MENU

Published on 20/01/2021 10:25:51 AM | Source: Kedia Advisory

Crude oil trading range for the day is 3806-3948 - Kedia Advisory

Posted in Commodities Reports| #Commodity Tips #Kedia Advisory

Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel  https://t.me/InvestmentGuruIndia 

Download Telegram App before Joining the Channel

Gold

Gold yesterday settled up by 0.18% at 48983 as the dollar eased off highs ahead of U.S. Treasury Secretary nominee Janet Yellen's speech later in the day, when she is expected to raise the case for more fiscal spending. Investors await Biden's inauguration on Wednesday mired in security concerns after the Jan. 6 assault on the U.S. Capitol by supporters of President Donald Trump. Euro zone finance ministers pledged continued fiscal support for their economies, while focus in the United States remains on Biden's $1.9 trillion stimulus package proposal. Fed Chair Jerome Powell also said there was no reason to alter the central bank's highly accommodative stance with the U.S. economy still far from its inflation and employment goals. Although U.S. inflation expectations have risen in anticipation of more U.S. fiscal stimulus, gold has not been the sole beneficiary – bond yields have risen and weighed on gold. Hedge funds and money managers reduced their bullish positions in COMEX gold contracts in the week to Jan. 12, the U.S. Commodity Futures Trading Commission (CFTC) said. Physical gold in China was sold at a small premium for the first time since early 2020, as demand picked up ahead of the Chinese new year. Dealers in China offered premiums of $0.50-$4 an ounce over benchmark spot gold prices. In India, dealers charged premiums of up to $0.50 an ounce, down from last week’s premium of $1.50. Technically market is under short covering as market has witnessed drop in open interest by -4.86% to settled at 6533 while prices up 89 rupees, now Gold is getting support at 48798 and below same could see a test of 48614 levels, and resistance is now likely to be seen at 49118, a move above could see prices testing 49254.           

Trading Ideas:            

* Gold trading range for the day is 48614-49254.

* Gold steadied as the dollar eased off highs ahead of U.S. Treasury Secretary nominee Janet Yellen's speech

* Investors await U.S. President-elect Joe Biden's oath ceremony

* Euro zone finance ministers pledge continued fiscal support

           

Silver     

           

Silver yesterday settled up by 0.93% at 66036 as the dollar weakened on optimism about China's economy and hopes for further global stimulus. Data that China's economy gathered momentum towards the end of 2020. After suffering a 6.8 percent contraction in the first three months of the year, China's economy notched three quarters of progressively stronger gains. China reported more than 100 new Covid-19 cases for the sixth consecutive day, while the number of hospitalized Covid-19 patients with serious symptoms in Japan topped 970, marking a record high since the onset of the pandemic in the country. Portugal imposed a new nationwide lockdown while the U.K. government announced that it will close all travel corridors from today in order to restrict the spread of new coronavirus variant cases. Biden urged immediate action on the $1.9 trillion economic stimulus plan, but some rescue projects in the proposal were opposed by many Republicans. The market has high expectations for the upcoming new round of stimulus bill, and economists expect that the new round of large-scale fiscal stimulus will boost the economic growth of the US this year. Biden will be sworn in as the 46th President of the US on January 20. The US retail sales unexpectedly fell in December, the producer price index rose lower than expected, and the manufacturing output increased for the eighth consecutive month. Consumer confidence fell more than expected in January. Technically market is under fresh buying as market has witnessed gain in open interest by 0.12% to settled at 11645 while prices up 607 rupees, now Silver is getting support at 65539 and below same could see a test of 65042 levels, and resistance is now likely to be seen at 66364, a move above could see prices testing 66692.     

Trading Ideas:            

* Silver trading range for the day is 65042-66692.

* Silver gained as the dollar weakened on optimism about China's economy and hopes for further global stimulus.

* Biden urged immediate action on the $1.9 trillion economic stimulus plan, but some rescue projects in the proposal were opposed by many Republicans.

* The US retail sales unexpectedly fell in December, the producer price index rose lower than expected

           

Crude oil    

           

Crude oil yesterday settled up by 1.41% at 3888 as optimism that government stimulus will buoy global economic growth and oil demand trumped concerns that renewed COVID-19 pandemic lockdowns globally could cool fuel consumption. Oil prices have also been supported by Saudi Arabia's additional supply cuts in the next two months which are expected to draw down global inventories by 1.1 million barrels per day in the first quarter. Concerns about rising COVID-19 cases globally and renewed lockdowns weighing down fuel demand kept a lid on oil prices. Investors are upbeat about demand in China, the world's top crude oil importer, after data showed its refinery output rose 3% to a new record in 2020. China was also the only major economy in the world to avoid a contraction last year as many nations struggled to contain the COVID-19 pandemic. The production of Libya's Waha Oil Company will be reduced by up to 200,000 barrels per day because of maintenance work on the main crude oil pipeline that links Al-Samah and Al-Dhahra oilfields to Es Sider port, Libya's National Oil Corp (NOC) said in a statement on its Facebook page. The maintenance operations will start as, Jan. 17, and expected to continue for two weeks, with NOC coordinating with Waha to reduce that period to between 7-10 days, the statement said. Technically market is under fresh buying as market has witnessed gain in open interest by 276.69% to settled at 1228 while prices up 54 rupees, now Crude oil is getting support at 3847 and below same could see a test of 3806 levels, and resistance is now likely to be seen at 3918, a move above could see prices testing 3948.

Trading Ideas:            

* Crude oil trading range for the day is 3806-3948.

* Crude oil edged up as optimism that government stimulus will buoy global economic growth

* Oil prices have also been supported by Saudi Arabia's additional supply cuts in the next two months

* Concerns about rising COVID-19 cases globally and renewed lockdowns weighing down fuel demand kept a lid on oil prices

           

Nat.Gas      

           

Nat.Gas yesterday settled down by -2.14% at 187.5 on forecasts for milder weather and lower heating demand through the end of January than previously expected. That decline came despite near record liquefied natural gas (LNG) exports as global gas prices remain near their highest in years. U.S. natural gas production and demand will drop in 2021 as the economic fallout from coronavirus lockdowns continues, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO). EIA projected dry gas production will drop to 88.17 billion cubic feet per day (bcfd) in 2021 from 90.76 bcfd in 2020 before rising to 89.66 bcfd in 2022. That compares with an all-time high of 93.06 bcfd in 2019. It also projected gas consumption would fall to 80.73 bcfd in 2021 and 79.03 bcfd in 2022 from 83.06 bcfd in 2020. That compares with a record high of 85.15 bcfd in 2019. If the outlook is correct, 2021 would be the first time output falls for two years in a row since 2005, and 2022 would be the first time consumption falls for three consecutive years since 1983. EIA's projections for 2021 in January were higher than its December forecasts of 87.91 bcfd for supply and 79.37 bcfd for demand. Technically market is under fresh selling as market has witnessed gain in open interest by 11.2% to settled at 6352 while prices down -4.1 rupees, now Natural gas is getting support at 183.6 and below same could see a test of 179.7 levels, and resistance is now likely to be seen at 193.9, a move above could see prices testing 200.3.      

Trading Ideas:            

* Natural gas trading range for the day is 179.7-200.3.

* Natural gas fell on forecasts for milder weather and lower heating demand through the end of January than previously expected.

* That decline came despite near record liquefied natural gas (LNG) exports as global gas prices remain near their highest in years.

* EIA projected dry gas production will drop to 88.17 billion cubic feet per day (bcfd) in 2021 from 90.76 bcfd in 2020 before rising to 89.66 bcfd in 2022.

           

Copper      

           

           

Copper yesterday settled up by 0.51% at 610.25 as stronger-than-expected economic data from top consumer China lent support, though rising COVID-19 infections globally weighed on prices and assuaged expectations of a swift economic recovery. China posted solid economic growth data in the last quarter of 2020, affirming that the world's second-biggest economy is well on track for a recovery from the pandemic slump. However, China reported more than 100 new virus cases for the seventh day in its worst domestic outbreak since last March, fuelling worries of further movement curbs that could dampen the economic recovery. China imported 512,000 mt of unwrought copper and copper semis in December, down 8.73% from the previous month and 3.33% from the same period 2019, according to the General Administration of Customs. The import volume of unwrought copper and copper semis in 2020 stood at 6.68 million mt, a significant increase of 34.13% from 2019. The most noticeable increase in imports in 2020 occurred in June-October as the import window which opened for an extended period drove large influx of imported copper. Domestic copper consumption recovered rapidly in Q2, while smelters conducted maintenance. Tight copper supply bolstered copper prices. Technically market is under short covering as market has witnessed drop in open interest by -7.27% to settled at 2652 while prices up 3.1 rupees, now Copper is getting support at 605.9 and below same could see a test of 601.4 levels, and resistance is now likely to be seen at 614.3, a move above could see prices testing 618.2.         

Trading Ideas:            

* Copper trading range for the day is 601.4-618.2.

* Copper advanced as stronger-than-expected economic data from top consumer China lent support.

* China posted solid economic growth data in the last quarter of 2020, economy is well on track for a recovery

* China imported 512,000 mt of unwrought copper and copper semis in December, down 8.73% from the previous month

           

Zinc    

           

Zinc yesterday settled up by 1.52% at 217.15 as investors wagered China's economic strength would help underpin growth in the region, even as pandemic lockdowns threatened to lengthen the road to recovery in the West. With the continuous fermentation of the global pandemic, the global economy is still highly uncertain. Countries strengthened the pandemic prevention and control measures to suppress the downward trend of zinc, but the expectation of the introduction of additional fiscal stimulus measures by the US is expected to limit its decline. Vedanta Zinc International said that mining has started again at its Gamsberg mine in South Africa following a closure in November when the pit wall collapsed, trapping miners underground. Zinc inventories in China fell over the weekend, primarily propelled by a decrease in Shanghai and Tianjin. Data showed that social inventories of refined zinc ingots across Shanghai, Tianjin, Guangdong, Jiangsu, Zhejiang, Shandong and Hebei decreased 1,100 mt from last Friday January 15 to 144,700 mt as of Monday January 18. The stocks were down 9,300 mt from last Monday January 11. Stocks in Shanghai decreased slightly as downstream restocked when zinc prices fell despite the increased arrivals at smelters and the inflow of imported zinc. In south China's Guangdong, low inventories lifted up the shipments at smelters, prompting stocks to rebound. Stocks in Tianjin fell as arrivals decreased with sluggish transaction prices and downstream rigid demand shrank. Technically market is under short covering as market has witnessed drop in open interest by -6.21% to settled at 1329 while prices up 3.25 rupees, now Zinc is getting support at 215.4 and below same could see a test of 213.5 levels, and resistance is now likely to be seen at 218.3, a move above could see prices testing 219.3. 

Trading Ideas:            

* Zinc trading range for the day is 213.5-219.3.

* Zinc gains as investors wagered China's economic strength would help underpin growth in the region

* Zinc inventories in China fell over the weekend, primarily propelled by a decrease in Shanghai and Tianjin.

* Vedanta reopens Gamsberg zinc mine in South Africa

           

Nickel     

           

Nickel yesterday settled up by 0.43% at 1323.5 as China's economic recovery accelerated in the fourth quarter, driven by stronger demand at home and abroad and policy stimulus, which is expected to provide a solid boost into 2021. U.S. retail sales fell for a third straight month in December, while U.S. producer prices rose moderately, suggesting that an anticipated pick-up in inflation in the coming months will probably not be worrisome. U.S. President-elect Joe Biden said he wants 100 million COVID-19 vaccine shots during his first 100 days in office, a day after unveiling a $1.9 trillion stimulus package proposal to jump-start the economy. China's refined nickel production in 2020 rose 1.4% to 164,600 tonnes, while output of stainless steel raw material nickel pig iron (NPI) plunged. Refined nickel output in December was up 3.1% from November at 14,090 tonnes but down 11.9% year on year as Shandong-based smelter Yantai Cash suspended a nickel production line. Top producer Jinchuan Group churned out 13,000 tonnes, up 4% from November, and met an annual target of 145,000 tonnes, Jinchuan is aiming 3.5% higher at 150,000 tonnes in 2021. NPI output fell 16.5% in 2020 to 504,000 tonnes on a nickel content basis as tight ore supply and slack downstream demand saw more plants opt to shut for maintenance. Technically market is under short covering as market has witnessed drop in open interest by -1.99% to settled at 1622 while prices up 5.7 rupees, now Nickel is getting support at 1306.9 and below same could see a test of 1290.2 levels, and resistance is now likely to be seen at 1337.6, a move above could see prices testing 1351.6.      

Trading Ideas:            

* Nickel trading range for the day is 1290.2-1351.6.

* Nickel prices remained supported as China's economic recovery accelerated in the fourth quarter.

* China's refined nickel production in 2020 rose 1.4% to 164,600 tonnes, while output of stainless steel raw material nickel pig iron (NPI) plunged.

* Refined nickel output in December was up 3.1% from November at 14,090 tonnes but down 11.9% year on year

           

Aluminium    

           

Aluminium yesterday settled up by 0.25% at 161.75 supported by a reminder of the new administration’s commitment to reflating an economy still badly depressed by the Covid-19 pandemic. Biden will take office as the next president of the US on Wednesday, and Yellen, the nominee of the US Treasury Secretary, will attend the Senate hearing, which is expected to defend the $1.9 trillion economic stimulus plan. However, at present, the COVID-19 continues to spread, and the increase of COVID-19 cases around the world makes investors take a cautious position. China's aluminium imports in December rose 40.5% from the previous month, customs data showed snapping three months of declines and extending 2020's position as a record year. The world's biggest aluminium producer, usually has little need for overseas supply but a rapid demand recovery after the coronavirus outbreak saw Shanghai prices surge above London, opening up an arbitrage for cheaper imports. The arb closed in the final quarter, but December arrivals of unwrought aluminium and aluminium products were still the highest since September at 265,569 tonnes, the General Administration of Customs data showed. That was up from 188,973 tonnes in November and up 147.3 year-on-year. Full-year shipments in 2020 were 2.7 million tonnes, up 318.7% on 2019. Technically market is under fresh buying as market has witnessed gain in open interest by 0.66% to settled at 914 while prices up 0.4 rupees, now Aluminium is getting support at 160.4 and below same could see a test of 159.1 levels, and resistance is now likely to be seen at 162.6, a move above could see prices testing 163.5.        

Trading Ideas:            

* Aluminium trading range for the day is 159.1-163.5.

*  Aluminium gained supported by a reminder of the new administration’s commitment to reflating an economy still badly depressed by the Covid-19 pandemic.

* Dec unwrought aluminium, products imports at 265,569 T

* Full-year 2020 imports set annual record high of 2.7 mln T

           

Mentha oil    

           

Mentha oil yesterday settled down by -0.58% at 972.1 as demand from cosmetics and toiletries sector will remain weak in India. The COVID-19 outbreak has had a huge impact on the worldwide economy, and has posed a similar influence on the aroma chemicals market. The market has been faced with the lack of migrant labor, supply chain disruptions, shutdown of manufacturing activities, to name a few. Support also seen on the expectation that India’s fragrance industry which had been slow, now slowly gaining the positive momentum post the COVID unlock down. Headed towards a new decade, the fragrance industry has received a much needed boost with the acceptance of trendy dhoop sticks and dhoop cones which has seen an increased 20% demand day by day. The global aroma chemicals market is likely to record a steady CAGR of about 4% during the assessment period of 2020-2030. Growing demand for aroma chemicals in the food & beverage and fragrance industry will underpin the growth of the market. Strict regulations in relation to artificial flavours are complimenting to the expansion of natural aroma chemicals in the food sector. Out of India's total mentha oil exports, nearly 55% goes to China while 16% goes to the US and around 5% goes to Singapore. In Sambhal spot market, Mentha oil dropped by -1.9 Rupees to end at 1091.3 Rupees per 360 kgs. Technically market is under long liquidation as market has witnessed drop in open interest by -3.88% to settled at 99 while prices down -5.7 rupees, now Mentha oil is getting support at 965.8 and below same could see a test of 959.5 levels, and resistance is now likely to be seen at 980.7, a move above could see prices testing 989.3.   

Trading Ideas:            

*  Mentha oil trading range for the day is 959.5-989.3.

* In Sambhal spot market, Mentha oil dropped  by -1.9 Rupees to end at 1091.3 Rupees per 360 kgs.

* Mentha oil dropped as demand from cosmetics and toiletries sector will remain weak in India

* The COVID-19 outbreak has had a huge impact on the worldwide economy, and has posed a similar influence on the aroma chemicals market.

* The global aroma chemicals market is likely to record a steady CAGR of about 4% during the assessment period of 2020-2030.

           

Soyabean     

           

Soyabean yesterday settled down by -1.87% at 4611 amid worry over slim demand from poultry after the bird flu outbreak. The poultry industry is the main consumer of soya and many private poultry players have a direct contract with farmers for supply of feed. BV Mehta, executive director of the Solvent Extractors’ Association of India (SEA), said that poultry consumes about 5 million tonnes of soya every year and despite the bird flu, soya prices would not come down drastically. “Soya constitutes about 30 per cent of poultry feed every month. If the domestic demand dips, we are looking for additional export. We don’t want to increase export by reducing supply to the domestic market, but if local demand fails to pick up we will enhance export,” said Mehta. China's soybean imports hit a record high in 2020, customs data showed, after crushers ramped up purchases amid improved margins and healthy demand from the country's rapidly recovering pig sector. China, the world's top soybean buyer, bought 100.33 million tonnes of the oilseed in 2020, up 13% from 88.51 million tonnes in 2019, according to the General Administration of Customs, the highest annual imports on record. December's imports came in at 7.524 million tonnes, down 27% from 9.54 million tonnes a year ago. At the Indore spot market in top producer MP, soybean gained 32 Rupees to 4709 Rupees per 100 kgs. Technically market is under long liquidation as market has witnessed drop in open interest by -3.79% to settled at 198605 while prices down -88 rupees, now Soyabean is getting support at 4562 and below same could see a test of 4514 levels, and resistance is now likely to be seen at 4676, a move above could see prices testing 4742.  

Trading Ideas:            

* Soyabean trading range for the day is 4514-4742.

* Soyabean prices dropped amid worry over slim demand from poultry after the bird flu outbreak.

* SEA said that poultry consumes about 5 million tonnes of soya every year.

* China's soybean imports hit a record high in 2020, customs data showed, after crushers ramped up purchases amid improved margins and healthy demand

* At the Indore spot market in top producer MP, soybean gained  32 Rupees to 4709 Rupees per 100 kgs.

           

Ref.Soyaoil     

           

Ref.Soyaoil yesterday settled down by -3.32% at 1081.8 as the sowing of oilseed crops has increased to 81.80 lakh hectares in the current Rabi whereas till this time last year, it was sown only in 77.79 lakh hectares. Pressure also seen tracking weakness in soyabean prices as the outbreak of bird flu may reduce the demand for soybean from the poultry industry. The outbreak of avian influenza in Parbhani district has been among poultry, while AI has been confirmed from crows in Mumbai, Thane, Dapoli, Maharashtra. Soybean production is estimated at 4.135 billion bushels, down 35 million led by reductions for Minnesota, Iowa, and Kansas. Largest exporter Argentina and Uruguay have also reported lower production of soybean this year, soybean production is lowered 2 million tons to 48 million for Argentina and 200,000 to 2.2 million for Uruguay, reflecting dry weather conditions in December and early January.. NOPA members, which handle about 95% of all soybeans processed in the United States, were estimated to have crushed a near-record 185.175 million bushels of soybeans last month. Soyoil supplies among NOPA members at the end of December were seen rising for a third straight month to 1.712 billion pounds, compared with 1.558 billion pounds at the end of November and 1.757 billion pounds at the end of December 2019. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1110 Rupees per 10 kgs. Technically market is under long liquidation as market has witnessed drop in open interest by -5.17% to settled at 36330 while prices down -37.2 rupees, now Ref.Soya oil is getting support at 1069 and below same could see a test of 1055 levels, and resistance is now likely to be seen at 1106, a move above could see prices testing 1129.    

Trading Ideas:            

* Ref.Soya oil trading range for the day is 1055-1129.

* Ref soyoil prices dropped as pressure seen amid the sowing of oilseed crops has increased to 81.80 lakh hectares.

* Pressure also seen tracking weakness in soyabean prices as the outbreak of bird flu may reduce the demand for soybean from the poultry industry

* Soybean production is estimated at 4.135 billion bushels, down 35 million led by reductions for Minnesota, Iowa, and Kansas.

* At the Indore spot market in Madhya Pradesh, soyoil was steady at 1110 Rupees per 10 kgs.

           

Crude palm Oil    

           

Crude palm Oil yesterday settled down by -2.86% at 924 on concerns over declining exports ahead of cargo surveyor data. Cargo surveyors are scheduled to release Jan. 1-20 export data on Wednesday, but sentiment is bearish after exports during the first two weeks of January plummeted 42% compared with a month earlier. European Union palm oil imports in the 2020/21 season that started last July had reached 3.24 million tonnes by Jan. 17, up from 3.10 million by the same time last year, data published by the European Commission showed. Exports of Malaysian palm oil products for January 1 – 15 fell 41.8 percent to 426,276 tonnes from 732,780 tonnes shipped during December 1 – 15. Malaysia kept its export duty for crude palm oil at 8% for February, a circular on the Malaysian Palm Oil Board website showed. China would import more Indonesian products, such as palm oil, and increase investment in Southeast Asia's largest economy, a top Chinese diplomat said, as Jakarta urged Beijing to remove barriers to make trade between the two countries more balanced. Malaysia's December palm oil end-stocks slumped 19% from the month before to 1.26 million tonnes, data from the Malaysian Palm Oil Board (MPOB) showed. Crude palm oil production fell 10.6% from November to 1.33 million tonnes. Palm oil exports surged 24.7% to 1.62 million tonnes, MPOB said. In spot market, Crude palm oil dropped by -7.4 Rupees to end at 945 Rupees. Technically market is under long liquidation as market has witnessed drop in open interest by -11.63% to settled at 3168 while prices down -27.2 rupees, now CPO is getting support at 913.8 and below same could see a test of 903.6 levels, and resistance is now likely to be seen at 942.1, a move above could see prices testing 960.2.           

Trading Ideas:            

* CPO trading range for the day is 903.6-960.2.

* Crude palm oil dropped on concerns over declining exports ahead of cargo surveyor data.

* Sentiment is bearish after exports during the first two weeks of January plummeted 42% compared with a month earlier

* European Union palm oil imports in the 2020/21 season that started last July had reached 3.24 million tonnes by Jan. 17,

* In spot market, Crude palm oil dropped  by -7.4 Rupees to end at 945 Rupees.

           

Mustard Seed      

           

Mustard Seed yesterday settled down by -0.26% at 5656 on short covering after prices dropped as sowing of mustard, has increased to 72.98 lakh hectare in the current Rabi whereas till last year, it was sown only in 68.15 lakh hectare. The sowing of oilseed crops has increased to 81.80 lakh hectares in the current Rabi whereas till this time last year, it was sown only in 77.79 lakh hectares. At the national level, the total production area of rabi crops increased to 620.71 lakh hectare on January 1, 2021, compared to 603.15 lakh hectare to 17.56 lakh hectare or 2.91 percent and the general average area from 620.27 lakh hectare to 44 thousand hectare in the same period last year. The latest data from the Union Ministry of Agriculture shows that this time the production of oilseeds crops was 75.93 lakh hectare as compared to the last season. In oilseed crops, mustard-rapeseed production area jumped from 66.62 lakh hectare last year to 72.39 lakh hectare. The Union Agriculture Ministry has set a target of sowing mustard in 75 lakh hectare area during the current Rabi season. In Alwar spot market in Rajasthan the prices gained 52.15 Rupees to end at 6317.9 Rupees per 100 kg. Technically market is under long liquidation as market has witnessed drop in open interest by -2.36% to settled at 15300 while prices down -15 rupees, now Rmseed is getting support at 5599 and below same could see a test of 5541 levels, and resistance is now likely to be seen at 5706, a move above could see prices testing 5755.

Trading Ideas:            

* Rmseed trading range for the day is 5541-5755.

* Mustard seed gained on short covering after prices dropped as sowing of mustard, has increased to 72.98 lakh hectare in the current Rabi

* The sowing of oilseed crops has increased to 81.80 lakh hectares in the current Rabi whereas till this time last year, it was sown only in 77.79 lakh hectares.

* At the national level, the total production area of rabi crops increased to 620.71 lakh hectare.

* In Alwar spot market in Rajasthan the prices gained 52.15 Rupees to end at 6317.9 Rupees per 100 kg.

           

Turmeric    

           

           

Turmeric yesterday settled up by 2.14% at 6206 amid expectation of decrease in Turmeric sown area in the kharif sowing season 2020 across Nizamabad and Marathwada regions. However upside seen limited due to excess stocks which will be 50-60% of the excess in the current year as carry forward in the next year. Covid-19 raised expectations regarding the consumption of turmeric as a body immune enhancer, but it did not last long. Poor quality of arrivals is another reason for the drop in demand. Therefore, many traders in Erode started buying turmeric from the markets of Andhra Pradesh and Maharashtra as the prices were low there. Despite 2% freight, they are saving 5% on costs. Apprehensions are there that water logging and higher moisture due to recent rains in October in major Turmeric growing regions of Telangana, Maharashtra, Karnataka is likely to have adverse impact on overall productivity of Turmeric. Stockiest are getting active and started purchasing actively due to factors like decreasing sowing area and increasing demand. On the export front, India exported around 0.86 lakh tonnes of Turmeric in April-August, 2020 which is 51% higher than April-August, 2019 at 0.57 lakh tonnes. In Nizamabad, a major spot market in AP, the price ended at 5845.25 Rupees gained 3.55 Rupees. Technically market is under short covering as market has witnessed drop in open interest by -2.85% to settled at 7830 while prices up 130 rupees, now Turmeric is getting support at 6102 and below same could see a test of 6000 levels, and resistance is now likely to be seen at 6268, a move above could see prices testing 6332.   

Trading Ideas:            

* Turmeric trading range for the day is 6000-6332.

* Turmeric gained amid expectation of decrease in Turmeric sown area across Nizamabad and Marathwada regions. 

* However upside seen limited due to excess stocks which will be 50-60% of the excess in the current year as carry forward in the next year.

* Stockiest are getting active and started purchasing actively due to factors like decreasing sowing area and increasing demand.

* In Nizamabad, a major spot market in AP, the price ended at 5845.25 Rupees gained 3.55 Rupees.

           

Jeera     

           

Jeera yesterday settled down by -0.87% at 13155 as the season progresses in Gujarat, the increase in Rabi sowing continues. The total sowing of cumin in Gujarat has been over 4,64,469 hectares, compared to 4,35,657 hectares in the same period last year and the three-year average of 4,06,141 hectares in the state. Prices are likely to decline due to a reduction in export demand amidst substantial carryover stocks. There has also been a decrease in demand from domestic stockists as the arrival of new crops is awaiting in the market. Meanwhile, prices are under pressure due to better sowing prospects this year. As the ongoing rabi sowing progress and overall demand in wholesale markets in steady with bulk buyers are looking at the prospect of a heay crop in current harvest, keeping the undertone in futures mostly weak over last one month or so. The latest data showed that acreage under Jeera in leading producing state of Gujarat was at 4.64 lakh hectates (lh), marking a jump of around 11% compared to the same time last year. Meanwhile some support can be seen as statement from the Spices Board said export of spices, which had fetched ₹12,273.81 crore in the first half of the current fiscal between April and September, had grown by 19 per cent compared to the corresponding period last year. In Unjha, a key spot market in Gujarat, jeera edged down by -40.6 Rupees to end at 13000 Rupees per 100 kg. Technically market is under fresh selling as market has witnessed gain in open interest by 3.97% to settled at 1413 while prices down -115 rupees, now Jeera is getting support at 13100 and below same could see a test of 13050 levels, and resistance is now likely to be seen at 13215, a move above could see prices testing 13280.        

Trading Ideas:            

* Jeera trading range for the day is 13050-13280.

* Jeera dropped as the season progresses in Gujarat, the increase in Rabi sowing continues.

* Prices declined due to a reduction in export demand amidst substantial carryover stocks.

* The total sowing of cumin in Gujarat has been over 4,64,469 hectares, compared to 4,35,657 hectares in the same period last year

* In Unjha, a key spot market in Gujarat, jeera edged down by -40.6 Rupees to end at 13000 Rupees per 100 kg.

           

Cotton      

           

Cotton yesterday settled up by 0.48% at 21120 on short covering after pressure seen after Cotton Association of India increasing India cotton stock estimates. Cotton Association of India increased Indian cotton output estimates for 2020-21 season to 358.50 lakh bales (170 kg) against 356 lakh bales pegged previously. Cotton farmers of Anantapur, who suffered due to vagaries of nature earlier, are now suffering due to lack of procurement centres in the district. The district has two cotton procurement centres in Gooty and Tadipatri, while Rythu Bharosa Kendras (RBKs) are limited to registering the names of the cotton growers. The Cotton Corporation of India (CCI), which opened two procurement centres, is paying Rs 5,825 per quintal for high quality cotton and Rs 5,725 per quintal for medium quality and Rs 5,615 for the low grade cotton to the farmers. But the farmers cannot go directly to the CCI procurement centres and sell their produce. They have to get their names registered with the RBKs and only after getting an alert on their mobile phones, they can go to the procurement centres. The farmers have to wait for their serial number and the produce will be procured depending on availability of space in the warehouse of the CCI procurement centres. In spot market, Cotton gained by 60 Rupees to end at 20940 Rupees. Technically market is under short covering as market has witnessed drop in open interest by -10.06% to settled at 2995 while prices up 100 rupees, now Cotton is getting support at 21060 and below same could see a test of 20990 levels, and resistance is now likely to be seen at 21220, a move above could see prices testing 21310.        

Trading Ideas:            

* Cotton trading range for the day is 20990-21310.

* Cotton gained on short covering after pressure seen as Cotton Association of India increasing India cotton stock estimates.

* CAI increased Indian cotton output estimates for 2020-21 season to 358.50 lakh bales.

* Cotton farmers of Anantapur, are suffering due to lack of procurement centres in the district.

* In spot market, Cotton gained  by 60 Rupees to end at 20940 Rupees.

           

Chana   

           

Chana yesterday settled up by 0.29% at 4460 on short covering after pressure seen after Pulses sowing area jumped by nearly 109% to 8.55 lh. Chana acreage has soared by 115% to 8.03 lh. Nafed’s unstable chana releasing strategy continues to affect market directly at a time when area is up by 5 % and the new crop is hardly one and a half month away. Nafed continued to fix reserve price and changed it frequently from Rs 5600 to Rs. 5100, again Rs. 5100 to Rs. 4875. Apart from it has offered 5 to 10 % discount over previous MSP on particular centers. As offtake from central pool is lower, Nafed may decrease price further to vacate storage space for new procurement. It would not allow chana cash market to go up beyond a certain level. Delhi chana is being traded at Rs4550-4650. Demand is weak. Weather condition in Jan –Feb remains crucial. The latest data shows that the total area of pulses has increased by 7% to 141 lakh hectares. More sowing is done in Maharashtra, Odisha and Jharkhand as compared to last year. Gram cultivation has increased by about 10%. NAFED to sell Gram PSS Rabi-2020 stock from all the States at or above base prices of Rs. 5100 per quintal in the month of December 2020, it offers an initial quantity of 1.5 LMT of Gram, for the month of December 2020. In Delhi spot market, chana dropped by -35.4 Rupees to end at 4450 Rupees per 100 kgs. Technically market is under short covering as market has witnessed drop in open interest by -0.82% to settled at 33920 while prices up 13 rupees, now Chana is getting support at 4434 and below same could see a test of 4408 levels, and resistance is now likely to be seen at 4478, a move above could see prices testing 4496.  

Trading Ideas:            

* Chana trading range for the day is 4408-4496.

* Chana gained on short covering after prices dropped as pressure seen after Pulses sowing area jumped by nearly 109% to 8.55 lh.

* Chana acreage has soared by 115% to 8.03 lh.

* Nafed’s unstable chana releasing strategy continues to affect market directly at a time when area is up by 5 %

* In Delhi spot market, chana dropped  by -35.4 Rupees to end at 4450 Rupees per 100 kgs.