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SPICES

Barring jeera other spices on NCDEX posted gains on Friday. Coriander September futures on the bourse hit a four year high on festival demand and decline in arrivals in the spot market. Turmeric September futures in the meantime hit three month high on robust demand prospects. Jeera September futures succumbed to profit booking after the recent sharp rise. Rise in arrivals in the spot market weighed on as well.

Production of spices in India is likely to have risen 3.5% on year to 10.5 million ton in 2020-21 (Jul-Jun), according to data from Spices Board India.

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.

According to a survey conducted by the Federation of Indian Spice Stakeholders, jeera production in India is likely to be 478520 tons in 2020-21 (Oct-Sep), down by 11 per cent yoy.

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.

Coriander production in Gujarat is expected to rise 55 per cent to 216680 tonnes in 2020-21 season (Jul-Jun) due to sharp rise in acreage according to the state’s farm department’s second advance estimates.

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.

OILSEED

Except soyoil, all commodities in the oilseed complex on Wednesday. Sep RM seed prices traded higher due to decline in arrivals on lean back of lean season. Sep Soybean futures prices extended its positive momentum on concerns overall fall in output during this season. CPO MCX Aug futures traded higher tracking gains in International BMD Malaysian palm oil futures prices. While, Refined Soy oil Sep futures also down on as traders refrain to government cut import duty to cool off domestic prices

The government has slashed duty on import of both crude and refined soyoil and sunflower oil till Sep 30 to boost supply, according to an official notification issued. The government has cut import duty on crude soyoil and sunflower oil to 7.5% from 15%. It also slashed duty on imports of refined versions of both soyoil and sunflower oil to 37.5% from 45%, as per the notification.

Area under soybean in the 2021-22 (Jul-Jun) kharif season was down 2% on year at 11.6 mln ha so far, according to data released by the farm ministry.

India's vegetable oil imports fell 35.4% on year to 980,624 tn in July, the Solvent Extractors' Association of India. During Nov-Jul, the country imported nearly 9.7 mln tn of vegetable oil, down 2% from the year-ago period.

 The farm ministry in its fourth advance estimates cut the output estimate of soybean crop to 12.6 mln tn from 13.4 mln tn pegged in the third advance estimates.

The government is in favour of imports of genetically modified soymeal to ramp up domestic supply and support the poultry industry.

India's oilmeal exports declined 11% on year to 203,612 tn in June, according to data from The Solvent Extractors' Association of India today. For Apr-Jun, overall exports of oilmeal rose 27% on year to 735,312 tn.

 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 has slashed import duty on crude palm oil, refined, bleached and deodorised palm oil, palmolein, palm stearin and other palm oils with effect from Wednesday until Sep 30. Govt cuts import duty on crude palm oil to 10% and RBD palm oil & RBD palmolein to 37.5%.

 Soymeal exports in July declined 73.1% on year to 25,000 tn, according to a release from the Soybean Processors Association of India. Overseas shipments of soymeal fell because of tepid demand from traditional buyers. Importers are turning to South American countries for cheaper soymeal. Higher domestic soybean prices due to paucity of stocks in spot markets jacked up export prices. During Oct-Jul, soymeal exports were at 1.93 mln tn against 687,000 tn during same period last year.

 India's 2020-21 (Jul-Jun) mustard output is seen rising to 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 US Department of Agriculture has scaled down its estimate for global oilseed production in 2021-22 to 629.5 mln tn from 635.4 mln tn projected in July. The downward revision is due to lower production of canola in Canada and sunflower seed in Russia. Canada's canola crop estimate has been lowered by 4.2 mln tn to 16 mln tn due to drought in the Canadian Prairies. The estimate for Russia's sunflower seed crop has been cut by 1.0 mln tn to 15.5 mln tn due to dry weather conditions. However, the US agency has scaled up its forecast for Ukraine's sunflower seed output, as a wet spring followed by good rains in southern Ukraine in June and July improved yield potential. The agency also scaled down its global soybean output view to 383.6 mln tn from 385.2 mln tn in July. Global soybean ending stocks are now pegged higher at 96.2 mln tn, against the previous estimate of 94.5 mln tn. The agency cut its soybean output estimate for the US to 118.1 mln tn from 119.9 mln tn in July.

 Crushing of mustard seeds by oil millers declined over 31% on year to 550,000 tn in July, data from Marudhar Trading Agency. Mills had crushed 800,000 tn of the oilseed during the same period last year, and in June this year, they crushed 600,000 tn of mustard. Low arrivals in physical markets hit crushing operations. Arrivals of the oilseed fell to almost 500,000 tn in July from 640,000 tn a year ago.

India is likely to produce around 10 mln tn of mustard in 2020-21 (Jul-Jun), up 35% from a year ago, due to higher acreage and favourable weather conditions, according to the Solvent Extractors' Association of India.

 Farmers in the country have sown mustard across 6.9 mln ha, up 10.6% on year, in 2020-21 (Jul-Jun) season so far, data from the farm ministry.

 Indian government slashed import duty of crude palm oil. The government cut import duty on crude palm oil by 10% to 27.5%, in the last week, to cool off soaring edible oil prices in domestic markets.

 India is likely to grow a record 10 mln tn mustard crop in 2020-21 (Jul-Jun), mainly due to the likelihood of a sharp rise in acreage, according to Solvent Extractors' Association of India. The government has targeted an alltime high crop of 12.5 mln tn for this rabi season. The government has fixed the minimum support price at 4,650 rupees per 100 kg for 2020-21 (Apr-Mar) marketing season against 4,425 rupees per 100 kg the previous year.

 According to the first advance estimates for 2020-21 (Jul-Jun), castor seed output is seen at 1.7 mln tn compared with 1.8 mln tn in the fourth advance estimates for 2019-20, according to the data released by the farm ministry. While, according to traders, crop is seen at 1.5-1.6 mln tn. Farmers have sown castor seed across 792,000 ha in 2020-21 (Jul-Jun), down 16% from a year ago.

 India's exports of castor oil rose 18.7% on year to nearly 650,000 tn in 2020-21 (Apr-Mar), said B.V. Mehta, executive president, The Solvent Extractors' Association of India. Exports were at 547,646 tn in 2019-20.

Malaysia's crude palm oil output fell 5.2% on month to a little over 1.5 mln tn in July, data from the Malaysian Palm Oil Board showed. Total palm oil stocks in the country decreased 7.3% on month to around 1.5 mln tn. The export of palm oil in July fell 0.8% on month to 1.4 mln tn, while that of biodiesel fell 40.2% on month to 23,838 tn. Palm oil is used to make biofuel.

 Private cargo surveyor Amspec Agri said that palm oil exports for Aug 1-10 fell 10% on month to 368,763 tn.

COTTON

The area under cotton across the country in the 2021-22 (Jul-Jun) season was at 11.6 mln ha as of Thursday, down 7% from a year ago, data from the farm ministry showed.

 The US Department of Agriculture has scaled down its estimate for global production of cotton in 2021-22 (Aug-Jul) to 118.8 mln bales (1 US bale = 218 kg) from 119.4 mln bales projected a month ago. The downward revision in global production estimate is mainly due to a likely lower crop in the US, Brazil and Uzbekistan. In the US, production is seen at 17.3 mln bales in 2021-22 compared with 17.8 mln bales estimated earlier. Global cotton consumption is seen a tad higher at 123.3 mln bales in 2021-22, driven by a likely rise in demand from Bangladesh and Pakistan. Global exports are estimated at 46.3 mln bales, higher than the earlier projection of 45.9 mln. The agency has lowered its 2021-22 global ending stocks estimate to 87.2 mln bales from 87.7 mln bales. The output estimate for India, the top producer, is maintained at 29.0 mln bales for 2021-222. Consumption for the country is seen at 25.5 mln bales. The average price for US upland cotton is expected to rise by 5 cents per pound to 80 cents during the current season, highest since 2011-12, the agency said.

 The Cotton Association of India has scaled up its export estimate for 2020-21 (Oct-Sep) to 7.7 mln bales (1 bale = 17 kg) from 7.2 mln bales projected earlier. In the current marketing year, India shipped around 7.0 mln bales till July. The association has also raised its domestic consumption view to 33.0 mln bales, from 32.5 mln bales estimated earlier. It has lowered its ending stock estimate to 8.3 mln bales, against 9.4 mln bales. Production and import estimates for the year are seen at 35.5 mln bales and 1.0 mln bales, respectively. Production in the northern region, which includes Punjab, Haryana and Rajasthan, is seen at 6.6 mln bales. In the central zone, which includes Gujarat, Maharashtra and Madhya Pradesh, the output is estimated at 19.4 mln bales. In the southern region, production is pegged at 9.1 mln bales. Of the total crop, around 34.9 mln bales had arrived in markets across India till July.

The USDA has maintained its estimate for cotton output in India at 29.0 mln bales (1 US bale = 218 kg) in 2021-22 (Aug-Jul). The estimated production is up 2.5% on year, the agency said in a monthly report. The area under cotton is seen at 12.9 mln ha in 2021-22, compared with an estimated 13.0 mln ha the previous year. As of Aug 5, farmers in India had sown cotton across 11.6 mln ha in the 2021-22 (Jul-Jun) season, down 6% on year. India's cotton consumption in 2021-22 is projected at 25.5 mln bales, 6% higher on year. Export estimate is seen at 6.2 mln bales, down 1.5% on year. Bangladesh, China, Vietnam and Indonesia are top cotton export destinations. Imports for India in the 2021-22 crop year are also maintained at 1.0 mln bales. The closing stock of cotton for the country has been pegged at 14.0 mln bales, compared with 14.3 mln bales estimated in the previous month.

A slow progress of the southwest monsoon in the first half of July and unequal spread subsequently may prompt farmers to shift to cotton and maize from oilseeds in 2021-22 (Jul-Jun), CRISIL Research said in a report. • India's cotton exports remained subdued in July as record high prices in the domestic markets made Indian product uncompetitive, trade officials said. India exported 350,000-400,000 bales (1 bale = 170 kg) of cotton in July, largely steady from June, but almost half of the 700,000-800,000 bales exported each in March and April. • The International Cotton Advisory Committee has scaled up its forecast for global prices in 2021-22 (AugJul) as ending stocks for the ongoing season are estimated to be lower. The committee has reported that the overall economic recovery, a rejuvenated textile and apparel sector and a demand-led increase in cotton exports have resulted in a lower beginning stocks for 2021-22 season at 20.9 mln tn. In 2021-22 season, the committee has estimated global consumption at 25.8 mln tn, compared with 25.6 mln tn last. Global exports are seen marginally lower at 10.2 mln tn, compared with 10.4 mln tn a year ago. Global ending stocks for the season are estimated at 20.2 mln tn, compared with 20.9 mln tn in the previous season. Global production for the ongoing season is estimated at 25.1 mln tn, up 3% from the previous season. The rise in estimate has largely been attributed to a sharp rise of around 22% in production in the US. Production in India, is expected to be 5.9 mln tn, compared with 6.1 mln tn in the previous year. In the US, cotton production is estimated at 3.9 mln tn, against 3.2 mln tn a year ago.

 The UK-based Cotton Outlook has scaled up its estimate for global production in 2021-22 (Aug-Jul) by 520,000 tn to 25.8 mln tn in its July report. The estimate has been revised upwards as production in the US and Australia is expected to be higher due to favourable weather conditions. Output in US has been scaled upwards by 330,000 tn to 3.9 mln tn. Cotton production in India, is seen at 6.3 mln tn. The agency has also scaled up its estimate for global consumption in 2021-22 by 100,000 tn to 26.0 mln tn owing to strong demand from Bangladesh and Turkey.

 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.

 The area under major kharif crops so far in 2020-21 (Jul-Jun) was at 111.7 mln ha, up nearly 5% from a year ago, farm ministry data showed. Farmers have sown cotton across 13.04 mln ha in the 2020-21 (JulJun) season, up by 2.1% from a year ago, as of 25th Sept., farm ministry.

India's cotton output in the 2020-21 (Oct-Sep) marketing year is seen at 38.0 mln bales (1 bale = 170 kg), up 4% on year, according to traders' pegs 2020-21 cotton crop at 37.1 mln bales vs 35.5 mln bales.

OTHERS

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.

 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.

 Govt. procures nearly 700000 tons of chana in 2021-22 rabi marketing season

 The government exempted pulse importers from stockholding limits, but they are still required to declare their stocks on the Department of Consumer Affairs portal, an official release said. On Jul 2, the government imposed stockholding limits on pulses, barring moong, to curb the rise in prices. The limits, which were to be effective till Oct 31, had been applied on wholesalers, millers, retailers and importers. The government has also revised upwards the stockholding limits for wholesalers to 500 tn, provided there isn't more than 200 tn of one variety, the release said. The limit that had been imposed on wholesalers earlier was 200 tn, provided there was not more than 100 tn of one variety of pulse. For millers, the limit now will be the last six months of production or 50% of annual installed capacity, whichever is higher, the release said. Earlier, the limit was three months of production or 25% of annual installed capacity, whichever was higher. All the stakeholders--wholesalers, retailers, millers, and importers--are required to reduce the stocks with them to the prescribed limit within 30 days after they declare excess stocks, the release said. The government has procured 545980 tons of chana harvested in 2020-21 rabi season.

Govt. pegs 2020-21 chana output to be at 12.6 million tonnes compared to 11.1million tonnes a year ago.

 Guar complex on NCDEX continued rising on concerns over fall in acreage in the major guar producing state of Rajasthan.

The area under guar stood at 14.1 million hectares in 2021-22 season compared to 16.38 million hectares sown during the same period last year in the major growing state of Rajasthan, according to the data released by Rajasthan state agriculture department.

 India’s guar gum exports declined in the month of May 2021 by 2.25% to 20,340 tonnes compared to 20,808 tonnes during March 2021 at an average FoB of US $ 1676 per tonne in the month of May 2021 as compared to US $ 1392 per tonne in the month of March 2021. Further, the gum shipments were up by 19% in May 2021 compared to the same period last year. Of the total exported quantity, around 6,438 tonnes is bought US, Russia (2,959 tonnes) and Thailand (2,81 tonnes).

Natural rubber in the Indian markets traded firm in the spot market on Friday, while it ended down on MCX, probably on profit booking.

 The International Rubber Study Group (IRSG) expects global natural rubber consumption to increase by 7% in 2021, after declining 8.1% in 2020 because of the pandemic, secretary general Salvatore Pinizzotto said.

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