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SPICES

• NCDEX Spices complex got-off on a positive note on the first trading day on 2022. On Monday, Jeera January futures hit two year high, while both Turmeric and Coriander futures hit six year high respectively. Expectation of lower acreage in jeera and coriander in the ongoing rabi season lend support, while robust demand and concerns over production lifted the yellow spice.

• Exports of spices from India during Apr-Sep declined 8% on year to 780,273 tn, according to data from the Spices Board India.

• Spices Board pegs Apr-Sep jeera exports at 139,295 ton, down 14%.

• Spices Board pegs Apr-Sep turmeric exports at 77,245 ton, down 26%.

• Spices Board pegs Apr-Sep pepper exports at 10,844 ton, up 24%.

• Spices Board pegs Apr-Sep small cardamom exports 4,240 ton, up 101%.

• Spices Board pegs Apr-Sep coriander exports at 24,459 ton, down 13%

• According to third advanced estimates by the farm department, spices output is seen rising to 10700000 tonnes in 2020-21, up by 5.5 per cent compared to 10140000 produced in 2019-20.

• According to the Gujarat State farm dept., jeera has been sown across 274298 ha as of December 13, compared to 453704 ha during the same period last year.

• Jeera production is seen at 856,505 ton in FY 2020-21, down 6.1% on year according to the Spices Board.

• India exported 299,000 tn of jeera in 2020-21, up 40% on year according to the Spices Board.

• The Spices Board has pegged coriander production at 822,210 tn, up 17.3% on year.

• According to Spices Board, Coriander exports from India were up 21% on year at 57,000 ton.

• Government sees 2020-21 coriander output at 720000 tons compared to 701000 tons a year ago.

• Spices Board sees exports of turmeric up 33% to 183000 tonnes in FY 2020-21 on yoy basis.

• Government sees 2020-21 turmeric output at 1.11 million tonnes compared to 1.15 million tons a year ago.

• Spices Board pegs FY21 small cardamom export 6,500 ton, up 251% on year.

• Output of small cardamom is seen rising by 100% on year to 22520 tons according to the Spices Board.

TECHNICAL VIEW

COTTON

• The UK-based Cotton Outlook has scaled down its estimate for global production in 2021-22 (Aug-Jul) by 43,000 tn to 26.0 mln tn, in its December report. The estimate has been revised downward as production in India is expected to be lower. The agency has marginally raised its output estimate for China, Pakistan, and the US. Cotton production in Indiais seen at 5.99 mln tn against 6.17 mln tn estimated in the previous month. The production in China is seen at 5.76 mln tn, while the US is likely to produce 3.98 mln tn. The agency has also lowered its estimate for global consumption in 2021-22 by 180,000 tn to 25.97 mln tn owing to a sharp fall in demand from China. Global cotton ending stocks are estimated at 27,000 tn for the ongoing 2021-22 season.

• The Cotton Association of India has maintained its production estimate for the 2021-22 (Oct-Sep) marketing season at 36.0 mln bales (1 bale = 170 kg. The association has estimated cotton production in north India, which includes Punjab, Haryana and Rajasthan, at 5.3 mln bales. In the central zone, which includes Gujarat, Maharashtra and Madhya Pradesh, the output is estimated at 20.4 mln bales. In the southern region, production is pegged at 9.6 mln bales. Of the total crop, around 7.8 mln bales had arrived in markets across India till November. Exports in the ongoing marketing year are pegged at 4.8 mln bales. India shipped around 700,000 bales of cotton till November. The association has also maintained its estimate for domestic cotton consumption at 33.5 mln bales, while imports are seen at around 1.0 mln bales. Ending stock for the season has been estimated at 6.2 mln bales.

• The US Department of Agriculture has scaled down its estimate for 2021-22 (Aug-Jul) global cotton production to 121.6 mln bales (1 US bale = 218 kg), from 121.8 mln bales projected a month ago. The downward revision was mainly due to a likely smaller crop in Pakistan, the agency said in its World Agricultural Supply and Demand Estimates report for December. Global cotton consumption is now seen slightly higher at 124.3 mln bales in 2021-22, as against 124.1 mln bales projected earlir. Exports are estimated at 47.0 mln bales, higher than the earlier projection of 46.6 mln. Exports are projected higher for Brazil and the Franc Zone. The agency has revised downward its 2021- 22 global ending stocks estimate to 85.7 mln bales from 86.9 mln bales. Cotton production in Indiais maintained at 28.0 mln bales. Domestic consumption is seen at 25.8 mln bales, while exports are estimated at 5.8 mln bales. Ending stocks for the country are seen at 10.8 mln bales for 2021-22 season, compared with 11.3 mln bales seen a month ago. In the US, production is seen slightly higher at 18.3 mln bales due to rise in yields. Exports are maintained at 15.5 mln bales. US is the top exporter of cotton.

• India's cotton exports in the ongoing 2021-22 (Oct-Sep) marketing year have slowed due to higher prices in the domestic market, making overseas sales economically unviable, trade officials said. • The International Cotton Advisory Committee has lowered its forecast for global prices for 2021-22 (Aug-Jul) due to a rise in global production and ending stocks estimate, the agency said in a report. The committee revised downward its price forecast for Cotlook A Index, a global benchmark for prices of raw cotton, by 1 cent from the previous month to 103 cents per pound. In 2021-22 season, the committee estimated global ending stocks for the season at 20.5 mln tn, slightly higher than 20.4 mln tn in the previous season. Global consumption is seen almost steady at 25.6 mln tn. The agency sees global export for the season at 10.2 mln tn, as against 10.6 mln tn a year ago. Global production for the ongoing season is estimated at 25.7 mln tn, compared with 24.3 mln tn in the previous season. The rise has largely been attributed to higher production in the US and Brazil. In the US, cotton production is estimated at 3.96 mln tn, against 3.18 mln tn a year ago. Output in India, the largest producer, is expected to be 5.9 mln tn, compared with 6.0 mln tn in the previous year.

• India's cotton exports have slowed down in the current marketing year that began on Oct 1 as higher domestic consumption led to a tight supply situation and a rise in local prices, said market experts. In the ongoing marketing year of 2021-22 (Oct-Sep), around 200,000 bales of cotton were exported till October. Most of the consignments were shipped to Bangladesh followed by China and Vietnam, a trade official said. "Forward export deals of 600,000- 700,000 bales of cotton for Nov-Dec delivery are still in transit, these deals were struck at a price of 115-125 cents per pound on a cost-and-freight basis," said Dharmendra Jain, director of Ahmedabad-based D.P. Cotton. Exports may touch around 900,000 bales by December, which is sharply lower than the previous year. In 2020-21, India shipped around 1.2-1.5 mln bales during Oct-Dec, industry experts said.

• The new season for cotton which started on Oct 1, is expected to be good for farmers as the market price of the fibre is currently more than the minimum support price, due to firm demand and a rise in global prices.

• Sowing of cotton across the country has ended and farmers have sown the crop across 12 mln ha in the 2021-22 (JulJun) kharif season, down 6% from a year ago, data from the farm ministry.

• India's cotton output in the 2021-22 (Oct-Sep) marketing year is seen at 36.2 mln bales (1 bale = 170 kg), as per the median of estimates of 13 prominent players in the cotton value chain polled by Informist.

• In the ongoing 2021-22 (Jul-Jun) season, cotton acreage across the country was 11.9 mln ha as on Thursday, down 5.8% from a year ago, data from the farm ministry showed.

• In the Union Budget for 2021-22 (Apr-Mar), Finance Minister Nirmala Sitharaman proposed customs duty of 5% on cotton and 10% on cotton waste. She also proposed an Agriculture Infrastructure and Development Cess of 5% on cotton, taking the overall customs duty to 10%. Customs duty on raw silk and silk yarn or yarn spun from silk waste has been increased to 15% from 10% earlier.

OTHERS

• As of Wednesday, the area under rabi chana across the country this year was at 10.25 mln ha, largely unchanged from a year ago, data from the farm ministry showed. States such as Andhra Pradesh, Bihar, Gujarat, Maharashtra, Punjab, Telangana, and Uttar Pradesh have seen a rise in acreage. On the other hand, acreage fell in Karnataka, Chhattisgarh, Madhya Pradesh and Jharkhand. Farmers in Madhya Pradesh, the largest grower, had sown chana across nearly 2.4 mln ha, down 2.7% on year, so far this rabi season. The government had fixed the minimum support price of chana for the 2022-23 (Apr-Mar) marketing season at 5,230 rupees per 100 kg, as against 5,100 rupees the previous year.

• The Securities and Exchange Board of India has asked the National Commodity and Derivatives Exchange to not launch any new chana contracts on its platform till further notice, the market regulator said in a release on August 16. NCDEX has also been directed to not take any new positions for the running contracts, and only squaring up of positions will be allowed on the platform with immediate effect, according to the official release.

• Government raises MSP for Rabi crops for season 2022-23. MSP for chana has increased by 2.5 % to Rs. 5230/qtl. against Rs. 5100/qtl previous year.

• Guarseed and guargum futures posted gains for the year 2021, climbing to multi-year highs. Expectation of rise in demand, jump in crude oil prices and expectation of lower production lifted guar complex.

• India’s guar gum exports increased in the month of October 2021 by 21.74% to 23,292 tonnes compared to 19,132 tonnes during previous month at an average FoB of US $ 1849 per tonne in the month of Oct’2021 as compared to US $ 1756 per tonne previous month. Further, the gum shipments were up by 62.53% in Oct’2021 compared to the same period last year. Of the total exported quantity, around 10,083 tonnes bought by US, Russia 3,327 tonnes, Germany 2,711 tonnes, china 789 tonnes, Australia 466 tonnes and Canada 911 tonnes.

• India’s guar split exports decreased in the month of Oct’2021 by 29.51% to 2,580 tonnes compared to 3,660 tonnes previous month at an average FoB of US $ 1325 per tonne in the month of Oct’21 compared to US $ 1,370 per tonne previous month. However, the guar split shipments gone down by 24.78 % in Oct 2021 compared to the same period last year. Of the total exported quantity, around 1,900 tonnes bought by China, US 500 tonnes and Netherland 120 tonnes.

• According to Rajasthan govt 2021-22 first advance estimates, Guar seed production estimate pegged at 13.73 lakh tonnes vs 11.36 lakh tonne last year, Additionally, 2021-22 acreage stood at 21.13 lakh hectare as compared to 24.84 lakh hectare last year. Yield pegged higher at 650 kg/Ha vs 458 kg/Ha last year.

• According to Gujarat govt 2021-22 first advance estimates, Guar Seed production estimate pegged at 1.01 lakh tonne Vs 0.85 Lakh tonnes last year, Additionally, 2021-22 acreage stood at 1.21 lakh ha Vs 1.22 lakh ha. Yield pegged higher at 873 kg/ha Vs 699 Kg/ Ha last year.

• Rubber futures on MCX ended slightly up on Monday and RSS4 grade rubber was quoted around Rs.166 a kg in the spot market, up from Rs.165 a kg quoted in previous trading session.

TECHNICAL VIEW

OILSEED

• Production of canola in Canada for 2021-22 (Aug-Jul) is seen at a 13-year low of 12.6 mln tn, Agriculture and Agri Food Canada said in its December report. Supply of canola for the country is estimated at 14.5 mln tn, the lowest since 2008-09, on tight carry-in stocks, reduced output and modest imports. Export of canola is likely to fall 49% on year to 5.4 mln tn. Volatility for canola prices is expected to remain high with the market vulnerable to sharp corrections from either demand or supply shocks.

• As of Friday, the area under mustard in the ongoing 2021-22 (Jul-Jun) rabi season was at 8.85 mln ha, up 22.5% on year, according to data by the farm ministry. The government fixed the minimum support price of the crop at 5,050 rupees per 100 kg for the 2022-23 (Apr-Mar) marketing season, as against 4,650 rupees in the previous year.

• The Centre has included soymeal under the Essential Commodities Act with immediate effect till Jun 30 to regulate production, stocking, and distribution of the commodity.

• The government has reduced the basic import duty on refined, bleached, and deodorised palm oil, to cool domestic prices, the finance ministry said in a notification. The new duty rates will be in place till Mar 31, the ministry said. The effective basic import duty on refined, bleached, and deodorised palm oil has been reduced to 12.5% from 17.5% earlier. With the new duty cut, the duty difference between crude palm oil, which is a raw material, and refined, bleached, and deodorised palm oil, which is the finished product, has reduced to 5.5% from 11.0% earlier.

• The Securities and Exchange Board of India asked exchanges not to launch new contracts of some farm commodities, including those of soybean and its derivatives, and crude palm oil. The restrictions come into effect immediately and shall be applicable for one year

• India's oilmeal exports fell 51.1% on year to 162,442 tn in November, according to data released by The Solvent Extractors' Association of India. In Apr-Nov, overall exports of oilmeal were at 1.59 mln tn, down 18.2% on year. Soymeal exports fell drastically to 42,951 tn in November compared with 198,776 tn in the same period last year because the Indian variant is priced higher in international markets. In November, mustard meal exports fell about 6.0% on year to 42,383 tn, while exports of castor meal were down nearly 22.5% on year at 28,876 tn.

• The Central Organisation for Oil Industry and Trade has estimated India's mustard output in the 2021-22 (Jul-Jun) rabi season at 10-11 mln tn because of increase in acreage, it said in a release. In 2020-21 the country produced around 8.5 mln tn of mustard, which is a crucial oilseed sown in the rabi season during Sep-Oct and harvested from February.

• India's vegetable oil imports increased 6.4% on year to around 1.17 mln tn in November, according to SEA. For the marketing year ended October, vegetable oil imports were around 13.13 mln tn, lower than 13.17 mln tn during the year-ago period. Frequent changes in import duty over the last few months on edible oils disturbed the import pattern, the association had said earlier. As of Dec 1, 704,000 tn of edible oil was at ports, against 581,000 tn from a year ago, while 950,000 tn in the pipeline against 850,000 tn during the same period last year, the SEA said.

• The soymeal exports in November increased 27.4% on year to 270,000 tn, the Soybean Processors Association of India said in a release. For Oct-Nov, soymeal exports fell to 291,000 tn from 347,000 tn a year ago. Soymeal production fell in November to 559,000 tn from 918,000 tn a year ago, it was at 1.04 mln tn during Oct-Nov, lower than 1.67 mln tn during the same period a year ago. Soybean arrivals in spot markets were lower at 14,000 tn in November compared to 19,000 tn during the same time last year. During Oct-Nov, arrivals fell to 2.9 mln tn from 3.7 mln tn during the same period last year. By the end of November, mills, traders, and farmers were left with around 9.91 mln tn of soybean stock.

• The National Commodity and Derivatives Exchange will not charge transaction fees on GUAREX and SOYDEX futures contracts up to Mar 31, the bourse said in a circular. This is to encourage active participation and market development of index products.

• In its December report, the US Department of Agriculture has estimated global soybean production in 2021-22 at 381.8 mln tn, marginally lower than 384 mln tn pegged the previous month. The decline is mainly attributed to a fall in production in China due to lower area under the oilseed, though the output in Russia and the Ukraine is seen higher. The estimate for global ending stocks for 2021-22 has been scaled down to 102.0 mln tn from 103.8 mln tn the previous month. Similarly, the estimated global soymeal output for 2021-22 has been revised marginally downwards to 257.6 mln tn from 258.5 mln tn, the report said. The estimate for global exports of soymeal has been left largely unchanged at 70.8 mln tn. In the December report, the global soyoil export estimate for 2021-22 has been increased marginally to 12.7 mln tn from 12.6 mln tn estimated the previous month. However, the global soyoil production estimate for 2021-22 has been revised downwards to 61.6 mln tn in December from 61.7 mln tn pegged the previous month. According to the report, global oilseed production in 2021-22 is seen lower at 627.6 mln tn against 628.0 mln tn pegged in November, due to a decline in soybean output in China. Global vegetable oil output in 2021-22 is now seen at nearly 215.0 mln tn, against the estimate of 214.8 mln tn in November.

• The Centre cut basic duty on crude palm oil, crude soybean oil and crude sunflower oil from 2.5% to nil The agri-cess on these oils has been brought down from 20% to 7.5% for crude palm oil and 5% for crude soybean oil and crude sunflower oil, the Finance Ministry said. The basic duty on RBD Palmolein Oil, Refined Soybean and Refined Sunflower Oil has been slashed to 17.5% from the current 32.5%

• India's 2020-21 (Jul-Jun) mustard output is seen rising 22.6% on year to 8.95 mln tn, according to a joint survey by the Central Organisation for Oil Industry and Trade and the Mustard Oil Producers' Association.

• The government reduced the effective import duty on CRUDE PALM OIL to 8.25% from 24.75%, and the effective import duty on REFINED SOYOIL to 19.25% from 35.75%

• India's soybean acreage in the 2021-22 (Jul-Jun) kharif season remained unchanged at 12.2 mln ha, agri ministry.

• The base import tax on crude palm oil has been slashed to 2.5% from 10%, while the tax on crude soyoil and crude sunflower oil has been reduced to 2.5% from 7.5%, the government said in a notification late on Friday. The base import tax on refined grades of palm oil, soyoil and sunflower oil cut to 32.5% from 37.5%. After the cuts, crude palm oil, soyoil and sunflower oil imports will be subject to a 24.75% tax in total, including a 2.5% base import duty and other taxes, while refined grades of palm oil, soyoil and sunflower oil would carry a 35.75% tax in total.

• The government allowed the import of 1.2 mln tn of genetically-modified soymeal till Oct 31 to augment supply in domestic markets, the Directorate General of Foreign Trade said in a notification.

• Malaysia's crude palm oil output fell 5.3% on month to a little over 1.6 mln tn in November, according to data from the Malaysian Palm Oil Board. Persisting labour shortage issue in the country led to the decline in output. Export of palm oil in November increased 3.3% on month to 1.47 mln tn, while outbound shipments of biodiesel sharply increased by 160.2% on month to 49,972 tn. Total palm oil stocks in the country decreased 4.4% on month to around 942,354 tn as on November-end.

• Malaysia's palm oil exports during Dec 1-25 are estimated to have risen 0.2% from the previous month, cargo surveyor SGS (Malaysia) said.

• Acreage under oil palm in north-eastern states is likely to increase by 50-60% by 2025 depending on the availability of seedlings, a farm ministry source said.

• Indonesia's crude palm oil output is expected to rise 2.6% next year to 51.01 million tonnes from a 2021 estimate of 49.71 million tonnes, head of the Estate Crop Fund Eddy Abdurrachman said.

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