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Gold

Gold yesterday settled down by -0.19% at 50735 as Governor Christopher Waller said he would support another increase of a similar scale at the central bank’s July meeting. Meanwhile, Cleveland Fed Bank President Loretta Mester said that the risk of a US recession is increasing, and that it will take several years to return to the central bank’s 2% inflation goal. Concerns about the potential economic costs of an aggressive tightening kept markets on edge, providing some support to gold prices. However, downside seen limited amid global economic worries countered concerns around aggressive monetary tightening by the U.S. Federal Reserve, with focus being on several central bankers' views this week. Discounts on physical gold in India narrowed, helped by some fresh buying from jewellers, while COVID-19 restrictions kept activity tepid in top consumer China. Indian dealers offered discounts of around $6 an ounce over official domestic prices compared with last week's $10 discounts. In China, gold changed hands at anywhere between discounts of $5 and $0.5 to premiums of $2 to $5 an ounce over global benchmark spot prices. In Hong Kong, gold was sold at anywhere between a discount of $1.8 an ounce to a premium of$1.50, while in Singapore, dealers charged premiums of $1.30-$1.70. Technically market is under long liquidation as market has witnessed drop in open interest by -0.76% to settled at 12585 while prices down -99 rupees, now Gold is getting support at 50637 and below same could see a test of 50539 levels, and resistance is now likely to be seen at 50909, a move above could see prices testing 51083.

Trading Ideas:
* Gold trading range for the day is 50539-51083.
* Gold remained under pressure as Governor Christopher Waller said he would support another increase of a similar scale at the central bank’s July meeting.
* However, downside seen limited amid global economic worries countered concerns around aggressive monetary tightening by the U.S. Federal Reserve
* Fed’s Mester said that the risk of a US recession is increasing, and that it will take several years to return to the central bank’s 2% inflation goal.

Silver

Silver yesterday settled down by -0.32% at 60744 as the Fed and other major central banks around the world raise interest rates to tackle inflation. The Federal Reserve hiked the Fed funds rate by 75bps and Chair Powell signaled a similar move is on the table at the next meeting, while the Bank of England raised rates for the 5th time and the Swiss National Bank raised borrowing costs for the first time since 2007. The ECB is expected to increase interest rates into positive territory in in Q3, starting with a 25bps hike in July. At the same time, investors worry about global growth amid the war in Europe, persistent supply chain issues, and the spread of Covid-19 in China. Federal Reserve Governor Christopher Waller said that he would back another rate hike of 75 basis point at the meeting in July. Cleveland Fed President Loretta Mester said that it will take a couple of years for inflation to move down to the central bank's 2 percent target. Market participants also await a congressional appearance by U.S. Federal Reserve Chair Jay Powell this week that could highlight the U.S. central bank's resolve to guide inflation back to the Fed's 2 percent target. Technically market is under fresh selling as market has witnessed gain in open interest by 1.7% to settled at 11570 while prices down -193 rupees, now Silver is getting support at 60556 and below same could see a test of 60368 levels, and resistance is now likely to be seen at 61046, a move above could see prices testing 61348.

Trading Ideas:
* Silver trading range for the day is 60368-61348.
* Silver dropped as the Fed and other major central banks around the world raise interest rates to tackle inflation.
* Investors worry about global growth amid the war in Europe, persistent supply chain issues, and the spread of Covid-19 in China.
* Federal Reserve Governor Christopher Waller said that he would back another rate hike of 75 basis point at the meeting in July.

Crude oil

Crude oil yesterday settled up by 1.56% at 8504 as the focus returned to tight supply of crude and fuel products versus concerns about a recession hitting demand down the track. Libyan oil total production is at about 700,000 barrels per day (bpd), the Libyan oil minister Mohamed Oun told. Libya’s oil output was at 100,000-150,000 bpd, a spokesman for the oil ministry said last week. Iraq seeks to raise its crude oil production to 8 million barrels per day (bpd) by the end of 2027 to fulfil its commitment to export quota within the Organisation of the Petroleum Exporting Countries (OPEC), Iraqi Oil Minister Ihsan Abdul-Jabbar Ismail said. “Iraq is working to increase its capabilities to raise its oil production capacity, and we have large projects to increase production, and we are committed to reaching the peak production of 8 million bpd by the end of 2027," Ismail told official Iraqi News Agency. China's Russian crude oil imports in May hit a record for a single month at 8.42 million tonnes (about 1.98 million barrels per day), up 55% from the same month of 2021, according to Chinese customs data. Customs data released also showed China imported 260,000 tonnes of Iranian crude oil last month, its third shipment of Iran oil since last December. Technically market is under short covering as market has witnessed drop in open interest by -10.29% to settled at 4211 while prices up 131 rupees, now Crude oil is getting support at 8396 and below same could see a test of 8289 levels, and resistance is now likely to be seen at 8569, a move above could see prices testing 8635.

Trading Ideas:
* Crude oil trading range for the day is 8289-8635.
* Crude oil gained as the focus returned to tight supply of crude and fuel products versus concerns about a recession hitting demand down the track.
* Libya oil output rises to about 700,000 bpd, minister says
* Iraq seeks to raise oil production to 8 mn bpd by 2027

Natural Gas
Nat.Gas yesterday settled down by -3.87% at 522.1 on forecasts for lower demand and expectations the extended shutdown of the Freeport liquefied natural gas (LNG) export plant in Texas would allow utilities to quickly rebuild low U.S. gas stockpiles. That price decline came despite record power demand in Texas, forecasts for much higher U.S. gas demand in two weeks as the weather turns hotter, and small declines in U.S. gas output in recent days. Data provider Refinitiv said average gas output in the U.S. Lower 48 states slid to 94.8 bcfd so far in June from 95.2 bcfd in May. That compares with a monthly record of 96.1 bcfd in December 2021. With hotter weather coming, Refinitiv projected average U.S. gas demand, including exports, would rise from 92.5 bcfd this week to 93.5 bcfd next week and 98.4 bcfd in two weeks. The forecasts for this week and next week were lower than Refinitiv's outlook on Thursday. Power demand in Texas hit a new all-time high on Thursday and will likely break that record again on Friday and Monday as homes and businesses keep their air conditioners cranked up to escape a lingering heat wave. Technically market is under fresh selling as market has witnessed gain in open interest by 9.86% to settled at 4724 while prices down -21 rupees, now Natural gas is getting support at 513.6 and below same could see a test of 505.2 levels, and resistance is now likely to be seen at 534.4, a move above could see prices testing 546.8.

Trading Ideas:
* Natural gas trading range for the day is 505.2-546.8.
* Natural gas slid on forecasts for lower demand and expectations the shutdown of Freeport LNG export plant would allow utilities to quickly rebuild.
* That price decline came despite record power demand in Texas, forecasts for much higher U.S. gas demand in two weeks as the weather turns hotter
* Average gas output in the U.S. Lower 48 states slid to 94.8 bcfd so far in June from 95.2 bcfd in May.

Copper

Copper yesterday settled down by -0.55% at 737.1 amid mounting fears that a global economic slowdown triggered by an aggressive tightening from major central banks and persistent coronavirus outbreaks in China would dampen demand. China stood pat on its benchmark lending rates for corporate and household loans, as expected, with global central banks' rate increases making it tough for Beijing to stimulate a weak domestic economy by lowering rates. Meanwhile, workers at the world's largest copper producer Codelco in Chile said they would start preparations for a national strike after the firm announced the closure of the troubled Ventanas smelter. Workers at Chilean state-owned miner Codelco, the world's largest copper producer, said they will start preparations for a national strike after the firm announced the closure of the troubled Ventanas smelter. Unions had threatened to strike for the past week if the Codelco board did not invest to upgrade the facility after an environmental incident sickened dozens of people. The Federation of Copper Workers (FTC), which groups Codelco's unions, said it regretted that the firm had "assumed exclusive responsibility for the environmental episodes in the Puchuncaví and Quintero area" in an industrial coastal region. Technically market is under long liquidation as market has witnessed drop in open interest by -5.97% to settled at 3605 while prices down -4.05 rupees, now Copper is getting support at 731.9 and below same could see a test of 726.6 levels, and resistance is now likely to be seen at 741.7, a move above could see prices testing 746.2.

Trading Ideas:
* Copper trading range for the day is 726.6-746.2.
* Copper dropped amid mounting fears that a global economic slowdown and persistent coronavirus outbreaks in China would dampen demand.
* Kazakhstan's January-May refined copper output rose 1.3% year on year
* Codelco unions ready strike after troubled Chile smelter shuttered

Zinc

Zinc yesterday settled up by 0.31% at 312.3 as the market players were again deeply worried about the economic recession after the US Fed released "the most hawkish inflation-fighting language to date", saying that the commitment to restoring price stability is "unconditional". On the macro front, last week, many central banks announced interest rate hikes, which made the market worry more about the global economic recession. In addition, last week, Fed Governor Waller made a speech on US monetary policy, supporting another 75 basis points interest rate hikes in July. Many governments have announced to raise the interest rate, heightening market worries of economic recession. US employment market performed well, which, however, aggravated market worries over more aggressive interest rate hikes in the future. Hence, the market was full of bearish sentiment though the US dollar index fell. In addition, the downstream in China recovered slowly, and the acceptance of high zinc prices was low. China imported 3,200 mt of refined zinc in May 2022, up 111.41% on the month, and down 94.35% on the year. From January to May, the total imports of refined zinc stood at 46,600 mt, a year-on-year decrease of 79.87%. Total exports of refined zinc stood at 35,500 mt, with net imports of -32,200 mt in May 2022. Technically market is under short covering as market has witnessed drop in open interest by -20.69% to settled at 786 while prices up 0.95 rupees, now Zinc is getting support at 308.2 and below same could see a test of 304.1 levels, and resistance is now likely to be seen at 315, a move above could see prices testing 317.7.

Trading Ideas:
* Zinc trading range for the day is 304.1-317.7.
* Zinc dropped as the market players were again deeply worried about the economic recession
* China imported 3,200 mt of refined zinc in May 2022, up 111.41% on the month, and down 94.35% on the year.
* Kazakhstan's January-May production of refined zinc was down 5.4%

Aluminium

Aluminium yesterday settled up by 0.14% at 215.65 as China's aluminium imports in May fell 16.4% from the same month a year earlier, government data showed, amid high overseas prices and weaker domestic consumption. The country brought in 188,469 tonnes of unwrought aluminium and products – including primary metal and unwrought, alloyed aluminium – last month, according to data from the General Administration of Customs. Monthly aluminium imports into China, the world's biggest producer and consumer of the metal, have been below 200,000 tonnes so far this year as an arbitrage window for cheaper overseas metal shut and downstream demand weakened due to COVID-19 induced lockdowns. The May imports were up slightly from 175,289 tonnes in April however. China's exports of unwrought aluminium and aluminium products jumped 54% from a year earlier to 676,605 tonnes in May, its highest in at least nine years. Global primary aluminium output in May rose 0.43% year on year to 5.805 million tonnes, data from the International Aluminium Institute (IAI) showed. Estimated Chinese production increased to 3.42 million tonnes in May, up from 3.355 million tonnes in May last year, IAI data shows. Technically market is under short covering as market has witnessed drop in open interest by -18.35% to settled at 2274 while prices up 0.3 rupees, now Aluminium is getting support at 213.3 and below same could see a test of 210.9 levels, and resistance is now likely to be seen at 217.4, a move above could see prices testing 219.1.

Trading Ideas:
* Aluminium trading range for the day is 210.9-219.1.
* Aluminium prices gained as China's May aluminium imports drop 16% y/y
* Global May aluminium output rises 0.4% y/y to 5.8 mln tonnes
* Estimated Chinese production increased to 3.42 million tonnes in May, up from 3.355 million tonnes in May last year

Mentha oil
Mentha oil yesterday settled down by -1.02% at 1027.5 on profit booking as Synthetic Mentha supply remains uninterrupted. Many states have seen gutkha and pan masala ban which have seen a lower demand from the pan masala industry. However, downside seen limited amid low production this season and improving demand post-pandemic. The harvest is expected to be almost the same as last year's in Barabanki area but harvesting this year is expected to be delayed. Crop growth is poor this year compared with last year despite use of fertiliser. The plant is about 25% less than the total crop, water is being felt after every three days. The production of Mentha oil was historically high in 2020-21, the area remained almost similar last year but the yields were lower which affected the production. In the current year we forecast production to fall to around 46,238 MT due to sharp fall in area and loss in yields following severe summer heat. which will come closed 14% down in the year 20-21. Germany's BASF said it would have to stop production if natural gas supplies fell to less than half its needs, as the world's largest chemicals group warned of the damage to its operations from Europe's power crunch. In Sambhal spot market, Mentha oil dropped by -22.2 Rupees to end at 1144.3 Rupees per 360 kgs.Technically market is under long liquidation as market has witnessed drop in open interest by -11.41% to settled at 629 while prices down -10.6 rupees, now Mentha oil is getting support at 1022.6 and below same could see a test of 1017.8 levels, and resistance is now likely to be seen at 1031.6, a move above could see prices testing 1035.8.

Trading Ideas:
* Mentha oil trading range for the day is 1017.8-1035.8.
* In Sambhal spot market, Mentha oil dropped  by -22.2 Rupees to end at 1144.3 Rupees per 360 kgs.
* Mentha oil settled down as Synthetic Mentha supply remains uninterrupted.
* Many states have seen gutkha and pan masala ban which have seen a lower demand from the pan masala industry.
* However, downside seen limited amid low production this season and improving demand post-pandemic.

Turmeric

Turmeric yesterday settled down by -2.01% at 7708 amid reports of sufficient stocks and good sowing progress in south India is pressurizing the prices. As per latest export figures, turmeric exports in Mar 2022 jumped higher 27.4% y/y at 15,750 tonnes vs 12,360 tonnes while for the period of Jan-Mar 2022, exports are only down by 1.15% y/y at 36,750 tonnes. In FY 2021/22, exports were down 16.7% y/y at 1.53 lakh tons but higher by 10% compared with 5-year average. The arrivals of New season turmeric are diminishing and exports demand is improving as season progresses. Traders and exporters are expecting the prices to remain stable as Maharashtra and Andhra Pradesh turmeric arrivals have also increased. Kocha arrivals are good at markets in Sangli, Hingoli and Nanded regions in Maharashtra. Due to aggressive coverages by oleoresin companies, prices were steady during the month. Panangali arrivals have started in Salem, Erode and Gundalpet markets. Turmeric harvesting in Indonesia is likely to start during June – July 2022. Crop is reported to be normal. Domestic demand reduced particularly with the new season crop supplies from Marathwada region of Maharashtra during April. Turmeric all India production for 2022 is estimated at 4.67 lakh tonnes, revised after crop damage due to excessive rainfall in Maharashtra, Andhra Pradesh and Telangana during October and November. In Nizamabad, a major spot market in AP, the price ended at 8276.55 Rupees gained 59.45 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -2.57% to settled at 16480 while prices down -158 rupees, now Turmeric is getting support at 7590 and below same could see a test of 7472 levels, and resistance is now likely to be seen at 7864, a move above could see prices testing 8020.

Trading Ideas:
* Turmeric trading range for the day is 7472-8020.
* Turmeric dropped amid reports of sufficient stocks and good sowing progress in south India is pressurizing the prices.
* As per latest export figures, turmeric exports in Mar 2022 jumped higher 27.4% y/y at 15,750 tonnes vs 12,360 tonnes
* For the period of Jan-Mar 2022, exports are only down by 1.15% y/y at 36,750 tonnes.
* In Nizamabad, a major spot market in AP, the price ended at 8276.55 Rupees gained 59.45 Rupees.

Jeera

Jeera yesterday settled down by -1.92% at 20665 as Cumin exports dropped by 60.58% in March 2022 to around 13406.43 tonnes as against 33203.08 tonnes in March 2021. However downside seen limited because of lower production of the spice in the country, partly because many farmers shifted to more lucrative commodities. daily basis Jeera arrivals in Unjha market were around 5,000 bags, Saurashtra and Gondal market around 800 t0 1,000 bags are arriving. Similarly, in Rajasthan also daily arrivals have remained weak, in Jodhpur market around 1,500 bags, at Nagaur 500 bags and other centres 500 bags arrivals noted. In Rajasthan, the new crop of cumin in the current year has come only 60% i.e. around 30 lakh bags as compared to last year. The arrival of cumin in Rajasthan has been only 50% in the peak season in the current year as compared to the previous years as the crop was less. There was a drought in Turkey and Syria and due to state tensions, the sowing of cumin seeds has been reported to be very low. Export demand for cumin seeds is expected to increase for the rest of the season due to reports of very low harvests in Turkey, Syria and Afghanistan. In Unjha, a key spot market in Gujarat, jeera edged down by -199.65 Rupees to end at 21242.2 Rupees per 100 kg.Technically market is under long liquidation as market has witnessed drop in open interest by -2.53% to settled at 13977 while prices down -405 rupees, now Jeera is getting support at 20475 and below same could see a test of 20285 levels, and resistance is now likely to be seen at 20905, a move above could see prices testing 21145.

Trading Ideas:
* Jeera trading range for the day is 20285-21145.
* Jeera dropped as Cumin exports dropped by 60.58% in March 2022 to around 13406.43 tonnes as against 33203.08 tonnes in March 2021.
* In Rajasthan, the new crop of cumin in the current year has come only 60% i.e. around 30 lakh bags as compared to last year.
* Export demand for cumin seeds is expected to increase for the rest of the season due to reports of very low harvests in Turkey, Syria and Afghanistan.
* In Unjha, a key spot market in Gujarat, jeera edged down by -199.65 Rupees to end at 21242.2 Rupees per 100 kg.

Cotton

Cotton yesterday settled down by -0.7% at 46930 as sowing could accelerate as the monsoon's progress will help farmers. India's annual monsoon rainfall has covered more than half of the country and conditions are favourable for it to advance into central, northern and western regions this week, the weather department said. In Karnataka, cotton acreages stood at 1.21 lakh hectares as of June 10 compared to 0.59 lakh ha in the same period last year. In several parts of Karnataka, including Chamrajanagar, Haveri and Gadag districts, the long-staple variety of cotton is planted early in the season, where farmers have brought in more area under the fibre crop. Cotton Association of India (CAI) on Saturday reduced its estimate for the cotton crop output for the current season beginning October 2021 to 315.32 lakh bales of 170 kg each, 8.31 lakh bales lower from its previous projection. In the year-ago season (2020-21), the country's total cotton production stood at 353 lakh bales, CAI (Cotton Association of India) said in its latest estimate for the month of May this year. Giving state-wise estimates, CAI said the production in Gujarat is projected at 79.75 lakh bales for the 2021-22 season. Telangana is estimated to produce 35.40 lakh bales, while the outputs in Maharashtra and Karnataka are estimated at 77.50 lakh bales and 20.25 lakh bales, respectively. In spot market, Cotton dropped by -300 Rupees to end at 47600 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -4.36% to settled at 2128 while prices down -330 rupees, now Cotton is getting support at 46360 and below same could see a test of 45780 levels, and resistance is now likely to be seen at 47310, a move above could see prices testing 47680.

Trading Ideas:
* Cotton trading range for the day is 45780-47680.
* Cotton prices dropped as sowing could accelerate as the monsoon's progress will help farmers.
* In Karnataka, cotton acreages stood at 1.21 lakh hectares as of June 10 compared to 0.59 lakh ha in the same period last year.
* CAI lowers cotton crop estimate for current season
* In spot market, Cotton dropped  by -300 Rupees to end at 47600 Rupees.

-www.kediaadvisory.com

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# In spot market, Cotton gained  by 290 Rupees to end at 48250 Rupees.