric prices gained as buyers reported active from lower levels as lower sowing area in Tamil Nadu
* At spot market, new Turmeric supply continued with higher moisture level around 4 - 5%.
* Turmeric production for 2020-21 is estimated at 452,698 MT (basis dry crop) compared to previous year’s 532,353 MT.
* In Nizamabad, a major spot market in AP, the price ended at 5127.05 Rupees dropped -13.85 Rupees.

 

Jeera

Jeera yesterday settled up by 0.55% at 13665 as traders are still bracing for a continued slackness in offtakes as the Prime Minister talked about the fourth phase of the ongoing lockdown. Further prices seen some pressure on an elevated crop. Despite a peak demand period, the operations of spices industry in many upcountry markets have been hit in the wake of a labour shortage. Though the industry has to work in full swing prior to the onset of monsoon, their presence in the red zone area coupled with the departure of labour has affected the functioning of many spices industries especially in Maharashtra, Madhya Pradesh, Rajasthan, Delhi. In Rajasthan, all jeera mandis are closed in protest against announcement of two percent farmer welfare tax on the purchase and sale of agricultural products. Farmers are expecting nearly 30 per cent jump in jeera crop from 4,16,600 tonnes reported in 2019 to 5,35,500 tonnes this year, as projected by the Federation of Indian Spice Stakeholders (FISS) this year. According to the Unjha APMC officials, the yard has suspended auctions indefinitely due to the coronavirus scare. There will be no jeera auctions at the APMC till the pandemic outbreak is brought under control. It is difficult to maintain social distancing during auctions. Technically market is under fresh buying as market has witnessed gain in open interest by % to settled at 969 while prices up 75 rupees, now Jeera is getting support at 13580 and below same could see a test of 13500 levels, and resistance is now likely to be seen at 13710, a move above could see prices testing 13760.

Trading Ideas:

* Jeera trading range for the day is 13500-13760.
* Jeera prices gained on short covering after prices dropped as traders are still bracing for a continued slackness in offtakes.
* Despite a peak demand period, the operations of spices industry in many upcountry markets have been hit in the wake of a labour shortage.
* Farmers are expecting nearly 30 per cent jump in jeera crop from 4,16,600 tonnes reported in 2019 to 5,35,500 tonnes this year
* In Unjha, a key spot market in Gujarat, jeera edged down by -25.8 Rupees to end at 13745.65 Rupees per 100 kg.

 

Cotton

Cotton yesterday settled up by 3.02% at 16700 as support seen as CAI reduced its annual production estimate for this season, beginning from 1 October 2019, from 354 lakh bales to 330 lakh bales. Cotton production in India is likely to witness a severe decline with losses to the tune of thousands of crores in the current season, according to estimates released by the Cotton Association of India (CAI). The Southern India Mills Association (SIMA) welcomed the increase of MSP on cotton as it would benefit cotton farmers, while saying it was not a sustainable solution and called for bringing back the Technology Mission on Cotton. The minimum support price for seed cotton (kapas) for medium staple has been increased from Rs 5,255 to Rs 5,515 per quintal (by 4.75 per cent) and for long staple, it has been increased from Rs 5,502 to Rs 5,825 per quintal (4.95 per cent). With the current market price for cotton and expected accumulation of stocks due to COVID-19, the government would need to allocate huge funds for the forthcoming cotton season as the country would produce at least 25 per cent higher than the domestic requirement, apart from a carryover of 125 to 150 lakh bales of closing stock in the current season, he said. Technically market is under fresh buying as market has witnessed gain in open interest by 1.12% to settled at 3778 while prices up 490 rupees, now Cotton is getting support at 16350 and below same could see a test of 15990 levels, and resistance is now likely to be seen at 16910, a move above could see prices testing 17110.

Trading Ideas:

* Cotton trading range for the day is 15990-17110.
* Cotton gains as support seen as CAI reduced its annual production estimate for this season, from 354 lakh bales to 330 lakh bales
* The Southern India Mills Association (SIMA) welcomed the increase of MSP on cotton as it would benefit cotton farmers, while saying it was not a sustainable solution
* Anantapur MP met CCI officials in Guntur and prevailed upon them to open a cotton purchase centre at Gooty.
* Corona virus is affecting the global trade and world economies

 

Chana

Chana yesterday settled down by -0.17% at 4191 after update that due to heavy moisture. In recent session prices seen supported due to supply shortages as many cotton seed crushing units are closed. Andhra Pradesh aims to reduce the area under cotton in the coming 2020-21 (Jul-Jun) kharif season to 544,000 ha from 654,000 ha last year. Local textile mills and ginners were in distress. Many mills were closed up till now due to the building up of inventory while some mills were working partially but they were near closing. The government has decided to exempt cottonseed oil cake from 5 percent General Sales Tax. Punjab has registered a record production of cotton at 43.25 lakh quintals in 2019-20 season even as the procurement of the crop is still in its last stage. According to the data procured from the Punjab State Agricultural Marketing Board, the state has witnessed a jump of over 26% over the production of 34.68 lakh quintals recorded during the 2018-19 season. The Cotton Corporation of India (CCI) has announced bulk discount for cotton bales with it from 2018-2019 and 2019-2020 cotton seasons. The CCI’s operations under which the corporation procures cotton from farmers at the government declared Minimum Support Price (MSP) of Rs 5,550 per quintal continues till September. Technically market is under fresh selling as market has witnessed gain in open interest by % to settled at 45920 while prices down -7 rupees, now Chana is getting support at 4172 and below same could see a test of 4154 levels, and resistance is now likely to be seen at 4208, a move above could see prices testing 4226.

Trading Ideas

* Chana trading range for the day is 4154-4226.
* Chana dropped on profit booking after prices gained due to procurement activity by the government and news of amendment in essential commodities act.
* The acreage of the crop in the recently ended week is reported at 107.21 lakh hectares.
* According to NAFED, the government has procured nearly about 2.5 Lakh metric tonnes of Chana.
* In Delhi spot market, chana remains unchanged at by 0 Rupees to end at 4126.5 Rupees per 100 kgs.
 

 

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