Cotton trading range for the day is 33730-34490 - Kedia Advisory
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COTTON
Cotton yesterday settled up by 0.18% at 34160 as the rates of the natural fiber are rising this season due to a drastic fall in production. Cotton traders ascribed the phenomenon to a drastic drop in cotton yields coinciding with a negligible carry-forward stock of the previous year in India and an empty pipeline of the domestic cotton ginning and spinning industry. The cotton arrivals in APMCs are almost half as compared to normal years even as demand from the domestic ginning and spinning industry is high as its raw material pipeline was empty due to almost nil carry-forward stock of the previous year. A drastic reduction in the country’s cotton production can play spoilsport for the its export target of 60 lakh bales (each bale is 170 kg pressed ginned cotton). Industry insiders said that this year exports will be around 30-35 lakh bales as domestic prices and shortage is likely to play spoilsport throughout the season. As against the estimate of 340-345 lakh bales industry experts say that the production is in the range of 300-315 lakh bales during this season. Given the short supply and bullish prices, farmers are holding on to their crop with the markets reporting the arrival of just 125 lakh bales till date. In spot market, Cotton gained by 70 Rupees to end at 33600 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 0.93% to settled at 6697 while prices up 60 rupees, now Cotton is getting support at 33940 and below same could see a test of 33730 levels, and resistance is now likely to be seen at 34320, a move above could see prices testing 34490
Trading Idea for the day
Cotton trading range for the day is 33730-34490.
Cotton gains as the rates of the natural fiber are rising this season due to a drastic fall in production.
Production woes likely to hit country’s cotton export targets
Cotton price soars to Rs 10,000/quintal in Gujarat mandis
COCUDAKL
Cocudakl yesterday settled up by 3.6% at 3111 as support came after rains and hailstorm in few parts of Maharashtra. amid tight supplies owing to higher input costs with rising global demand. However, upside seen limited as the chances of re-emergence of the Covid through the Omicron variant is said to be having a global impact. The global cotton balance sheets for 2021/22 include higher production and consumption, and slightly lower ending stocks. The projected global consumption is up 700,000 bales. The world production forecast is 1.5 million bales higher as gains for Brazil, Australia, Pakistan, and the United States more than offset a 200,000- bale decline in Greece following unusually heavy October rainfall. World ending stocks are projected at 86.9 million bales, 200,000 bales lower than in October, and 2.4 million bales lower than in 2020/21. The broader-based view for cotton is therefore positive from a pricing perspective, which implies that cotton cake prices shall tend to remain in an upward trend in forthcoming weeks. Dairy prices rose at the global auction, surpassing their March peak to touch a fresh seven-year high, as tight milk supply underpins demand for New Zealand’s biggest export commodity. The Global Dairy Trade price index increased 1.4 per cent at the latest auction, to touch its highest level since March 2014. In Akola spot market, Cocudakl gained by 98.65 Rupees to end at 3100 Rupees per 100 kgs.Technically market is under short covering as market has witnessed drop in open interest by -1.96% to settled at 55490 while prices up 108 rupees, now Cocudakl is getting support at 3035 and below same could see a test of 2959 levels, and resistance is now likely to be seen at 3155, a move above could see prices testing 3199
Trading Idea for the day
Cocudakl trading range for the day is 2959-3199
Cocudakl prices gained as support came after rains and hailstorm in few parts of Maharashtra.
Support also seen amid tight supplies owing to higher input costs with rising global demand.
However, upside seen limited as the chances of re-emergence of the Covid through the Omicron variant is said to be having a global impact.
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