Cotton trading range for the day is 24700-25880 - Kedia Advisory
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Cotton
Cotton yesterday settled down by -1.72% at 25160 as the new cotton crop has begun arriving in northern markets, Karnataka and Telangala with prices of kapas (raw cotton) ruling at least 10 per cent higher than the minimum support price (MSP) levels fixed by the Centre for the new season starting October. Cotton acreage this year is lower by 5.75 per cent at 119.66 lakh hectares, as per Agriculture Ministry’s latest data. The overall crop condition is good as on date and, based on the feedback from the 10 growing States, the yield will be much higher this year and quality very good. The demand is slow as most of the spinning mills have covered their needs till December. If the moisture comes down, demand may improve over the next couple of weeks. The latest spell of heavy rains in Gujarat may appear to have saved the State from sinking into a drought, but for the current kharif crops such as cotton, it has pushed back the harvest period by at least 15 days and also weakened the prospects of kharif groundnut due to waterlogging. In September WASDE report, the USDA projected U.S. production at 18.5 million bales, 1.2 million bales higher than the previous month. In spot market, Cotton dropped by -130 Rupees to end at 26490 Rupees.Technically market is under fresh selling as market has witnessed gain in open interest by 7.76% to settled at 1945 while prices down -440 rupees, now Cotton is getting support at 24930 and below same could see a test of 24700 levels, and resistance is now likely to be seen at 25520, a move above could see prices testing 25880
Trading Idea for the day
Cotton trading range for the day is 24700-25880.
Cotton prices dropped as the new cotton crop has begun arriving in northern markets, Karnataka and Telangala
Cotton acreage this year is lower by 5.75 per cent at 119.66 lakh hectares, as per Agriculture Ministry’s latest data.
The overall crop condition is good as on date and, based on the feedback from the 10 growing States
Cocudakl
Cocudakl yesterday settled down by -0.82% at 2420 as crop seems to be in good condition after Gujarat received very good rainfall from last few days. Cotton production will still be high because of good rains and may touch 350-360 lakh bales despite the area under coverage has gone down by 6-8%, from 133 lakh hectares last year to 125 lakh hectares in the current season. The U.S. Department of Agriculture forecast lower production and also cut ending stocks estimates for the 2021/22 marketing year in a monthly report. In its WASDE report, the USDA projected lower U.S. production, exports and ending stocks compared with July, as well as lower world 2021/22 ending stocks. CAI in its July estimate of the cotton crop for the season 2020-21 beginning October 1, 2020, has reduced the crop estimate by 1.50 lakh bales to 354.50 lakh bales from its previous estimate of 356 lakh bales. The CAI has maintained its cotton crop estimate for the Northern Zone at the same level as in its previous month’s estimate i.e. at 65.50 lakh bales. In Akola spot market, Cocudakl dropped by -18.75 Rupees to end at 2800 Rupees per 100 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 5.23% to settled at 24360 while prices down -20 rupees, now Cocudakl is getting support at 2394 and below same could see a test of 2368 levels, and resistance is now likely to be seen at 2453, a move above could see prices testing 2486.
Trading Idea for the day
Cocudakl trading range for the day is 2368-2486
Cocudakl prices dropped as crop seems to be in good condition after Gujarat received very good rainfall from last few days
However downside were limited amid tight supply situation in cottonseed is expected to continue in the coming months considering the stronger demand.
The cotton crop estimate for the Central Zone has been reduced by 0.50 lakh bales to 193.50 lakh bales
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