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Gold

Gold yesterday settled up by 0.21% at 48400 getting support from U.S. Federal Reserve Chair Jerome Powell's dovish comments and some concerns over a stalling global economy. Powell in congressional testimony said the U.S. job market "is still a ways off" from the progress that the central bank wants to see before reducing its support for the economy, driving gold prices to a one-month peak earlier in the session.

The number of Americans filing new claims for unemployment benefits fell to a 16-month low last week as the labor market steadily gains traction, but worker shortages are frustrating efforts by businesses to ramp up hiring to meet strong demand for goods and services. Federal Reserve Chair Jerome Powell said the U.S. central bank is looking into using climate stress scenarios to make banks more aware of and resilient to ever-more-frequent severe weather events, and could go in that direction.

Climate stress scenarios, as distinct from regular stress tests, are "proving to be... a very profitable exercise, both for the financial institutions and for regulators" in Europe where central banks have begun using them, Powell told the Senate Banking Committee.

Technically market is under short covering as market has witnessed drop in open interest by -7.07% to settled at 7742 while prices up 101 rupees, now Gold is getting support at 48207 and below same could see a test of 48013 levels, and resistance is now likely to be seen at 48548, a move above could see prices testing 48695.

Trading Ideas:
# Gold trading range for the day is 48013-48695.
# Gold gains getting support from U.S. Fed Chair Jerome Powell's dovish comments and some concerns over a stalling global economy.
# Fed's Powell signals he's open to using climate stress scenarios
# Powell says tapering 'still a ways off'
 

Silver

Silver yesterday settled up by 0.39% at 69681 after U.S. Federal Reserve Chair Jerome Powell reassured investors that the central bank would continue its accommodative monetary policy despite a spike in inflation readings. Powell, in prepared remarks before a congressional hearing, said the US job market “is still a ways off” from the progress the Fed wants to see before reducing its support for the economy, while current high inflation will ease in the coming months.

U.S. import prices increased solidly in June as bottlenecks in the global supply chain persisted, the latest indication that inflation could remain elevated for a while amid strong domestic demand fueled by the economy's reopening and fiscal stimulus. Still, prices appeared to have peaked. Import prices rose 1.0% last month after surging a 1.4% in May, the Labor Department said on Thursday. The eighth straight monthly gain left the year-on-year increase at 11.2% compared with 11.6% in May.

The government reported this week that consumer prices increased by the most in 13 years in June, while producer prices accelerated. Factory activity in the U.S. mid-Atlantic region slowed sharply for the third consecutive month to its lowest growth since December after hitting its highest pace in nearly half a century earlier this spring, a survey showed.

Technically market is under short covering as market has witnessed drop in open interest by -1.5% to settled at 10079 while prices up 269 rupees, now Silver is getting support at 69425 and below same could see a test of 69169 levels, and resistance is now likely to be seen at 69913, a move above could see prices testing 70145.

Trading Ideas:
* Silver trading range for the day is 69169-70145.
* Silver gained after Fed Chair Powell reassured investors that the central bank would continue its accommodative monetary policy
* Powell told that the U.S. economy is "a ways off" from where it needs to be for the Fed to tighten its easy monetary policy.
* Data showed US consumer price and producer price indexes surged last month.

Crude oil

Crude oil yesterday settled down by -1.28% at 5381 as investors braced for increased supplies after a compromise deal between leading OPEC producers and as U.S. fuel stocks rose, raising concerns over demand in the world’s largest consumer. U.S. crude oil stockpiles fell for the eighth straight week last week, as renewed vigor in the U.S. economy continues to drive higher fuel demand, the Energy Information Administration said.

The report was delayed for one hour due to technical issues, the EIA said. Saudi Arabia and the United Arab Emirates have reached a compromise over OPEC+ policy, an OPEC+ source said, in a move that should unlock a deal to supply more crude to a tight oil market and cool soaring prices.

Brent oil prices fell on the news by as much as $1 per barrel towards $75 per barrel after Reuters reported the two major OPEC producers had agreed a deal. The oil market will see tighter supply for now amid a dispute inside OPEC+ about how to ease production curbs but it still faces the risk of a dash for market share if disagreement persists, the IEA said. The Paris-based agency said oil prices would be volatile until differences were resolved among members of OPEC+.

Technically market is under long liquidation as market has witnessed drop in open interest by -13.74% to settled at 2876 while prices down -70 rupees, now Crude oil is getting support at 5329 and below same could see a test of 5277 levels, and resistance is now likely to be seen at 5435, a move above could see prices testing 5489.

Trading Ideas:
* Crude oil trading range for the day is 5277-5489.
* Crude oil dropped as investors braced for increased supplies after a compromise deal between leading OPEC producers and as U.S. fuel stocks rose.
* U.S. crude stockpiles fall for eighth week in a row - EIA
* Saudi, UAE reach compromise to unlock more oil supply, says source

Natural gas
Nat.Gas yesterday settled down by -0.59% at 271.1 on a bigger-than-expected storage build and forecasts for less hot weather and lower air conditioning demand over the next two weeks than previously expected. That price decline came ahead of a federal report expected to show a smaller-than-usual storage build last week when production was lower and exports were rising.

Data provider Refinitiv said U.S. output in the Lower 48 states slipped to 91.3 billion cubic feet per day (bcfd) so far in July, due mostly to pipeline problems in West Virginia earlier in the month. That compares with an average of 92.2 bcfd in June and an all-time high of 95.4 bcfd in November 2019.

Refinitiv projected average gas demand, including exports, would rise from 91.5 bcfd this week to 93.1 bcfd next week as the weather turns seasonally hotter. Those forecasts were lower than Refinitiv projected. The amount of gas flowing to U.S. liquefied natural gas (LNG) export plants averaged 10.9 bcfd so far in July, up from 10.1 bcfd in June but still below the record 11.5 bcfd in April. U.S. pipeline exports to Mexico, meanwhile, averaged 6.5 bcfd so far in July, down from a record 6.8 bcfd in June.

Technically market is under fresh selling as market has witnessed gain in open interest by 0.74% to settled at 14520 while prices down -1.6 rupees, now Natural gas is getting support at 268.6 and below same could see a test of 266 levels, and resistance is now likely to be seen at 274.3, a move above could see prices testing 277.4.

Trading Ideas:
* Natural gas trading range for the day is 266-277.4.
* Natural gas slipped on a bigger-than-expected storage build and forecasts for less hot weather and lower air conditioning demand
* The U.S. EIA said U.S. utilities added 55 billion cubic feet (bcf) of gas into storage during the week ended July 9.
* Data provider Refinitiv said U.S. output in the Lower 48 states slipped to 91.4 billion cubic feet per day (bcfd) so far in July

Copper

Copper yesterday settled up by 0.96% at 728.25 as lower than expected growth from top consumer China stoked hopes for more support for the world’s second-largest economy. China’s growth in the second quarter undershot expectations owing to slowing manufacturing activity, higher raw material costs and new COVID-19 outbreaks.

Meanwhile, U.S. Fed chairman Jerome Powell told Congress he saw no need to rush the shift towards tighter post-pandemic monetary policy, which bodes well for liquidity and metals demand. The discount of LME cash copper to the three-month contract expanded to $39.95 a tonne, its widest since August 2018, as on-warrant inventories in LME warehouses rose to 207,575 tonnes, their highest since May 2020.

The Yangshan copper premium climbed to $32.50 from $21.50 in June, which was its lowest since February 2016. This pointed to a rebound in demand for imported metal into China. Freeport McMoRan will not proceed with plans to build a new copper smelter with China’s Tsingshan Holding Group, its local Indonesian unit, PT Freeport Indonesia’s spokesman told. Output at U.S. factories unexpectedly fell in June as motor vehicle production dropped amid an unrelenting global semiconductor shortage.

Technically market is under short covering as market has witnessed drop in open interest by -23.68% to settled at 3620 while prices up 6.95 rupees, now Copper is getting support at 722.9 and below same could see a test of 717.4 levels, and resistance is now likely to be seen at 733.4, a move above could see prices testing 738.4.

Trading Ideas:
* Copper trading range for the day is 717.4-738.4.
* Copper prices rose as lower than expected growth from top consumer China stoked hopes for more support for the world’s second-largest economy.
* China’s growth in the second quarter undershot expectations owing to slowing manufacturing activity, higher raw material costs and new COVID-19 outbreaks.
* The discount of LME cash copper to the three-month contract expanded to $39.95 a tonne, its widest since August 2018

Zinc

Zinc yesterday settled up by 1.09% at 241.8 as support seen after China’s Q2 GDP increased 7.9% on the year, the growth shrank significantly from the previous quarter, so China’s economic recovery may further slowdown in H2 2021.

At fundamentals, the released national reserves are expected to be received by downstream users next week, and the supply will increase on week. Operating rates in downstream processing plants generally declined, especially in the galvanising companies, indicating that the industry is gradually entering the off-peak season of consumption.

However, the overall social inventory remained low, leading to relatively high spot premiums in Shanghai and Guangdong. U.S. import prices increased solidly in June as bottlenecks in the global supply chain persisted, the latest indication that inflation could remain elevated for a while amid strong domestic demand fueled by the economy's reopening and fiscal stimulus.

Still, prices appeared to have peaked. Import prices rose 1.0% last month after surging a 1.4% in May, the Labor Department said. The eighth straight monthly gain left the year-on-year increase at 11.2% compared with 11.6% in May. The government reported this week that consumer prices increased by the most in 13 years in June, while producer prices accelerated.

Technically market is under fresh buying as market has witnessed gain in open interest by 38.88% to settled at 2247 while prices up 2.6 rupees, now Zinc is getting support at 240.2 and below same could see a test of 238.4 levels, and resistance is now likely to be seen at 243.1, a move above could see prices testing 244.2.

Trading Ideas:
* Zinc trading range for the day is 238.4-244.2.
* Zinc prices gained as support seen after China’s Q2 GDP increased 7.9% on the year.
* However, the overall social inventory remained low, leading to relatively high spot premiums in Shanghai and Guangdong.
* U.S. import prices increased solidly in June as bottlenecks in the global supply chain persisted

Nickel

Nickel yesterday settled up by 1.07% at 1410.3 amid the expectation of production cuts and the tight supply of nickel. NPI output in Indonesia stood at 77,000 mt in metal content in June, up 4.34% on the month and 65.7% on the year, with accumulated output at 426,000 mt in Ni content in 2021. There are 3 new production lines in June, 2 in Qingshan XiaoK park and 1 in Delong.

The US dollar fell after Federal Reserve Chair Jerome Powell said in remarks prepared for Congress that the economy was “still a ways off” from levels the central bank wanted to see before tapering its monetary support. His comments came a day after data showed U.S. inflation hit its highest in more than 13 years last month, which lifted the greenback to just shy of its three-month high and sharpened the focus on when central banks around the world will begin withdrawing pandemic-era stimulus.

That focus intensified on Wednesday after the Bank of Canada said it would cut its weekly bond purchases to C$2 billion ($1.6 billion) from C$3 billion, and the Reserve Bank of New Zealand said it was ending bond purchases, raising expectations it could increase rates as soon as August.

Technically market is under fresh buying as market has witnessed gain in open interest by 24% to settled at 2692 while prices up 14.9 rupees, now Nickel is getting support at 1398.5 and below same could see a test of 1386.8 levels, and resistance is now likely to be seen at 1417.7, a move above could see prices testing 1425.2.

Trading Ideas:
* Nickel trading range for the day is 1386.8-1425.2.
* Nickel prices gained amid the expectation of production cuts and the tight supply of nickel.
* NPI output in Indonesia stood at 77,000 mt in metal content in June, up 4.34% on the month and 65.7% on the year
* Fed’s Powell said that the economy was “still a ways off” from levels the central bank wanted to see before tapering its monetary support.

Aluminium

Aluminium yesterday settled down by -0.05% at 198.85 paring all gains as China's primary aluminium output in June fell for a second straight month, official data showed, as limits on power consumption in the smelting hub of Yunnan reined-in production. The world's top producer of the metal churned out 3.29 million tonnes in June, the National Bureau of Statistics (NBS) said. That was down from May's 3.32 million tonnes, but up 9.3% year on year.

Yunnan, home to about a tenth of China's aluminium capacity thanks to abundant hydropower resources, ordered smelters to reduce energy consumption in late May after severe drought hampered electricity generation. China's first half aluminium output hit the highest half-yearly production levels since at least 2015, according to Statistics Bureau records. Global liquidity remained loose. Aluminium consumption is entering the off-peak season.

However, the aluminium ingot inventory stood at 832,000 mt on July 15, still not in the accumulation period. The power rationing policies in Yunnan and Henan had more impact on the supply side than on the demand. The number of Americans filing new claims for unemployment benefits fell to a 16-month low last week as the labor market steadily gains traction, but worker shortages are frustrating efforts by businesses to ramp up hiring to meet strong demand for goods and services.

Technically market is under long liquidation as market has witnessed drop in open interest by -5.1% to settled at 2307 while prices down -0.1 rupees, now Aluminium is getting support at 198.1 and below same could see a test of 197.3 levels, and resistance is now likely to be seen at 199.8, a move above could see prices testing 200.7.

Trading Ideas:
* Aluminium trading range for the day is 197.3-200.7.
* Aluminium prices pared gains as China June aluminium falls for 2nd month as power curbs weigh
* China's first half aluminium output hit the highest half-yearly production levels since at least 2015, according to Statistics Bureau records.
* The power rationing policies in Yunnan and Henan had more impact on the supply side than on the demand.

Mentha oil 

Mentha oil yesterday settled down by -2.48% at 957 as average yield in Barabanki is improved by 5-6 kgs per acre due to better weather. Support also seen due to the rotting of the crop due to stagnant water in the field. The past few weeks have been painful as heavy rains in the pre-monsoon season have damaged the mentha crop which was ready for harvesting.

Due to drowning in the water, the rows have started to wither. With the harvesting of the crop, oil extraction work has also started. However upside seen limited as arrivals likely to increase due to favourable weather conditions. Daily arrivals should gradually pick up to 400-500 drums in next 7-10 days.

Last week, prices rallied. The Lucknow-based Central Institute of Medicinal and Aromatic Plants estimates that this adverse effect of rains on the crop is expected to reduce production by 30% in the last two weeks. The crop is prone to rain because the leaves of the crop start falling due to waterlogging in the field. Most of the farmers have planted Mentha crops and this rain is not less than acid for 50 percent of Mentha crop. In Sambhal spot market, Mentha oil dropped by -31.5 Rupees to end at 1050 Rupees per 360 kgs.

Technically market is under fresh selling as market has witnessed gain in open interest by 1.99% to settled at 1026 while prices down -24.3 rupees, now Mentha oil is getting support at 942.4 and below same could see a test of 927.7 levels, and resistance is now likely to be seen at 976.4, a move above could see prices testing 995.7.

Trading Ideas:
* Mentha oil trading range for the day is 927.7-995.7.
* In Sambhal spot market, Mentha oil dropped  by -31.5 Rupees to end at 1050 Rupees per 360 kgs.
* Mentha oil prices dropped as average yield in Barabanki improved
* Prices gained in recent sessions due to the rotting of the crop due to stagnant water in the field.
* The past few weeks have been painful as heavy rains in the pre-monsoon season have damaged the mentha crop which was ready for harvesting.

Soyabean

Soyabean yesterday settled up by 0.92% at 7478 as planting of overall oilseeds, including soybean was at 11.2 million hectares, down from 12.6 million hectares the previous year. A “break” in the monsoon has affected Kharif sowing in many parts of the country this year.

However, area under soybean planting is likely to increase by 5-7% across the country this kharif season despite speculation in the market over the shortage of seeds. Farmers, however, are keeping their fingers crossed due to the break in monsoon and hope for a revival of the monsoon to ensure a good crop. In the 2020 kharif season, soybean cultivation took place on 120 lakh hectares and the yield was about 105 lakh tonne.

China's soybean imports in June hit their third-highest monthly level on record, customs data showed, boosted by a jump in shipments from Brazil. China, the world's top buyer of the oilseed, took 10.72 million tonnes in June, slightly below a record 11.16 million tonnes in the corresponding month a year earlier, the data showed, as Brazilian soybean cargoes cleared customs.

The imports were up 11.6% from 9.61 million tonnes in May, data from the General Administration of Customs showed. At the Indore spot market in top producer MP, soybean dropped -9 Rupees to 7744 Rupees per 100 kgs.Technically market is under fresh buying as market has witnessed gain in open interest by 7.31% to settled at 37960 while prices up 68 rupees, now Soyabean is getting support at 7423 and below same could see a test of 7367 levels, and resistance is now likely to be seen at 7530, a move above could see prices testing 7581.

Trading Ideas:
* Soyabean trading range for the day is 7367-7581.
* Soyabean gained as planting of overall oilseeds, including soybean was at 11.2 mln hec, down from 12.6 mln hec the previous year.
* There has been shortage of certified seeds and they have been selling at high prices, but farmers have prepared their own seeds.
* China's June soybean imports hit third highest monthly level
* At the Indore spot market in top producer MP, soybean dropped  -9 Rupees to 7744 Rupees per 100 kgs.

Soya Oil

Ref.Soyaoil yesterday settled up by 0.98% at 1350.3 supported by lingering concerns over tight supply. China raised its forecast on imports of edible oils in 2020/21 marketing year, on increase of palm oil and sunflower oil shipments, the country's agriculture ministry said.

China's 2020/21 edible oils imports were seen at 10.23 million tonnes, up 900,000 tonnes from last month's forecast, the Ministry of Agriculture and Rural Affairs said in its monthly crop report. Estimates on output, planting acreage and imports of corn, soybeans and cotton in the 2021/22 year remain unchanged from a month ago, according to the ministry. China's soybean acreage in 2021/22 year was seen at 9.347 million hectares, down 5.4% from 9.882 million hectares in the previous year, according to the report.

India has slashed the base import price of palm oil and soyoil, the government said in a statement, as prices fell in the overseas market. India exported 5.31 lakh tonnes of oilmeals in the first two months of the fiscal 2021-22 against 3.50 lakh tonnes in the same period a year ago, recording a growth of 52 per cent. BV Mehta, Executive Director of Solvent Extractors’ Association of India (SEA), said the export of oilmeals increased sharply on the back of shipments of rapeseed meal during the period. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1358.75 Rupees per 10 kgs.

Technically market is under short covering as market has witnessed drop in open interest by -2.43% to settled at 36270 while prices up 13.1 rupees, now Ref.Soya oil is getting support at 1340 and below same could see a test of 1330 levels, and resistance is now likely to be seen at 1358, a move above could see prices testing 1366.

Trading Ideas:
* Ref.Soya oil trading range for the day is 1330-1366.
* Ref soyoil gained supported by lingering concerns over tight supply.
* China raised its forecast on imports of edible oils in 2020/21 marketing year, on increase of palm oil and sunflower oil shipments.
* China's 2020/21 edible oils imports were seen at 10.23 million tonnes, up 900,000 tonnes from last month's forecast
* At the Indore spot market in Madhya Pradesh, soyoil was steady at 1358.75 Rupees per 10 kgs.

Crude palm Oil

Crude palm Oil yesterday settled up by 1% at 1079.1 as concerns over slow output growth offered support. European Union palm oil imports in the 2021/22 season fell to 80,608 tonnes versus 214,613 tonnes in 2020/21, European Commission data showed.

Plantations in Malaysia are entering the seasonal higher production months, but analysts are anticipating a small uptick in July output as a labour shortage continues to hamper harvesting. India's palm oil and soyoil imports plunged by nearly a quarter in June from a month ago, a leading trade body said in a statement, as refiners postponed purchases anticipating a reduction in the import tax.

The country's palm oil imports in the month dropped 24% from a month ago to 587,467 tonnes, while soyoil purchases fell by 23% to 206,262 tonnes, the Solvent Extractors' Association of India (SEA) said in a statement. India's sunflower oil imports in June were steady at 175,702 compared to 175,759 tonnes in May, it added. India buys palm oil from Indonesia and Malaysia while other oils, including soyoil and sunflower oil, are sourced from Argentina, Brazil, Ukraine and Russia. Palm oil imports are likely to jump above 750,000 tonnes in July as buyers are aggressively making purchases.

In spot market, Crude palm oil gained by 7.6 Rupees to end at 1081 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -10.24% to settled at 4434 while prices up 10.7 rupees, now CPO is getting support at 1072.2 and below same could see a test of 1065.2 levels, and resistance is now likely to be seen at 1084.5, a move above could see prices testing 1089.8.

Trading Ideas:
* CPO trading range for the day is 1065.2-1089.8.
* Crude palm oil gains as concerns over slow output growth offered support.
* European Union palm oil imports in the 2021/22 season fell to 80,608 tonnes versus 214,613 tonnes in 2020/21
* India's palm oil and soyoil imports plunged by nearly a quarter in June from a month ago
* In spot market, Crude palm oil gained  by 7.6 Rupees to end at 1081 Rupees.

Mustard Seed

Mustard Seed yesterday settled up by 0.6% at 7187 as the arrival of mustard in the mandis has decreased at all places in the country. U.S. rapeseed production is forecast to reach a record 1.8 million tons on record area and trend yield. Pressure also seen as Canada rapeseed production is projected at 20.5 million tons, up 1.5 million on greater area. U.S. rapeseed production is forecast to reach a record 1.8 million tons on record area and trend yield.

Pressure also seen as Canada rapeseed production is projected at 20.5 million tons, up 1.5 million on greater area. COOIT was against any reduction in import duties on edible oils but wanted the Centre to remove the GST of 5 per cent on mustard seed and oil as it will help farmers and consumers both. European Union rapeseed production is projected to show a modest gain in 2021/22 on increased planted area and improved yield but will remain below the levels observed from 2016 to 2018.

In Alwar spot market in Rajasthan the prices gained 77.25 Rupees to end at 7428 Rupees per 100 kg.Technically market is under short covering as market has witnessed drop in open interest by -1.05% to settled at 48820 while prices up 43 rupees, now Rmseed is getting support at 7141 and below same could see a test of 7094 levels, and resistance is now likely to be seen at 7235, a move above could see prices testing 7282.

Trading Ideas:
* Rmseed trading range for the day is 7094-7282.
* Mustard seed prices gained tracking firmness in overseas prices as drought continued across the Canadian Prairies, threatening crop yields.
* The arrival of mustard in the mandis has decreased at all places in the country.
* U.S. rapeseed production is forecast to reach a record 1.8 million tons on record area and trend yield.
* In Alwar spot market in Rajasthan the prices gained 77.25 Rupees to end at 7428 Rupees per 100 kg.

Turmeric 

Turmeric yesterday settled up by 0.68% at 7388 as turmeric crops were severely damaged in Parbhani and Hingole due to heavy rains. Support also seen on following export demand from Europe, Gulf countries and Bangladesh. However upside seen limited as sentiment is weak and sluggish demand from local stockists amid poor quality arrivals in the market has led to the fall in prices.

The curbs and lockdowns announced to control the second wave of Covid-19 pandemic affected trading. In Nizamabad APMC in Telangana, the modal price of the finger variety turmeric was quoted at ₹6,950 a quintal. Prices are up about ₹400 since the beginning of this month. At Bangalore in Karnataka, turmeric is quoted at ₹11,500 at the APMC yard with most markets closed in the State to control the Covid-19 pandemic.

In Tamil Nadu, too, the agricultural markets are closed as part of the lockdown to tackle the pandemic. Demand for exports to Bangladesh and Europe are helping turmeric prices to gain. Exporters are looking to pick up stocks from Nanded in view of its quality. Turmeric has been in demand over the last two years as it is reported to be effective in medical use, particularly in combating Covid-19.

In Nizamabad, a major spot market in AP, the price ended at 7254.15 Rupees dropped -1.8 Rupees.Technically market is under short covering as market has witnessed remain unchanged in open interest by 0% to settled at 11870 while prices up 50 rupees, now Turmeric is getting support at 7324 and below same could see a test of 7258 levels, and resistance is now likely to be seen at 7442, a move above could see prices testing 7494.

Trading Ideas:
* Turmeric trading range for the day is 7258-7494.
* Turmeric prices gained as turmeric crops were severely damaged in Parbhani and Hingoli due to heavy rains.
* Support also seen on following export demand from Europe, Gulf countries and Bangladesh.
* However upside seen limited as sentiment is weak and sluggish demand from local stockists amid poor quality arrivals in the market has led to the fall in prices.
* In Nizamabad, a major spot market in AP, the price ended at 7254.15 Rupees dropped -1.8 Rupees.

 

Jeera

Jeera yesterday settled up by 0.64% at 13275 as only 45-50 percent of the total production has come to the market. In recent sessions, prices dropped amid excess supply and as demand is likely to remain subdued on weak buying from local and overseas markets. Farmers need money to start sowing the kharif crop and they are bringing huge stocks to sell in the market after the easing of Covid-related restrictions.

In the benchmark market Unjha, 7,000 bags (1 bag = 55 kg) arrived yesterday as against 10,000 bags. As India struggles against curbing the Corona pandemic, exports markets have turned subdued. The importers prefer to wait for the situation to normalize before negotiating for fresh deals. They rather prefer to clear their older stocks first and presently they feel that the older inventory may be sufficient to balance the existing demand for next few weeks easily.

The new season arrivals shall continue with good numbers hence there will be ample availability in the market. However from a broader perspective, India’s exports outlook has brightened while crop is expected to be lower versus year on year. Also, the nearest export competitors i.e. Turkey and Syria may not supply much to the world due to lower exportable surplus.

In Unjha, a key spot market in Gujarat, jeera edged up by 61.25 Rupees to end at 13490 Rupees per 100 kg.Technically market is under short covering as market has witnessed drop in open interest by -0.78% to settled at while prices up 85 rupees, now Jeera is getting support at 13180 and below same could see a test of 13090 levels, and resistance is now likely to be seen at 13370, a move above could see prices testing 13470.

Trading Ideas:
* Jeera trading range for the day is 13090-13470.
* Jeera prices gained as only 45-50 percent of the total production has come to the market.
* In recent sessions, prices dropped amid excess supply and as demand is likely to remain subdued on weak buying from local and overseas markets.
* Farmers need money to start sowing the kharif crop and they are bringing huge stocks to sell in the market after the easing of Covid-related restrictions.
* In Unjha, a key spot market in Gujarat, jeera edged up by 61.25 Rupees to end at 13490 Rupees per 100 kg.
 

Cotton

Cotton yesterday settled up by 0.31% at 25580 as the area of cotton cultivation in Marathwada has reduced during this kharif season as more farmers have opted for soyabean over the traditional cash crop, implying a gradual shift in the cropping pattern in the region.

Cotton sowing has taken place only on 67% of the expected area of 6.97 lakh hectare in the Aurangabad division and 65% of the expected area (3.58 lakh hectare) in the Latur division. India’s cotton ending stocks could be lower than 75 lakh bales (170 kg each) in the current season to September as domestic demand has picked up. But some estimates are pegging them higher than 100 lakh bales against a record 120-plus lakh bales last season.

CCI, which had nearly 207 lakh bales of cotton stocks, could be left with 18 lakh bales by the end of the season, the CMD said, adding that most of the sales were meant for domestic consumption. Some trade experts expect mills’ consumption to top 300 lakh bales, though Southern India Mills Association (SIMA) Secretary-General K Selvaraju said the shutdown due to Covid pandemic could lower the offtake below CCPC projections.

In spot market, Cotton gained by 150 Rupees to end at 25530 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -9.66% to settled at 3770 while prices up 80 rupees, now Cotton is getting support at 25470 and below same could see a test of 25360 levels, and resistance is now likely to be seen at 25680, a move above could see prices testing 25780.

Trading Ideas:
* Cotton trading range for the day is 25360-25780.
* Cotton prices gained as the area of cotton cultivation in Marathwada has reduced during this kharif season.
* India’s cotton ending stocks could be lower than 75 lakh bales in the current season as domestic demand has picked up
* CCI said cotton exports would exceed 70 lakh bales and the current shipments were competitive globally.
* In spot market, Cotton gained  by 150 Rupees to end at 25530 Rupees.

Chana

Chana yesterday settled up by 0.06% at 4813 reovered from lows on short covering after pressure seen as the Govt imposed stock limits on all pulses except moong for wholesalers, retailers, millers and importers, to bring down the prices of these items, which have risen in retail markets since March. According to the order issued by the food ministry, valid until October 31, wholesalers can keep with them maximum 200 tonne of all pulses, including not more than 100 tonne in one variety. The stock limit for retailers has been fixed at 5 tonne. For millers, the limit is total production during last three months or 25% of annual installed capacity, whichever is higher. Importers are allowed to keep maximum 200 tonne of all pulses, including not more than 100 tonne in one variety (same as for wholesalers), for stocks held/imported before 15th May. However, this same stock limit will be applicable on importers after 45 days from date of customs clearance for stocks imported after May 15. Besides, in order to enhance domestic availability, ban on import of tur, urad and moong was lifted for the period between May 15 and October 31. The government also signed a 5-year agreement with Myanmar for annual import of 2.5 lakh tonne of urad and 1 lakh tonne of tur. In Delhi spot market, chana dropped by -8.35 Rupees to end at 4691.65 Rupees per 100 kgs.Technically market is under fresh buying as market has witnessed gain in open interest by 0.35% to settled at 124110 while prices up 3 rupees, now Chana is getting support at 4767 and below same could see a test of 4722 levels, and resistance is now likely to be seen at 4841, a move above could see prices testing 4870.

Trading Ideas:
* Chana trading range for the day is 4722-4870.
* Chana recovered from lows after pressure seen as the Govt imposed stock limits on all pulses except moong
* Wholesalers can keep with them maximum 200 tonne of all pulses, including not more than 100 tonne in one variety.
* Importers are allowed to keep maximum 200 tonne of all pulses, including not more than 100 tonne in one variety
* In Delhi spot market, chana dropped  by -8.35 Rupees to end at 4691.65 Rupees per 100 kgs.

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