IGI Logo

Trading Ideas:            

* Gold trading range for the day is 48718-49554.

* Gold dropped as a firmer dollar countered a slip in U.S. Treasury yields

* U.S. trade deficit retreated from a record high in April amid a decline in imports, suggesting domestic demand was starting to revert back to services from goods.

* Investors are looking forward to U.S. consumer price index data due Thursday.

Silver           

Silver yesterday settled down by -0.82% at 71231 as the dollar strengthened ahead of Thursday's all-important inflation report. U.S. Treasury Secretary Janet Yellen said President Joe Biden’s $4 trillion spending plan would be good for the United States even if it contributes to rising inflation and results in higher interest rates. U.S. job openings surged by nearly one million to a new record high in April, while more people voluntarily left their employment, strengthening the view that a recent moderation in job growth was due to supply constraints. Job openings, a measure of labor demand, increased by 998,000 to 9.3 million on the last day of April, the highest level since the series began in December 2000, the Labor Department said in its monthly Job Openings and Labor Turnover Survey. The euro zone economy contracted by much less than expected in the first quarter of the year, revised data from the EU's statistics office showed, with a buildup of inventories and investment offset by reduced consumer spending. Eurostat said gross domestic product in the 19 countries sharing the euro contracted 0.3% quarter-on-quarter for a 1.3% year-on-year decline. Investors await U.S. inflation data due later this week for more clues on the Fed monetary policy outlook. Technically market is under fresh selling as market has witnessed gain in open interest by 0.47% to settled at 11241 while prices down -586 rupees, now Silver is getting support at 70875 and below same could see a test of 70518 levels, and resistance is now likely to be seen at 71694, a move above could see prices testing 72156.          

Trading Ideas:            

* Silver trading range for the day is 70518-72156.

* Silver prices eased as the dollar strengthened ahead of Thursday's all-important inflation report.

* U.S. Treasury Secretary Janet Yellen said President Joe Biden’s $4 trillion spending plan would be good for the United States

* The euro zone economy contracted by much less than expected in the first quarter of the year.

Crude oil           

Crude oil yesterday settled up by 0.81% at 5089 in the glow of improving demand sentiment and OPEC-led supply cuts. On the supply side, OPEC+ agreed to keep to their plan to gradually ease supply curbs through July, signalling the ongoing strengthening of market fundamentals. OPEC and its allies expect oil inventories to fall further in the coming months, OPEC's secretary general said, suggesting efforts by the producers to support the market are succeeding. Oil stocks in developed world nations fell by 6.9 million barrels in April, Mohammad Barkindo said in a virtual appearance at the Nigeria International Petroleum Summit, 160 million barrels lower than the same time one year ago, making the figure public for the first time. "We expect to see further drawdowns in the months ahead," he said. The Organization of the Petroleum Exporting Countries and allies – known as OPEC+ – decided in April to return 2.1 million barrels per day (bpd) to the market from May through July. U.S. crude oil exports reached 3.24 million barrels per day in April compared with 2.61 million bpd the March, foreign trade data from the U.S. Census Bureau showed. Exports to Netherlands were 425,000 bpd. Exports to India were 370,000 bpd. Exports to Canada were 354,000 bpd. Technically market is under fresh buying as market has witnessed gain in open interest by 16.52% to settled at 10870 while prices up 41 rupees, now Crude oil is getting support at 5021 and below same could see a test of 4953 levels, and resistance is now likely to be seen at 5128, a move above could see prices testing 5167.  

Trading Ideas:            

* Crude oil trading range for the day is 4953-5167.

* Crude oil prices gained in the glow of improving demand sentiment and OPEC-led supply cuts.

* OPEC and its allies expect oil inventories to fall further in the coming months, OPEC's secretary general said

* OPEC+ decided in April to return 2.1 million barrels per day (bpd) to the market from May through July.

Nat.Gas           

Nat.Gas yesterday settled up by 3.01% at 229.3 on forecasts for warmer weather over the next two weeks than previously expected, which should cause power generators to burn more gas to keep air conditioners humming. Traders noted that the price increase coincided with record pipeline exports to Mexico despite lower liquefied natural gas (LNG) exports due to short-term maintenance issues. Data provider Refinitiv said gas output in the Lower 48 U.S. states had averaged 91.7 billion cubic feet per day (bcfd) so far in June, up from 91.0 bcfd in May but still well below the monthly record high of 95.4 bcfd in November 2019. With warmer weather on the horizon, Refinitiv projected average gas demand, including exports, would rise from 87.8 bcfd this week to 89.7 bcfd next week. The forecast for next week was higher than Refinitiv predicted on Monday on expectations for rising air conditioning use. The amount of gas flowing to U.S. LNG export plants has slid to an average of 9.9 bcfd so far in June, down from 10.8 bcfd in May and the all-time high of 11.5 bcfd in April. U.S. pipeline exports to Mexico, meanwhile, have averaged 6.5 bcfd so far in June, putting them on track to top May's all-time high of 6.2 bcfd. Technically market is under fresh buying as market has witnessed gain in open interest by 61.28% to settled at 22696 while prices up 6.7 rupees, now Natural gas is getting support at 224.8 and below same could see a test of 220.4 levels, and resistance is now likely to be seen at 233.4, a move above could see prices testing 237.6.        

Trading Ideas:            

* Natural gas trading range for the day is 220.4-237.6.

* Natural gas rose on forecasts for warmer weather over the next two weeks than previously expected

* The price increase coincided with record pipeline exports to Mexico despite lower LNG exports due to short-term maintenance issues.

* U.S. speculators boosted their net long futures and options positions last week for the fourth time in five weeks.

Copper           

Copper yesterday settled up by 0.74% at 746.1 as the world economy is expected to grow by 5.6 percent this year, up from a 4.1 percent expansion projected in January and marking the strongest recovery from a recession in 80 years, the World Bank's Global Economic Prospects report showed. The upward revision for 2021 reflected additional fiscal support in a few large economies, in particular Joe Biden's $1.9 trillion stimulus package. However, the development lender warned the recovery should be held back by highly unequal access to COVID-19 vaccines. Meanwhile, the Yangshan copper premium was last at $28 a tonne, hovering around its lowest since February 2016 and down 75% compared to May 2020, indicating weakening demand for imported metal into China. China’s copper imports fell 8% in May from the previous month, official data showed, as record-high prices further eroded buying interest in the country. Japan's economy shrank at a slower-than-initially reported pace in the first quarter, on smaller cuts to plant and equipment spending, but the coronavirus pandemic still dealt a huge blow to overall demand. Separate data showed growth in bank lending slowed sharply in May, while real wages posted the biggest monthly jump in more than a decade in April, in signs that the world's third-largest economy was gradually overcoming last year's pandemic hit. Technically market is under short covering as market has witnessed drop in open interest by -7.1% to settled at 4424 while prices up 5.5 rupees, now Copper is getting support at 736.6 and below same could see a test of 727.1 levels, and resistance is now likely to be seen at 752, a move above could see prices testing 757.9.   

Trading Ideas:            

*  Copper trading range for the day is 727.1-757.9.

*  Copper gained as the world economy is expected to grow by 5.6 percent this year, up from a 4.1 percent expansion projected in January 

*  Janet Yellen said President Joe Biden’s $4 trillion spending plan would be good even if it contributes to rising inflation and results in higher interest rates.

* The Yangshan copper premium was last at $28 a tonne, hovering around its lowest since February 2016 and down 75% compared to May 2020

Zinc           

Zinc yesterday settled up by 0.19% at 237.75 as China's refined zinc output stood at 494,600 mt in May, down 2.06% or 10,400 mt on the month and up 4.32% on the year. Output stood at 2.51 million mt in January-May, up 4.51% year on year. Smelters in the survey sample produced 79,200 mt of zinc alloy in May, up 2.32% from the previous month. Output of primary zinc stood at 392,625 mt in May, and secondary zinc output came in at 47,750 mt. In addition, SMM revised China's refined zinc output in April to 505,100 mt, a correction range of 5,000 mt. The Federal Reserve's overnight reverse repurchase usage reached a record high, exceeding $486 billion. Deutsche Bank said that the Fed has a "low probability" that it will adjust its management interest rate in June. The European Central Bank's bond purchase in April and May far exceeded that of the four major countries, but it is still difficult to curb the rise in yield. The influence of Yellen's soothing speech was fading, and the dollar weakened again. U.S. job openings surged by nearly one million to a new record high in April, while more people voluntarily left their employment, strengthening the view that a recent moderation in job growth was due to supply constraints. Technically market is under fresh buying as market has witnessed gain in open interest by 0.23% to settled at 2177 while prices up 0.45 rupees, now Zinc is getting support at 235.7 and below same could see a test of 233.7 levels, and resistance is now likely to be seen at 238.9, a move above could see prices testing 240.1.       

Trading Ideas:            

*  Zinc trading range for the day is 233.7-240.1.

*  Zinc recovered from lows as China's refined zinc output fell 2.06% on the month to 494,600 mt in May

*  The Federal Reserve's overnight reverse repurchase usage reached a record high, exceeding $486 billion.

*  U.S. job openings surged by nearly one million to a new record high in April

Nickel           

Nickel yesterday settled up by 0.43% at 1314.3 on optimism about economic recovery and data for the euro zone economy was upbeat for the first quarter of the year, contracting less than expected. Indonesia aims for three nickel smelters to be completed and operational this year, an official at the country's energy and natural resources ministry said, without specifying the capacity of the smelters. Two of the smelters, operated by PT Smelter Nickel Indonesia and PT Cahaya Modern Metal Industri, were now completed and had gone through production trials, Ridwan Djamaluddin, director general of mineral and coal at the energy ministry, said. Production trials at PT Smelter Nickel Indonesia's smelter, however, had been suspended as it was waiting for funds to continue operations, the statement said. Domestic NPI output increased by 5.32% month on month to 35,700 mt (Ni content) in May 2021. Output of high-grade NPI rose 10% to 29,400 mt in metal content, while that of low-grade NPI dropped 12.1% to 6,300 mt in metal content. The increase in the production of high-grade NPI in May was due to the price increase amid tighter supply in April, and the prices of nickel ore declined amid the increase in imports. NPI plants increased production for wider profit margins. Technically market is under short covering as market has witnessed drop in open interest by -5.93% to settled at 1983 while prices up 5.6 rupees, now Nickel is getting support at 1300.2 and below same could see a test of 1286.2 levels, and resistance is now likely to be seen at 1323.5, a move above could see prices testing 1332.8.           

Trading Ideas:            

*  Nickel trading range for the day is 1286.2-1332.8.

*  Nickel prices recovered on optimism about economic recovery and data for the euro zone economy was upbeat for the first quarter of the year

* Indonesia aims for three nickel smelters to be completed and operational this year, a government official said.

* China's NPI output increased by 5.32% MoM to 35,700 mt

Aluminium           

Aluminium yesterday settled up by 0.92% at 191.8 as LME cash aluminium was at a $5.24-a-tonne discount to the three-month contract the smallest discount since May 7, indicating nearby supplies are tightening. Tsingshan Holding Group is set to ramp up aluminium production in Indonesia in 2023, as the Chinese stainless steel and nickel group diversifies operations in the country. Tsingshan made a name for itself in the global nickel market by investing heavily in Indonesia, which banned nickel ore exports from 2020, and is involved in projects there to make battery chemicals and nickel pig iron. Aluminium stocks at three major Japanese ports rose 1.3% to 273,600 tonnes at the end of April, from 270,200 tonnes at the end of March. The U.S. trade deficit retreated from a record high in April amid a decline in imports, suggesting domestic demand was starting to revert back to services from goods. With at least half of the American population fully vaccinated against COVID-19, authorities across the country are lifting virus-related restrictions on businesses, boosting demand for services like travel. Demand shifted towards goods, with Americans cooped up at home, at the height of the pandemic. The trade deficit dropped 8.2% to $68.9 billion in April, the Commerce Department said. Technically market is under short covering as market has witnessed drop in open interest by -7.75% to settled at 1833 while prices up 1.75 rupees, now Aluminium is getting support at 190.2 and below same could see a test of 188.5 levels, and resistance is now likely to be seen at 193, a move above could see prices testing 194.1.         

Trading Ideas:            

*  Aluminium trading range for the day is 188.5-194.1.

*  Aluminium gained as LME cash aluminium was at a $5.24-a-tonne discount to the three-month contract the smallest discount since May 7

* Tsingshan Holding Group is set to ramp up aluminium production in Indonesia in 2023

*  Aluminium stocks at three major Japanese ports rose 1.3% to 273,600 tonnes at the end of April, from 270,200 tonnes at the end of March.

 Mentha oil          

Mentha oil yesterday settled up by 0.35% at 921.9 due to rain harvesting of menthe crop will be affected and also production get affected. 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. However upside seen limited as fresh season arrival started while the lock-down extension is impacting sentiments. As of now, daily arrival of fresh oil is relatively small (10-15 drums across Uttar Pradesh). Daily arrivals should gradually pick up to 400-500 drums in next 7-10 days. Overall post-lock-down demand will be likely to improve as demand from the health industry will likely continue also as per CIMAP (Central Institute of Medicinal and Aromatic Plants) Herbal products may boost immunity to avoid infection and demand for same has improved significantly since last year. Mentha exhibits important biological activities. For that reason, it has been used through the years as a remedy for respiratory diseases like bronchitis, sinusitis, tuberculosis, and the common cold. Due to favourable wheather condition,the production of mentha in the states has improved and is at much better terms compare to last year. In Sambhal spot market, Mentha oil gained by 4.3 Rupees to end at 1020.8 Rupees per 360 kgs.Technically market is under short covering as market has witnessed drop in open interest by -6.06% to settled at 31 while prices up 3.2 rupees, now Mentha oil is getting support at 917 and below same could see a test of 912 levels, and resistance is now likely to be seen at 927, a move above could see prices testing 932.  

Trading Ideas:            

* Mentha oil trading range for the day is 912-932.

* In Sambhal spot market, Mentha oil gained  by 4.3 Rupees to end at 1020.8 Rupees per 360 kgs.

* Mentha gained due to rain harvesting of menthe crop will be affected and also production get affected.

* However upside seen limited as fresh season arrival started while the lock-down extension is impacting sentiments.

* Daily arrivals should gradually pick up to 400-500 drums in next 7-10 days.

Soyabean           

Soyabean yesterday settled down by -0.54% at 6939 as Indian farmers are likely to expand their soybean planting area by more than a tenth in 2021 as record high prices for the oilseed could prompt some to switch from cultivating competing commodities such as cotton and pulses, industry officials said. China’s soybean imports in May rose from the previous month, customs data showed, as more cargoes from top supplier Brazil cleared customs. China, the world’s top importer of soybeans, brought in 9.61 million tonnes of the oilseed in May, up 29% from 7.45 million tonnes in April, when some Brazilian shipments were delayed, data from the General Administration of Customs showed. Indian farmers are likely to expand their soybean planting area by more than a tenth in 2021 as record high prices for the oilseed could prompt some to switch from cultivating competing commodities such as cotton and pulses, industry officials said. Increased production of India's main summer-sown oilseed could help the world's biggest vegetable oil importer trim costly purchases of palm oil, soyoil and sunflower oil from Indonesia, Malaysia, Argentina and Ukraine. It could also boost Indian exports of animal feed ingredient soymeal to places such as Bangladesh, Japan, Vietnam and Iran, industry officials said. At the Indore spot market in top producer MP, soybean gained 5 Rupees to 7482 Rupees per 100 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 3.83% to settled at 30475 while prices down -38 rupees, now Soyabean is getting support at 6875 and below same could see a test of 6812 levels, and resistance is now likely to be seen at 6998, a move above could see prices testing 7058.    

Trading Ideas:            

* Soyabean trading range for the day is 6812-7058.

* Soyabean prices dropped as India's soybean planting could rise by over 10% on record prices

* China Jan-May soybean imports up 12.8% at 38.23 million tonnes

* Indian farmers are likely to expand their soybean planting area by more than a tenth in 2021

*  At the Indore spot market in top producer MP, soybean gained  5 Rupees to 7482 Rupees per 100 kgs.

Ref.Soyaoil           

Ref.Soyaoil yesterday settled down by -0.44% at 1397 on profit booking tracking weakness in soyabean prices after seen supported on concerns about tight global supplies of edible oils. India is considering reducing import taxes on edible oils after cooking oil prices hit record highs last month, to reduce food costs in the world's biggest vegetable oil importer. While no decision has been made, the tax reduction could lower local prices and boost consumption, giving support to Malaysian palm oil, along with soy and sunflower oil prices, and dampening prices of local oilseeds such as rapeseed, soybean and groundnut. Higher soybean output could limit edible oil imports. Indian farmers are likely to expand their soybean planting area by more than a tenth in 2021 as record high prices for the oilseed could prompt some to switch from cultivating competing commodities such as cotton and pulses, industry officials said. Increased production of India's main summer-sown oilseed could help the world's biggest vegetable oil importer trim costly purchases of palm oil, soyoil and sunflower oil from Indonesia, Malaysia, Argentina and Ukraine. Edible Oil industry cautioned the government against resorting to any knee-jerk reaction of lowering import duties to cool down domestic prices, saying it could have a 'very negative’ impact on oilseed farmers, kharif planting for which will start in the coming few weeks. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1424.5 Rupees per 10 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 27.06% to settled at 23645 while prices down -6.2 rupees, now Ref.Soya oil is getting support at 1383 and below same could see a test of 1370 levels, and resistance is now likely to be seen at 1404, a move above could see prices testing 1412.  

Trading Ideas:            

* Ref.Soya oil trading range for the day is 1370-1412.

* Ref soyoil dropped on profit booking tracking weakness in soyabean prices after seen supported on concerns about tight global supplies of edible oils. 

* India is considering reducing import taxes on edible oils after cooking oil prices hit record highs last month

* Indian farmers are likely to expand their soybean planting area by more than a tenth in 2021

* At the Indore spot market in Madhya Pradesh, soyoil was steady at 1424.5 Rupees per 10 kgs.

Crude palm Oil           

Crude palm Oil yesterday settled down by -1.37% at 1135.6 as expectations of rising May stockpiles and output, and worries of a levy cut in Indonesia dented prices. Pressure also seen as surveys pegged Malaysia’s May stockpile to climb to an eight-month peak. Malaysia's palm oil stockpiles at the end of May likely jumped 6.3% on-month to their highest in eight months, as production rose amid sluggish exports. Inventories at the world's second-largest producer are seen at 1.64 million tonnes, their highest since last September. Production is pegged to rise 3.4% from April to 1.58 million tonnes, its highest in seven months, as plantations enter the seasonal higher production months. Exports in May are expected to climb 0.9% month-on-month to 1.35 million tonnes, with cargo surveyor data showing slightly smaller shipments to the world's biggest palm oil buyer, India. India is considering reducing import taxes on edible oils after cooking oil prices last month hit record highs, which may support palm oil prices. The market will be anticipating lower domestic consumption and higher supply in June. A labour shortage in Malaysia's plantations that has curbed output throughout the coronavirus pandemic is expected to prolong as a resurgence of COVID-19 cases forced the nation into a two-week lockdown. The palm oil supply chain is allowed to operate during the lockdown, but local consumption will likely decline due to the closure of hotels, restaurants and catering services. In spot market, Crude palm oil dropped by -11 Rupees to end at 1153.8 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -6.15% to settled at 4840 while prices down -15.8 rupees, now CPO is getting support at 1117 and below same could see a test of 1098.5 levels, and resistance is now likely to be seen at 1149.2, a move above could see prices testing 1162.9.  

Trading Ideas:            

* CPO trading range for the day is 1098.5-1162.9.

* Crude palm oil dropped as expectations of rising May stockpiles and output, and worries of a levy cut in Indonesia dented prices.

* May stocks seen 6.3% higher at 1.64 mln T

* Output seen up 3.4% at 1.58 mln T

* In spot market, Crude palm oil dropped  by -11 Rupees to end at 1153.8 Rupees.

Mustard Seed           

Mustard Seed yesterday settled down by -0.94% at 7078 as 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. Prices rallied in recent session lifted by higher soy prices and concerns about dry Canadian planting conditions. Support also seen as crushing as increased due to rise in mustard oil demand. Stock of mustard with farmers is estimated to be 62.50 lakh tonnes and processors and stockists have a stock of six lakh tonnes of mustard. India mustard output this year is projected at 104.27 lakh tonnes. However, the Central Organisation for Oil Industry and Trade (COOIT) and the Mustard Oil Producers' Association (MOPA) have estimated the production at 89.50 lakh tonnes. In Alwar spot market in Rajasthan the prices dropped -125 Rupees to end at 7200 Rupees per 100 kg.Technically market is under fresh selling as market has witnessed gain in open interest by 5.55% to settled at 60050 while prices down -67 rupees, now Rmseed is getting support at 7044 and below same could see a test of 7010 levels, and resistance is now likely to be seen at 7121, a move above could see prices testing 7164.   

Trading Ideas:            

* Rmseed trading range for the day is 7010-7164.

* Mustard seed dropped as U.S. rapeseed production is forecast to reach a record 1.8 million tons on record area and trend yield. 

* Canada rapeseed production is projected at 20.5 million tons, up 1.5 million on greater area.

* The arrival of mustard in the mandis has decreased at all places in the country.

* In Alwar spot market in Rajasthan the prices dropped -125 Rupees to end at 7200 Rupees per 100 kg.

Turmeric           

Turmeric yesterday settled up by 0.25% at 7872 on following export demand from Europe, Gulf countries and Bangladesh. However upside seen limited as 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. According to Spices Board data, turmeric exports during the April-December period of the last fiscal increased 34 per cent to 1.39 lakh tonnes valued at ₹1,251 crore compared with 1.03 lakh tonnes valued at ₹1,047 crore. In Nizamabad, a major spot market in AP, the price ended at 7556.5 Rupees dropped -21.9 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 10.37% to settled at 7395 while prices up 20 rupees, now Turmeric is getting support at 7760 and below same could see a test of 7648 levels, and resistance is now likely to be seen at 8062, a move above could see prices testing 8252.    

Trading Ideas:            

* Turmeric trading range for the day is 7648-8252.

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

* However upside seen limited as the curbs and lockdowns announced to control the second wave of Covid-19 pandemic affected trading.

* At least 50 per cent of the crop cultivated in the Maharashtra growing regions are estimated to have arrived at the terminal agricultural markets.

* In Nizamabad, a major spot market in AP, the price ended at 7556.5 Rupees dropped -21.9 Rupees.

Jeera    

Jeera yesterday settled down by -0.32% at 13915 as lockdown restrictions increased against rising Covid cases, slowing spot trade interest weakened market sentiments. The wholesale offers for the NCDEX grade Jeera are currently offered around Rs.14000/qtl in Unjha and in Jodhpur, the mandi offers average near Rs.13900/qtl. Over a month, the wholesale prices in Unjha and Jodhpur have gone down by Rs.400/qtl and Rs.700/qtl respectively. 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 30.25 Rupees to end at 13925 Rupees per 100 kg.Technically market is under fresh selling as market has witnessed gain in open interest by 20.36% to settled at 4203 while prices down -45 rupees, now Jeera is getting support at 13860 and below same could see a test of 13810 levels, and resistance is now likely to be seen at 14000, a move above could see prices testing 14090.

Trading Ideas:            

* Jeera trading range for the day is 13810-14090.

* Jeera prices dropped as lockdown restrictions increased against rising Covid cases.

* 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.

* In Unjha, a key spot market in Gujarat, jeera edged up by 30.25 Rupees to end at 13925 Rupees per 100 kg.

Cotton           

Cotton yesterday settled up by 0.25% at 24440 amid prospects of higher exports and falling supply in physical markets. Cotton sowing area grows despite of delays. Despite sowing of cotton stretching beyond the ideal sowing time in Punjab, it is close to reaching the target for 2021-22. The state agriculture department had the target of sowing cotton on 3.25 lakh hectares the crop had been sown over 3.01 lakh hectares. New figures show global cotton stock levels are set to increase to 22m tonnes by the end of 2020/21 as the stocks-to-use ratio declines. According to the latest update from the International Cotton Advisory Committee (ICAC), China’s stocks, however, are expected to decline as the rest of the world’s expands slightly. Cotton consumption is expected to increase by 2% to 25.3m tonnes as the global economy continues to recover. Decreases in Brazil, India and the US have caused a reduction in the 2020/21 global production estimate but cotton production — along with consumption and trade — are all expected to increase in 2021/22: Production is expected to increase by 5% to 25.5m tonnes, with increases in planted areas in the US and West Africa. In spot market, Cotton gained by 100 Rupees to end at 24230 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -6.79% to settled at 5391 while prices up 60 rupees, now Cotton is getting support at 24270 and below same could see a test of 24110 levels, and resistance is now likely to be seen at 24540, a move above could see prices testing 24650.       

Trading Ideas:            

* Cotton trading range for the day is 24110-24650.

* Cotton prices gained amid prospects of higher exports and falling supply in physical markets

* Cotton stock levels are set to increase to 22m tonnes by the end of 2020/21

* According to the latest update from the ICAC, China’s stocks, however, are expected to decline as the rest of the world’s expands slightly.

* In spot market, Cotton gained  by 100 Rupees to end at 24230 Rupees.

Chana           

Chana yesterday settled down by -1.08% at 5227 on profit booking after prices seen supported as there is a strong possibility of shortage in pulses production, especially due to uncertainty over sowing this crop year due to the pandemic. The country is most likely to face scarcity of pulses this year including masoor, chana and other pulses. There could be a shortage of around 10 lakh tonne in the production of tur this year. As the apex body for the trade, IPGA is bringing it to the notice of the government well in advance to augment the supply side. However, as per trade estimates, the production for tur has been around 2.90 million tonne, urad approximately 2.06 million tonne, moong around 2 million tonne, Chana around 9 million tonne and masoor around 0.95 million tonne. India’s supply of Kabuli chickpea is expected to plunge 32 percent to 396,000 tonnes due to low carryout and very poor production prospects for all of India’s rabi (winter) season crops. Exports will fall to an estimated 50,000 tonnes, down from 115,000 tonnes each of the previous two years. The situation is so dire that India is expected to import 50,000 tonnes from Canada, Argentina and Turkey. In Delhi spot market, chana dropped by -48.75 Rupees to end at 5157.5 Rupees per 100 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 9.93% to settled at 108750 while prices down -57 rupees, now Chana is getting support at 5198 and below same could see a test of 5168 levels, and resistance is now likely to be seen at 5275, a move above could see prices testing 5322.           

Trading Ideas:            

* Chana trading range for the day is 5168-5322.

* Chana dropped on profit booking after prices seen supported as shortage of pulses likely as production expected to decline

* The country is most likely to face scarcity of pulses this year including masoor, chana and other pulses.

* India’s supply of Kabuli chickpea is expected to plunge 32 percent to 396,000 tonnes due to low carryout and very poor production prospects

* In Delhi spot market, chana dropped  by -48.75 Rupees to end at 5157.5 Rupees per 100 kgs.

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer