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Published on 3/06/2020 9:52:41 AM | Source: Kedia Advisory

Rmseed trading range for the day is 4529-4693 - Kedia Advisory

Posted in Commodities Reports| #Commodity Tips #Kedia Advisory

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Gold

Gold yesterday settled down by -1.23% at 46558 as hopes for a gradual recovery in economic growth rose following easing of lockdowns, though deteriorating U.S.-China relations and fears over the spread of the coronavirus amid protests in the United States limited losses. The U.S. is likely to revoke Hong Kong's special status, and China would retaliate by limiting purchase of U.S. products- putting the Sino-U.S. trade deal in doubt, and providing support to gold; while the easing of lockdowns is capping gains. In a sign that the worst of the economic downturn from the coronavirus pandemic might be over, U.S. manufacturing activity crawled up slightly from an 11-year low, and China's factory activity unexpectedly returned to growth in May. Manufacturing activity in the U.S. contracted at a slightly slower rate in the month of May, according to a report released by the Institute for Supply Management. The ISM said its purchasing managers index rose to 43.1 in May from 41.5 in April, coming in just below estimates for a reading of 43.6. Reflecting investor sentiment, SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, said its holdings rose 0.5% to 1,128.40 tonnes on Monday, the highest in seven years. Technically market is under long liquidation as market has witnessed drop in open interest by -4.2% to settled at 14700 while prices down -580 rupees, now Gold is getting support at 46266 and below same could see a test of 45974 levels, and resistance is now likely to be seen at 47025, a move above could see prices testing 47492.

Trading Ideas:

* Gold trading range for the day is 45974-47492.
* Gold prices slipped as hopes for a gradual recovery in economic growth rose following easing of lockdowns.
* However deteriorating U.S.-China relations and fears over the spread of the coronavirus amid protests in the United States limited losses.
* U.S. manufacturing activity crawled up slightly from an 11-year low, and China's factory activity unexpectedly returned to growth in May.

 

Silver

Silver yesterday settled down by -3.03% at 49080 as some of the optimism about recovering industrial demand weakened in the face of widespread riots across the U.S. and reports that China was pressuring state buyers not to buy U.S. agricultural goods. Data showing an expansion in China's manufacturing activity in the month of May, and tensions between the U.S. and China over the latter imposing a security law on Hong Kong limited downside. Meanwhile, Beijing has warned Washington of retaliation after U.S. President Donald Trump announced that the United States would ban some Chinese graduate students and start reversing Hong Kong's special status in customs and other areas. US manufacturing activity eased off an 11-year low in May, the strongest sign yet that the worst of the economic downturn was behind as businesses reopen, though the recovery from the COVID-19 crisis could take years because of high unemployment. The Institute for Supply Management (ISM) said its index of national factory activity rose to a reading of 43.1 last month from 41.5 in April, which was the lowest level since April 2009. A reading below 50 indicates contraction in manufacturing, which accounts for 11% of the U.S. economy. It comes after China’s Caixin/Markit Purchasing Managers Index (PMI) showed a marginal but unexpected improvement in factory activity last month. Technically market is under long liquidation as market has witnessed drop in open interest by -9.51% to settled at 11757 while prices down -1531 rupees, now Silver is getting support at 48097 and below same could see a test of 47114 levels, and resistance is now likely to be seen at 50649, a move above could see prices testing 52218.

 

Trading Ideas:

* Silver trading range for the day is 47114-52218.
* Silver dropped as some of the optimism about recovering industrial demand weakened in the face of widespread riots across the U.S.
* An expansion in China's manufacturing activity, and tensions between the U.S. and China over the latter imposing a security law on Hong Kong limited downside.
* US manufacturing activity eased off an 11-year low in May, the strongest sign yet that the worst of the economic downturn

 

Crude oil

Crude oil yesterday settled up by 2.88% at 2746 with traders waiting to see whether major crude producers agree to extend their huge output cuts to shore up prices at a meeting expected later this week. Prices gained thanks to supply cuts by the Organization of the Petroleum Exporting Countries and allies, including Russia, dubbed OPEC+. However, prices are still down about 40% for the year so far. OPEC+ producers are considering extending their production cut of 9.7 million barrels per day (bpd), or about 10% of global output, into July or August, at an online meeting likely on June 4, which has helped prop up prices this week. Under the OPEC+ plan agreed in April, the record supply cut was to be for May and June, scaling back to a cut of 7.7 million bpd from July through December. Saudi Arabia has led talks pushing to extend the heftier cuts. Russian oil and gas condensate production fell to 39.7 million tonnes (9.39 million barrels per day) in May, near its target under a deal within the OPEC+ group, Interfax news agency reported. Under the agreement between Russia and the Organization of the Petroleum Exporting Countries, a group known as OPEC+, Moscow has pledged to reduce its output by around 2.5 million bpd to 8.5 million bpd to help support oil prices. Technically market is under fresh buying as market has witnessed gain in open interest by 25.25% to settled at 2932 while prices up 77 rupees, now Crude oil is getting support at 2697 and below same could see a test of 2647 levels, and resistance is now likely to be seen at 2778, a move above could see prices testing 2809.

 

Trading Ideas:

* Crude oil trading range for the day is 2647-2809.
* Crude oil gained with traders waiting to see whether major crude producers agree to extend their huge output cuts to shore up prices at a meeting expected later this week.
* Under the OPEC+ plan agreed in April, the record supply cut was to be for May and June, scaling back to a cut of 7.7 million bpd from July through December
* U.S. crude oil inventories likely increased last week, while distillate stocks rose for a ninth straight week.

 

Natural gas

Nat.Gas yesterday settled down by -2.18% at 134.7 as liquefied natural gas (LNG) exports continue to drop on record low gas prices in Europe and Asia. Data provider Refinitiv said gas output in the U.S. Lower 48 states was on track to fall to 87.6 billion cubic feet per day (bcfd) on the first day of June, down from a one-year low of 89.3 bcfd in May and an all-time monthly high of 95.4 bcfd in November. U.S. natural gas storage is expected to end the April-October injection season at a record 4.040 trillion cubic feet (tcf) around Oct. 31 as the coronavirus cuts demand before producers have a chance to reduce output. That compares with 3.762 tcf at the end of the injection season in 2019, the highest since 2017, and a five-year (2015-2019) average of 3.754 tcf. In 2017, there was 3.816 tcf of gas in storage on Oct. 31. The current all-time high on Oct. 31 is 4.013 tcf in 2016. U.S. natural gas prices at the Henry Hub benchmark in Louisiana in 2020 were expected to drop to their lowest since 1998 as near record production and ample storage reduce market worries about future price spikes and supply shortages. Technically market is under fresh selling as market has witnessed gain in open interest by 18.16% to settled at 10392 while prices down -3 rupees, now Natural gas is getting support at 133.4 and below same could see a test of 132 levels, and resistance is now likely to be seen at 136, a move above could see prices testing 137.2.

 

Trading Ideas:

* Natural gas trading range for the day is 132-137.2.
* Natural gas dropped as liquefied natural gas (LNG) exports continue to drop on record low gas prices in Europe and Asia.
* However upside seen limited as liquefied natural gas (LNG)  exports continue to drop on record low gas prices in Europe and Asia.
* U.S. natural gas storage is expected to end the April-October injection season at a record 4.040 tcf around Oct. 31

 

Copper

Copper yesterday settled up by 0.09% at 422.8 as a solid recovery in China demand and the reopening of economies from a coronavirus-induced lockdown lent support. A private business survey showed China's factory activity unexpectedly returned to growth in May, while a similar survey for larger Chinese companies showed rising activity in the services and construction sectors. Copper stocks in LME-registered warehouses have risen to 255,725 tonnes, double the level in the middle of January. Sliding tin stocks in LME warehouses, at a one-year low of 2,455 tonnes, and large holdings of warrants and cash contracts are behind the elevated premium for cash tin over the three-month contract. The premium touched a one-year high above $190 a tonne in May and was last at $97. China is importing at least two cargoes of copper concentrate from the United States after Beijing allowed Chinese companies to seek trade-war tariff waivers on the material. The United States was China's eighth-biggest copper concentrate supplier in 2017, sending almost 433,000 tonnes, but trade virtually dried up after Beijing imposed a 10% tariff on U.S. shipments from September 2018 and later raised it to 25%.Chinese firms have been allowed to apply for exemption on the duty since March 2 amid a trade war detente. Technically market is under short covering as market has witnessed drop in open interest by -0.62% to settled at 3052 while prices up 0.4 rupees, now Copper is getting support at 420.8 and below same could see a test of 418.8 levels, and resistance is now likely to be seen at 424.1, a move above could see prices testing 425.4.

 

Trading Ideas:

* Copper trading range for the day is 418.8-425.4.
* Copper prices settled flat as a solid recovery in China demand and the reopening of economies from a coronavirus-induced lockdown lent support.
* A private business survey showed China's factory activity unexpectedly returned to growth in May.
* Copper stocks in LME-registered warehouses have risen to 255,725 tonnes, double the level in the middle of January.

 

Zinc

Zinc yesterday settled down by -0.78% at 159.95 as tensions between the US and China remained in the spotlight. However downside seen limited as falling LME inventories and rising ratio of cancelled warrants boosted optimism around the progress of economic reopening ex-China. The pace of inventory decline should be closely watched to assess the progress of consumption recovery and its support to prices. It was reported that China has told state-owned firms to halt purchases of soybeans and pork from the US, raising concerns that the trade deal between the two powerhouses could be in jeopardy. The move comes after US President Donald Trump said on Friday he was directing his administration to begin the process of eliminating special treatment for Hong Kong, in response to China’s plans to impose new security legislation in the territory. Zinc inventories in China rose over the weekend, as limited demand failed to offset the arrival of imported materials in Shanghai and deliveries from Guangdong to Tianjin. Data showed that social inventories of refined zinc ingots across Shanghai, Tianjin, Guangdong, Jiangsu, Zhejiang, Shandong and Hebei increased 3,400 mt from last Friday May 29 to 219,000 mt as of Monday June 1. The stocks were down 3,100 from last Monday May 25. Technically market is under long liquidation as market has witnessed drop in open interest by -11.11% to settled at 1704 while prices down -1.25 rupees, now Zinc is getting support at 158.7 and below same could see a test of 157.3 levels, and resistance is now likely to be seen at 161.9, a move above could see prices testing 163.7.

 

Trading Ideas:

* Zinc trading range for the day is 157.3-163.7.
* Zinc prices dropped as tensions between the US and China remained in the spotlight.
* Falling LME inventories and rising ratio of cancelled warrants boosted optimism around the progress of economic reopening ex-China.
* The pace of inventory decline should be closely watched to assess the progress of consumption recovery and its support to prices.

 

Nickel

Nickel yesterday settled up by 1.19% at 963.4 as stronger manufacturing data from top consumer China and the loosening of lockdowns imposed to contain the coronavirus stoked expectations of healthier demand. The US dollar fell as risk sentiment improved on optimism that the worst of the economic downturn caused by the global spread of the coronavirus may be in the past. US manufacturing activity eased off an 11-year low in May, the strongest sign yet that the worst of the economic downturn was behind as businesses reopen, though the recovery from the COVID-19 crisis could take years because of high unemployment. The Institute for Supply Management (ISM) said on Monday its index of national factory activity rose to a reading of 43.1 last month from 41.5 in April, which was the lowest level since April 2009. It comes after China’s Caixin/Markit Purchasing Managers Index (PMI) showed a marginal but unexpected improvement in factory activity last month. The Caixin/Markit PMI for China’s manufacturing sector came in at 50.7 for May, up from the April reading of 49.4. PMI In the eurozone, the manufacturing PMI recovered somewhat in May from April’s record low, although factory activity still contracted heavily. Japan and South Korea, however, saw the sharpest falls in activity in more than a decade. Technically market is under fresh buying as market has witnessed gain in open interest by 30.8% to settled at 1529 while prices up 11.3 rupees, now Nickel is getting support at 952.7 and below same could see a test of 942 levels, and resistance is now likely to be seen at 969.4, a move above could see prices testing 975.4.

 

Trading Ideas:

* Nickel trading range for the day is 942-975.4.
* Nickel gained as stronger manufacturing data from top consumer China and the loosening of lockdowns.
* Risk sentiment improved on optimism that the worst of the economic downturn caused by the global spread of the coronavirus
* US manufacturing activity eased off an 11-year low in May, the strongest sign yet that the worst of the economic downturn was behind

 

Aluminium

Aluminium yesterday settled up by 0.45% at 132.7 on short covering after prices dropped amid as a slowdown in the depletion of social inventories of primary aluminium ingots in China. Social inventories of primary aluminium ingots in China continued to fall over the weekend, but the decline was moderate as deliveries leaving the warehouses reduced. Data showed that social inventories of primary aluminium ingots across eight consumption areas in China, including SHFE warrants, decreased 15,000 mt from last Thursday May 28 to 878,000 mt as of Monday June 1. US manufacturing activity eased off an 11-year low in May, the strongest sign yet that the worst of the economic downturn was behind as businesses reopen, though the recovery from the COVID-19 crisis could take years because of high unemployment. Aluminium producer Rusal is seeing customers returning with 20-30% of their usual demand after a slump in April caused by fallout from the new coronavirus outbreak. Rusal, the world's largest aluminium producer outside China, has had to deal with a drop in demand from major consumers of its metal – car and aviation industries – but the second quarter of 2020 is likely to be the worst of the crisis. Suspension of production by many aluminium-consuming industries has hit Rusal and other aluminium producers hard in March-May. Technically market is under short covering as market has witnessed drop in open interest by -3.69% to settled at 861 while prices up 0.6 rupees, now Aluminium is getting support at 132 and below same could see a test of 131.4 levels, and resistance is now likely to be seen at 133, a move above could see prices testing 133.4.

 

Trading Ideas:

* Aluminium trading range for the day is 131.4-133.4.
* Aluminium gained on short covering after prices dropped amid as a slowdown in the depletion of social inventories of primary aluminium ingots in China.
* Social inventories of primary aluminium ingots in China continued to fall over the weekend, but the decline was moderate
* Aluminium producer Rusal is seeing customers returning with 20-30% of their usual demand after a slump in April

 

Mentha oil

Mentha oil yesterday settled up by 0.92% at 1077 on short covering after prices dropped 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 buying as market has witnessed gain in open interest by 9.3% to settled at 47 while prices up 9.8 rupees, now Mentha oil is getting support at 1070.4 and below same could see a test of 1063.7 levels, and resistance is now likely to be seen at 1083.4, a move above could see prices testing 1089.7.

 

Trading Ideas:

* Mentha oil trading range for the day is 1063.7-1089.7.
* Mentha oil spot at Sambhal closed below 1200 level as demand concerns
* Mentha oil gained on short covering after 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 2.03% at 3924 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 short covering as market has witnessed drop in open interest by -11.02% to settled at 53730 while prices up 78 rupees, now Soyabean is getting support at 3876 and below same could see a test of 3828 levels, and resistance is now likely to be seen at 3954, a move above could see prices testing 3984.

 

Trading Ideas:

* Soyabean trading range for the day is 3828-3984.
* 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.
* In the May’20 WASDE report by USDA, the US 2020/21 soybean area is projected at 83.5 million acres compared to 76.1 million acres in 2019/20.
* At the Indore spot market in top producer MP, soybean gained  17 Rupees to 3949 Rupees per 100 kgs.

 

Ref.Soyaoil

Ref.Soyaoil yesterday settled up by 2.31% at 813.6 as support seen after update 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 short covering as market has witnessed drop in open interest by -9.34% to settled at 26255 while prices up 18.4 rupees, now Ref.Soya oil is getting support at 803 and below same could see a test of 792 levels, and resistance is now likely to be seen at 820, a move above could see prices testing 826.

 

Trading Ideas:

* Ref.Soya oil trading range for the day is 792-826.
* Ref soyoil prices gained as support seen after update India's vegetable oil imports are likely to surge from June onwards.
* Prices also seen supported 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 813.6 Rupees per 10 kgs.

 

Crude palm Oil

Crude palm Oil yesterday settled up by 2.72% at 664.1 supported by expectations of lower May output, but concerns over growing Sino-U.S. tensions capped the gains. Palm oil production in parts of Malaysia for the month of May fell 5.6% from the month before. The market is now awaiting the release of the Malaysian Palm Oil Association's May production data and is expecting a decline from previous estimates of an 11% monthly rise. Exports in the world's second largest palm producer rose between 7% and 8.4% in May from the month before. Indonesia will charge a blanket export levy of $55 per tonne on crude palm oil (CPO) shipments from June 1, a Finance Ministry regulation showed, as the government seeks to raise funds for a domestic biodiesel programme. Indonesia, the world's largest palm oil supplier, also set new tariffs for other refined palm oil products, ranging from $25 to $45 per tonne. Previously, export levies were only charged when the government reference price for CPO exports reached $570 per tonne, increasing to a maximum of $50 per tonne when the price exceeded $619. Indonesia wants to maintain its ambitious biodiesel programme to absorb excess palm oil supply and slash diesel fuel imports. Technically market is under fresh buying as market has witnessed gain in open interest by 5.62% to settled at 2405 while prices up 17.6 rupees, now CPO is getting support at 650.9 and below same could see a test of 637.8 levels, and resistance is now likely to be seen at 673.4, a move above could see prices testing 682.8.

 

Trading Ideas:

* CPO trading range for the day is 637.8-682.8.
* Crude palm oil gained supported by expectations of lower May output
* Palm oil production in parts of Malaysia for the month of May fell 5.6% from the month before.
* The market is now awaiting the release of the MPOA’s May production data and is expecting a decline from previous estimates of an 11% monthly rise.
* 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 1.27% at 4616 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 short covering as market has witnessed drop in open interest by -15.66% to settled at 9320 while prices up 58 rupees, now Rmseed is getting support at 4573 and below same could see a test of 4529 levels, and resistance is now likely to be seen at 4655, a move above could see prices testing 4693.

 

Trading Ideas:

* Rmseed trading range for the day is 4529-4693.
* 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 gained 103 Rupees to end at 4952 Rupees per 100 kg.

 

Turmeric

Turmeric yesterday settled up by 0.38% at 5276 on short covering after prices dropped amid reports of higher carry forwards stocks from last year due to higher production. State of Tamil Nadu and Andhra Pradesh has also ample amount of stocks which eased worries in the domestic market. Moreover, positive pre-monsoon reports by IMD has improved the sentiments for higher sowing in the June-August months of the current year in Telangana, Tamil Nadu and Maharashtra. This is expected to bring lower supplies in the coming months as farmers are expected to be engaged in the same. As per Department of Commerce, turmeric exports for the period April to January 2020 has been reported at 110,399.27 tonnes, lower by 25.83% compared to 138,920.39 tonnes of the last year. In Andhra Pradesh government has started procuring through Markfed and has purchased 5000 qt till now after lockdown at State advised price of INR 6850/qt, but even this procurement has not distorted the market due to lower demand. The demand is lower for both export as well as from bulk buyers as Covid-19 lockdown has led to demand destruction indirectly coming out from hotel and restaurant industry and at the same time the requirement has been deferred from spice manufacturers due to reduced finished product demand, lockdown and labour issues. Technically market is under short covering as market has witnessed drop in open interest by -8.71% to settled at 4090 while prices up 20 rupees, now Turmeric is getting support at 5240 and below same could see a test of 5206 levels, and resistance is now likely to be seen at 5298, a move above could see prices testing 5322.

 

Trading Ideas:

* Turmeric trading range for the day is 5206-5322.
* Turmeric gained on short covering after prices dropped amid reports of higher carry forwards stocks from last year due to higher production.
* State of Tamil Nadu and Andhra Pradesh has also ample amount of stocks which eased worries in the domestic market.
* Positive pre-monsoon reports by IMD has improved the sentiments for higher sowing in the June-August months of the current year
* In Nizamabad, a major spot market in AP, the price ended at 5131.25 Rupees gained 14.05 Rupees.

 

Jeera

Jeera yesterday settled up by 0.15% at 13785 on short covering after prices dropped as traders are still bracing for a continued slackness in offtakes. The harvest was delayed this year and just when the arrivals started picking up, government imposed the national lockdown. Chief Minister Ashok Gehlot directed that jeera produce should be charged 50 paise for every Rs 100 instead of the earlier stipulated fee of Rs 2. 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. Technically market is under fresh buying as market has witnessed gain in open interest by 3.49% to settled at 1158 while prices up 20 rupees, now Jeera is getting support at 13660 and below same could see a test of 13535 levels, and resistance is now likely to be seen at 13905, a move above could see prices testing 14025.

 

Trading Ideas:

* Jeera trading range for the day is 13535-14025.
* Jeera prices gained on short covering after prices dropped as traders are still bracing for a continued slackness in offtakes.
* Chief Minister Ashok Gehlot directed that jeera produce should be charged 50 paise for every Rs 100 instead of the earlier stipulated fee of Rs 2.
* 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 -20.55 Rupees to end at 13744.45 Rupees per 100 kg.

 

Cotton

Cotton yesterday settled up by 1.56% at 16230 as support seen after cotton body lowers crop estimates to 330 lakh bales from 354 lakh bales due to locust attack, less care during lockdown. It is observed that the recent Locust attack and Covid-19 on cotton plantings may not affect the cotton plants to impact the acreage or expected yields. Approximately 2 months demand supply mismatch is presently observed in entire supply chain for the crop season 2019-20 & 20-21. It is expected that the carry over stock will be in huge considerable quantities, thereby breaking previous records of at least 5 years. At present the Indian Cotton is the cheapest in the world due to which there is a good demand from importing countries thereby hitting the expected figures to 50 Lakh Bales and correspondingly reducing the estimated imports by 5-10 lakh bales. Since the rains are expected to be normal this year and also the considerable quantity of seed cotton is with Farmers, it is expected that the stock of seed cotton will also be carried to the new crop season. Even though the consumption has reduced in last two months but looking at the present demands in domestic as well as international markets, the price of cotton bales is expected to rise in coming weeks. Technically market is under short covering as market has witnessed drop in open interest by -1.19% to settled at 3804 while prices up 250 rupees, now Cotton is getting support at 16140 and below same could see a test of 16050 levels, and resistance is now likely to be seen at 16330, a move above could see prices testing 16430.

 

Trading Ideas:

* Cotton trading range for the day is 16050-16430.
* Cotton prices gained as support seen after cotton body lowers crop estimates to 330 lakh bales from 354 lakh bales due to locust attack.
* The recent Locust attack and Covid-19 on cotton plantings may not affect the cotton plants to impact the acreage or expected yields.
* Telangana aims to increase the area under cotton in the coming 2020-21 (Jul-Jun) kharif season to 2.4 mln ha from 2.1 mln ha last year.
* Corona virus is affecting the global trade and world economies

 

Chana

Chana yesterday settled up by 0.1% at 4192 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 short covering as market has witnessed drop in open interest by -8.76% to settled at 21350 while prices up 4 rupees, now Chana is getting support at 4170 and below same could see a test of 4147 levels, and resistance is now likely to be seen at 4218, a move above could see prices testing 4243.

 

Trading Ideas:

* Chana trading range for the day is 4147-4243.
* Chana prices gained as support continues 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 4105 Rupees per 100 kgs.
 

 

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