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Gold

Gold yesterday settled up by 0.31% at 47962 amid a retreat in U.S. bond yields and a weaker dollar. Benchmark 10-year U.S. Treasury yields fell to a two-week low, decreasing the opportunity cost of holding non-yielding bullion. Federal Reserve officials face a ticking clock in their ability to ignore high inflation and are now navigating between their own senses of patience and risk, and a U.S. economy stymied by tangled supply chains, slow hiring and strong consumer demand. The combination of supply bottlenecks and a surge in household incomes fueled by pandemic-related government aid pushed the personal consumption expenditures price index, a key measure of inflation, to a 30-year high on a year-on-year basis in August. Investors are now awaiting Thursday's European Central Bank meeting and the U.S. Federal Open Market Committee policy meeting on Nov. 3 for more clues on the tapering timeline. The ECB is expected to keep policy unchanged and leave a decision on its pandemic emergency bond purchase programme to December. Elsewhere, the Fed chair Jerome Powell announced last week the Federal Reserve is ready to begin tapering its bond purchases, but maintained that it is premature to raise rates as employment remains low. Technically market is under short covering as market has witnessed drop in open interest by -1.58% to settled at 10459 while prices up 149 rupees, now Gold is getting support at 47715 and below same could see a test of 47468 levels, and resistance is now likely to be seen at 48114, a move above could see prices testing 48266.

Trading Ideas:

* Gold trading range for the day is 47468-48266.

* Gold prices steadied amid a retreat in U.S. bond yields and a weaker dollar.

* Benchmark 10-year U.S. Treasury yields fell to a two-week low

* Fed officials face a ticking clock in their ability to ignore high inflation and are now navigating between their own senses of patience and risk


Silver

Silver yesterday settled up by 0.27% at 65165 amid concerns over slowing economic growth, inflationary pressure and ongoing supply chain issues. Still, the yield remained close to a recent five-month high, as investors believe the Fed will start reducing stimulus as soon as next month. Fed Chair Powell reiterated the central bank would soon begin tapering although high inflation and pressure on wages will likely last into next year but will abate. Fresh GDP growth figures for Q3 due this week will be keenly watched for an update on the US economy. Extraordinary policy measures led by Group of 20 economies and COVID-19 vaccines are underpinning a global economic recovery, but new virus variants, inflation and supply-chain disruptions pose downside risks, the International Monetary Fund said. New orders for U.S.-made capital goods increased more than expected in September and shipments surged, pointing to strong business spending on equipment, though stretched supply chains likely hampered overall economic growth in the third quarter. Slower growth expectations were reinforced by other data from the Commerce Department showing the goods trade deficit widening sharply last month, with exports slumping. While wholesale inventories increased, stocks at retailers fell as supply at auto dealerships continued to decrease rapidly amid a global semiconductor shortage. Technically market is under short covering as market has witnessed drop in open interest by -4.05% to settled at 9957 while prices up 176 rupees, now Silver is getting support at 64616 and below same could see a test of 64067 levels, and resistance is now likely to be seen at 65626, a move above could see prices testing 66087.

Trading Ideas:

* Silver trading range for the day is 64067-66087.

* Silver prices remained supported amid concerns over slowing economic growth, inflationary pressure and ongoing supply chain issues.

* Investors believe the Fed will start reducing stimulus as soon as next month.

* New orders for U.S.-made capital goods increased more than expected in September and shipments surged

 

Crude oil

Crude oil yesterday settled down by -2.2% at 6220 after industry data showed crude oil stockpiles rose more than expected and fuel inventories increased unexpectedly last week in the United States, the world's largest oil consumer. U.S. crude stocks rose while gasoline and distillate inventories fell last week, the Energy Information Administration said. Crude inventories rose by 4.3 million barrels in the week to October 22 to 430.8 million barrels, compared with expectations for a 1.9 million-barrel rise. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 3.9 million barrels in the last week, EIA said. Refinery crude runs rose by 58,000 barrels per day in the last week, EIA said. Refinery utilization rates rose by 0.4 percentage points, in the week. Net U.S. crude imports rose last week by 702,000 barrels per day, EIA said. Crude oil tanks at the Cushing, Oklahoma storage hub are more depleted than they have been in the last three years, and prices of further dated oil contracts suggest they will stay lower for months. U.S. demand for crude among refiners making gasoline and diesel has surged as the economy has recovered from the worst of the pandemic. Demand across the globe means other countries have looked to the United States for crude barrels, also boosting draws out of Cushing. Technically market is under long liquidation as market has witnessed drop in open interest by -21.53% to settled at 5623 while prices down -140 rupees, now Crude oil is getting support at 6162 and below same could see a test of 6104 levels, and resistance is now likely to be seen at 6307, a move above could see prices testing 6394.

Trading Ideas:

* Crude oil trading range for the day is 6104-6394.

* Crude oil dropped after industry data showed crude oil stockpiles rose more than expected and fuel inventories increased unexpectedly.

* U.S. crude stocks rose while gasoline and distillate inventories fell last week, the Energy Information Administration said.

* Crude inventories rose by 4.3 million barrels in the week to October 22 to 430.8 million barrels

Nat.Gas

Nat.Gas yesterday settled up by 2.83% at 465.7 on forecasts for colder weather and higher heating demand over the next two weeks than previously expected. That price increase came despite a slow rise in U.S. output and as European gas prices declined after Russian gas giant Gazprom PAO's Nord Stream 2 cleared a major hurdle. Allowing Nord Stream 2 to pump Russian gas to Germany will not threaten supplies to the European Union, the German Economy Ministry said on Tuesday, moving the disputed pipeline closer to providing much needed supplies to Europe for the winter heating season. But U.S. export plants were already producing LNG near full capacity so no matter how high global prices rise, the United States can't export much more of the super-cooled fuel. In addition, the United States has more than enough gas in storage for the winter and ample production to meet domestic and export demand. Data provider Refinitiv said output in the U.S. Lower 48 states has averaged 92.3 billion cubic feet per day (bcfd) so far in October, up from 91.1 bcfd in September. Refinitiv projected average U.S. gas demand, including exports, would rise from 90.7 bcfd this week to 92.7 bcfd next week as more homes and businesses turn on their heaters. Technically market is under fresh buying as market has witnessed gain in open interest by 18.21% to settled at 6018 while prices up 12.8 rupees, now Natural gas is getting support at 449.2 and below same could see a test of 432.6 levels, and resistance is now likely to be seen at 476.2, a move above could see prices testing 486.6.

Trading Ideas:

* Natural gas trading range for the day is 432.6-486.6.

* Natural gas climbed on forecasts for colder weather and higher heating demand over the next two weeks than previously expected.

* That price increase came despite a slow rise in U.S. output and as European gas prices declined

* The United States has more than enough gas in storage for the winter and ample production to meet domestic and export demand.

 

Copper

Copper yesterday settled down by -2.01% at 747.25 after China’s state planner had asked major coal-producing provinces to investigate and regulate illegal storage sites and to crack down on hoarding. The market has been increasingly cared about the signs for an early interest rate hike ahead of the Fed’s interest rate meeting. Profits at China’s industrial firms rose at a faster pace in September even as surging raw material prices and supply bottlenecks squeezed margins and weighed on factory activity. Profits jumped 16.3% on-year to 738.74 billion yuan ($115.72 billion) the statistics bureau said, quickening from the 10.1% gain reported in August. The industrial sector has been hit by the surging price of coal, supply shortages and power rationing triggered by coal shortages due to emission reduction targets. The People’s Bank of China (PBOC) injected a total CNY 200 billion of seven-day reverse repos at an interest rate of 2.2 percent on October 27th, the same as in the previous day, and marking the third straight day of injections in the financial system. The central bank said, the move aims to countering factors including tax payments and government bond issuance in order to keep banking system liquidity reasonably ample. Technically market is under fresh selling as market has witnessed gain in open interest by 10.06% to settled at 4618 while prices down -15.3 rupees, now Copper is getting support at 739.4 and below same could see a test of 731.4 levels, and resistance is now likely to be seen at 759.2, a move above could see prices testing 771.

Trading Ideas:

* Copper trading range for the day is 731.4-771.

* Copper dropped as China had asked major coal-producing provinces to investigate and regulate illegal storage sites and to crack down on hoarding.

* China industrial profit growth accelerates in Sept despite cost pressures

* The market has been increasingly cared about the signs for an early interest rate hike ahead of the Fed’s interest rate meeting.


Zinc

Zinc yesterday settled down by -0.97% at 280.15 as declining thermal coal prices eased supply concerns. Coal prices slumped to their lowest in more than a month, hitting its daily 10% loss limit, after China’s state planner asked major coal-producing provinces to investigate and regulate illegal storage sites and to crack down on hoarding. On the fundamentals, the supply and demand of zinc are both weak, and the rising social inventories of zinc ingots have exacerbated market pessimism, pushing down zinc prices. However, the current zinc prices have fallen below the comprehensive costs of overseas smelters, so the overseas production activities should stay on the radar of market anticipants, as it may underpin zinc prices. The global zinc market deficit declined to 14,900 tonnes in August from a revised deficit of 40,400 tonnes in July, data from the International Lead and Zinc Study Group (ILZSG) showed. Previously, the ILZSG had reported a deficit of 6,600 tonnes in July. During the first eight months of 2021, the ILZSG data showed a deficit of 57,000 tonnes versus a surplus of 446,000 tonnes in the same period of 2020. Around 13.5 million tonnes of zinc are produced and consumed each year. Technically market is under fresh selling as market has witnessed gain in open interest by 1.87% to settled at 1035 while prices down -2.75 rupees, now Zinc is getting support at 275.4 and below same could see a test of 270.6 levels, and resistance is now likely to be seen at 284.2, a move above could see prices testing 288.2.

Trading Ideas:

* Zinc trading range for the day is 270.6-288.2.

* Zinc prices dropped as declining thermal coal prices eased supply concerns.

* The supply and demand of zinc are both weak, and the rising social inventories of zinc ingots have exacerbated market pessimism

* The global zinc market deficit declined to 14,900 tonnes in August from a revised deficit of 40,400 tonnes in July


Nickel

Nickel yesterday settled down by -2.89% at 1519.9 as the global nickel market deficit fell to 15,500 tonnes in August from a shortfall a month earlier of 25,700 tonnes, data from the International Nickel Study Group (INSG) showed. During the first eight months of the year, the nickel market saw a deficit of 172,200 tonnes compared with a surplus of 87,200 tonnes in the same period last year, the Lisbon-based INSG added. The premium of LME cash nickel over the three-month contract shot up to $189 a tonne, a level unseen since October 2019, indicating tightness of nearby supplies, following Eramet's report of a drop in ferronickel output in New Caledonia due to a wave of COVID-19 infections there. Nickel price has been hovering at the $20,000 level supported by lower supply and recovering demand as economies reopen as Covid-19 restrictions lifted. Nickel pig iron market in China continues to be very tight due to power rationing and some supply concerns from Indonesia and the Philippines. Guizhou province in China has asked some smelters to shut down temporarily due to power shortages. For nickel in China continues to be very tight due to power rationing and some supply concerns from Indonesia and the Philippines. Technically market is under fresh selling as market has witnessed gain in open interest by 2.43% to settled at 1434 while prices down -45.3 rupees, now Nickel is getting support at 1492.5 and below same could see a test of 1465.1 levels, and resistance is now likely to be seen at 1558.2, a move above could see prices testing 1596.5.

Trading Ideas:

* Nickel trading range for the day is 1465.1-1596.5.

* Nickel prices dropped as global nickel market deficit shrinks in August to 15,500 T

* The premium of LME cash nickel over the three-month contract shot up to $189 a tonne, indicating tightness of nearby supplies

* Nickel pig iron market in China continues to be very tight due to power rationing and some supply concerns from Indonesia and the Philippines


Aluminium

Aluminium yesterday settled down by -6.12% at 215.45 as the drop in coal prices eased traders' concerns over supply shortage of the metal. Aluminium smelting is an energy-intensive process and has been considered as one of the worst-hit sectors by China's power crisis, pushing up prices of the metal as coal hiked. But thermal coal hit its 10% lower trading limit on Wednesday after Chinese state planner said it had asked major coal-producing provinces to probe and regulate illegal storage sites, and to crack down on hoarding behaviour. Aluminium premiums in Europe declined over the week, with backwardations on further forward London Metal Exchange spreads spurring a sell-off of physical units. Traders were hesitant about taking on further stock with unappetizing backwardations making it expensive to hold metal, while end-consumer demand remained weak due to stoppages of automotive production. The December 2022/December 2023 spread was in a $160 per tonne backwardation, making stock retention throughout next year expensive and unappealing. The People’s Bank of China (PBOC) injected a total CNY 200 billion of seven-day reverse repos at an interest rate of 2.2 percent on October 27th, the same as in the previous day, and marking the third straight day of injections in the financial system. Technically market is under fresh selling as market has witnessed gain in open interest by 23.64% to settled at 3196 while prices down -14.05 rupees, now Aluminium is getting support at 210.5 and below same could see a test of 205.6 levels, and resistance is now likely to be seen at 224.6, a move above could see prices testing 233.8.

Trading Ideas:

* Aluminium trading range for the day is 205.6-233.8.

* Aluminium dropped tracking Shanghai aluminium hits 2 – month low as coal prices drop

* Aluminium premiums in Europe declined, with backwardations on further forward LME spreads spurring a sell-off of physical units.

* PBoC injected a total CNY 200 billion of seven-day reverse repos at an interest rate of 2.2 percent on October 27th

 

Mentha oil

Mentha oil yesterday settled down by -0.33% at 949 as demand from consumer side is extremely weak and industrial demand is also not picking up. Prices got support in last few weeks as due to crop failure and low recovery of oil, availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Major physical market player expects demand to sluggish for next few week as cash crunch seen in spot market, while expectations are high about demand improvement ahead of winter season starts. China is one of the biggest buyer for Indian Mentha, no much buying inquiry from China as mainland China and Hong Kong markets were shut. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Firstly damages due to rain in key area and secondly farmers for the last 2 years where sowing mentha but due to not getting much profit at intervals there had been shift to other crops also. In Sambhal spot market, Mentha oil dropped by -39.1 Rupees to end at 1054.9 Rupees per 360 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 0.58% to settled at 1048 while prices down -3.1 rupees, now Mentha oil is getting support at 945.2 and below same could see a test of 941.5 levels, and resistance is now likely to be seen at 953.8, a move above could see prices testing 958.7.

Trading Ideas:

* Mentha oil trading range for the day is 941.5-958.7.

* In Sambhal spot market, Mentha oil dropped  by -39.1 Rupees to end at 1054.9 Rupees per 360 kgs.

* Mentha oil prices dropped as demand from consumer side is extremely weak

* Prices got support in last few weeks as due to crop failure and low recovery of oil

* Availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season.
 

Soyabean

Soyabean yesterday settled up by 2.51% at 5358 tracking rise in overseas prices supported by signs of good overseas demand for U.S. supplies. European Union soybean imports in the 2021/22 season that started in July had reached 3.88 million tonnes by Oct. 24, data published by the European Commission showed. That compared with 4.58 million tonnes by the same week in the previous 2020/21 season, the data showed. Argentine farmers have so far sold 32.7 million tonnes of 2020/21 soy, the Agriculture Ministry said in a report including data through October 20. The rhythm of sales was behind that of the previous season, when as of the same date last year sales of 33.9 million tonnes of the oilseed had been registered, according to official data. Soyabean production is estimated to rise by 14 per cent to nearly 119 lakh tonnes this year on higher sowing area and likely improvement in productivity, according to industry body SOPA. In its estimate, Soyabean Processors Association of India (SOPA) said that the total area under soybean for the year 2021 is 119.984 lakh hectares. The government's area estimate is 123.677 lakh hectares. In last year's Kharif (summer sow) season, total soyabean acreage stood at 118.383 lakh hectare. At the Indore spot market in top producer MP, soybean gained 87 Rupees to 5412 Rupees per 100 kgs.Technically market is under short covering as market has witnessed drop in open interest by -2.19% to settled at 78275 while prices up 131 rupees, now Soyabean is getting support at 5236 and below same could see a test of 5113 levels, and resistance is now likely to be seen at 5456, a move above could see prices testing 5553.

Trading Ideas:

* Soyabean trading range for the day is 5113-5553.

* Soyabean gained tracking rise in overseas prices supported by signs of good overseas demand for U.S. supplies.

* European Union soybean imports in the 2021/22 season that started in July had reached 3.88 million tonnes by Oct. 24

* Argentine farmers have sold 32.7 mln tonnes of 2020/21 soy so far

* At the Indore spot market in top producer MP, soybean gained  87 Rupees to 5412 Rupees per 100 kgs.

 

Soyaoil

Ref.Soyaoil yesterday settled up by 1.17% at 1267.5 as the vegetable oil market faces a significant squeeze due to lower output. India slashed its base import tax on crude palm oil, crude soyoil and crude sunflower oil to zero from 2.5%, as the world's biggest vegetable oil buyer tries to cool near-record price rises. The Govt. has decided to impose stock limits on edible oils and oilseeds up to March 31, 2022. This decision has been taken to soften the prices of edible oils in the country and provide relief to consumers. The Ministry said that the stock limits will be decided by the respective state governments depending on local conditions. It has however decided to give exemption to importers and exporters subject to conditions. Oilseeds output is also expected to be down a tad at 23.38 mt as soyabean production was affected by the patchy rains in the key producing States of Gujarat and Madhya Pradesh, respectively. Favorable weather over the weekend boosted U.S. harvest, while exports remain capped by terminals on the U.S. Gulf Coast that continue to struggle with power outages and hurricane-led damage as the country heads into its busiest export season. India's vegetable oil imports are likely to contract for the second straight year, the Solvent Extractors' Association of India (SEA) said. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1303 Rupees per 10 kgs.Technically market is under short covering as market has witnessed drop in open interest by -3.63% to settled at 40245 while prices up 14.7 rupees, now Ref.Soya oil is getting support at 1254 and below same could see a test of 1242 levels, and resistance is now likely to be seen at 1275, a move above could see prices testing 1284.

Trading Ideas:

* Ref.Soya oil trading range for the day is 1242-1284.

* Ref soyoil prices seen supported as the vegetable oil market faces a significant squeeze due to lower output.

* Oilseeds output is also expected to be down a tad at 23.38 mt as soyabean production was affected.

* India’s Sept edible oil stocks at ports and pipelines rose 3.24 percent mom: SEA

* At the Indore spot market in Madhya Pradesh, soyoil was steady at 1303 Rupees per 10 kgs.


palm Oil

Crude palm Oil yesterday settled up by 0.73% at 1125.9 as supply constraints due to the rainy season and strength in rival oils supported the market. Prices are seen rising as the rainy season and coronavirus-linked labour shortage are slowing output in Malaysia. October export data improved amid tight supply worries. The Southern Peninsula Palm Oil Millers' Association (SPPOMA) estimated Oct. 1-15 production declined 0.2% from the month before in some parts of Malaysia. The Indian Vegetable Oils Producers Association says it is seeing early signs of demand shifting from palm oil to soft oils after India's duty cut made soft oil more attractive. Malaysia's crude palm oil production in 2021 is forecast to decline by 700,000 tonnes to 18.4 million tonnes due to a labour shortage and erratic weather conditions, state agency the Malaysian Palm Oil Council (MPOC) said. Neighbouring Indonesia has not faced such labour issues and has expanded its planted area by about 200,000 hectares this year, MPOC chief executive Wan Zawawi Wan Ismail said. Production in the world's largest palm oil producer is projected to rise by 2.5 million tonnes to 45.5 million tonnes, he said. Indonesian palm oil exports in 2021 will likely be much lower than previously forecast, at 34.423 million tonnes, the vice chairman of the Indonesia Palm Oil Association (GAPKI) told. In spot market, Crude palm oil dropped by -3.5 Rupees to end at 1148.3 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -9.55% to settled at 4924 while prices up 8.2 rupees, now CPO is getting support at 1116.6 and below same could see a test of 1107.4 levels, and resistance is now likely to be seen at 1134.9, a move above could see prices testing 1144.

Trading Ideas:

* CPO trading range for the day is 1107.4-1144.

* Crude palm oil prices seen supported as supply constraints due to the rainy season

* Prices are seen rising as the rainy season and coronavirus-linked labour shortage are slowing output in Malaysia.

* The Southern Peninsula Palm Oil Millers' Association estimated Oct. 1-15 production declined 0.2% from the month before in some parts of Malaysia.

* In spot market, Crude palm oil dropped  by -3.5 Rupees to end at 1148.3 Rupees.


Turmeric

Turmeric yesterday settled up by 3.5% at 7394 following export demand from Europe, Gulf countries and Bangladesh. However upside seen limited amid prospects of better crop this kharif season along with tepid demand. The areas where turmeric has been sown have received adequate rainfall and are expected to produce well in the next season. Due to favorable weather, production is likely to be higher in 2021-22 (July-June) season. Besides, heavy carryover stocks and slack in bulk demand are keeping prices under pressure. In the first 4 months of FY 2021-22, turmeric exports declined by 26% to 53,000 tonnes as compared to the same period last year, but almost at the same level as the 5-year average. Support is expected on the news that due to June and July floods almost 10% crop washed away so we can see 10-15 % less sowing also farmers had shown interested in other crops as prices where more. Pressure also seen as the lockdown restrictions were eased the key Turmeric growing states, including Maharashtra and Telangana reported noticeable increase in mandi arrivals, which augmented physical market supplies and pressurized prices. In the first 6 months of 2021, turmeric exports declined by 3% to 77,300 tonnes compared to the same period last year, but could be higher in the coming months. In Nizamabad, a major spot market in AP, the price ended at 7126.55 Rupees gained 12.65 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -17.14% to settled at 8265 while prices up 250 rupees, now Turmeric is getting support at 7220 and below same could see a test of 7044 levels, and resistance is now likely to be seen at 7496, a move above could see prices testing 7596.

Trading Ideas:

* Turmeric trading range for the day is 7044-7596.

* Turmeric gained following export demand from Europe, Gulf countries and Bangladesh.

* However upside seen limited amid prospects of better crop this kharif season along with tepid demand.

* The areas where turmeric has been sown have received adequate rainfall and are expected to produce well in the next season.

* In Nizamabad, a major spot market in AP, the price ended at 7126.55 Rupees gained 12.65 Rupees.

 

Jeera

Jeera yesterday settled up by 0.59% at 15280 as the export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin in a big way. However upside seen limited as adequate stock with traders and farmers may keeping prices under pressure at higher levels. With the forecast of normal rains in the western region during September to November, the sowing of cumin seeds in Gujarat and Rajasthan may increase. In 2021 (January-June), the country has exported more than 1.50 lakh tonnes of cumin as compared to 1.3 lakh tonnes in the same period last year. Purchase of cumin seeds from African and Middle East countries will be diverted from other countries to India this year. Recent estimates state that cumin production has slumped by 60% in Iran’s Razavi Khorasan Province due to severe drought and unusually cold weather coupled with an early spring. Rainfall ranges 63% lower than last year this season so far. Temperatures ranged 3.1-0.4C (37.58-32.72F) lower between October 2020 and April 2021 than in the same period in 2019/2020 according to official statistics. Extensive crop losses seen, the early onset of spring in February also caused serious damage to production. In Unjha, a key spot market in Gujarat, jeera edged up by 37.15 Rupees to end at 14780 Rupees per 100 kg.Technically market is under short covering as market has witnessed drop in open interest by -3.91% to settled at 5526 while prices up 90 rupees, now Jeera is getting support at 15175 and below same could see a test of 15070 levels, and resistance is now likely to be seen at 15365, a move above could see prices testing 15450.

Trading Ideas:

* Jeera trading range for the day is 15070-15450.

* Jeera gained as the export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin.

* However upside seen limited as adequate stock with traders and farmers may keeping prices under

* India's cumin exports will increase due to less supply from Afghanistan-Syrian

* In Unjha, a key spot market in Gujarat, jeera edged up by 37.15 Rupees to end at 14780 Rupees per 100 kg.

 

Cotton

Cotton yesterday settled up by 0.92% at 31680 amid low production, rising demand and supply constraints. Currently, raw cotton prices in various markets across the country are ruling above ₹7,000 a quintal against the MSP of ₹5,726 fixed for this year. Prices much above MSP means the CCI will not need to do any market intervention this year. Prices are moving up since the cotton balance sheet is tight and ending stocks are lower. Except China, no other country seems to have ample stocks. Cotton exports could be lower at 50 lakh bales this season (October 2021-September 2022) compared with 75-80 lakh bales last season. SIMA said the Committee on Cotton Production and Consumption (CCPC) had pegged the carryover stocks at 120 lakh bales and if additional 10-15 lakh bales of cotton would have been consumed or exported, ending stocks could be 105 lakh bales. SIMA said cotton production this year is estimated to be 360 lakh bales (170 kg) and if the carryover stocks are pegged at 100 lakh bales and imports at 10 lakh bales, the industry would have a total supply of 470 lakh bales. According to estimates of CAI, a trade body, the carryover stocks are estimated at 82.50 lakh bales. In spot market, Cotton gained by 60 Rupees to end at 30570 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 6.09% to settled at 3067 while prices up 290 rupees, now Cotton is getting support at 31180 and below same could see a test of 30690 levels, and resistance is now likely to be seen at 31980, a move above could see prices testing 32290.

Trading Ideas:

* Cotton trading range for the day is 30690-32290.

* Cotton prices remained supported amid low production, rising demand and supply constraints.

* Projections of tight supplies later this season leave industry worried

* Indian cotton exports will be reduced by 35 per cent from 78 lakh bales (last year) to around 45-50 lakh bales this year

* In spot market, Cotton gained  by 60 Rupees to end at 30570 Rupees.

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