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Gold

yesterday settled up by 0.17% at 47291 as world shares dipped after data showed slower-than-expected growth in China’s economy last quarter and surging oil prices fed inflation concerns. Market positioning also indicated an increasing expectation that central banks will prioritize policy tightening to curb inflation despite concerns on global growth, as various economic data and new information come in showing different economic situations and guiding markets on likely policy response divergences. Current high levels of inflation may not abate as soon as many U.S. Federal Reserve policymakers expect, St. Louis Fed President James Bullard said, as he once again urged the central bank to pursue a faster taper of its bond-buying program. “I think this is concerning,” Bullard told a virtual gathering of the Euro50 Group, with regard to inflation. “While I do think there is some probability that this will naturally dissipate over the next six months, I wouldn’t say that’s such a strong case that we can count on that happening.” Bullard added that he sees only a 50% probability either way. Federal Reserve Governor Michelle Bowman said she would be "very comfortable" with beginning to withdraw some of the U.S. central bank's crisis-era support for the economy as soon as next month, citing concerns about inflation and asset bubbles. Technically market is under short covering as market has witnessed drop in open interest by -2.28% to settled at 11855 while prices up 78 rupees, now Gold is getting support at 47161 and below same could see a test of 47031 levels, and resistance is now likely to be seen at 47429, a move above could see prices testing 47567.

Trading Ideas:
* Gold trading range for the day is 47031-47567.
* Gold remained supported as world shares dipped after data showed slower-than-expected growth in China’s economy last quarter.
* Market positioning also indicated an increasing expectation that central banks will prioritize policy tightening to curb inflation
* Fed should pursue faster taper, inflation levels "concerning" -Bullard



Silver

yesterday settled down by -0.01% at 63266 as an uptick in U.S. bond yields and a stronger dollar dented bullion's appeal. Rising energy prices also added to worries about inflation and stoked bets that the Federal Reserve may need to act faster to normalize policy. Fed funds futures are now fully pricing in a rate hike by September 2022. Elsewhere, Bank of England Governor Andrew Bailey sent a fresh signal that the British central bank is gearing up to raise interest rates for the first time since the onset of the coronavirus crisis as inflation risks mount. China’s gross domestic product grew 4.9% in the July-September quarter from a year earlier, its weakest pace since the third quarter of 2020. The world’s second-largest economy is grappling with power shortages, supply bottlenecks, sporadic COVID-19 outbreaks and debt problems in its property sector. Investors also continued to worry about global inflation, which was being driven by the reopening of many economies after COVID-19 restrictions and supply chain issues, and prospects central banks will tighten policy sooner rather than later. Industrial production in the United States fell 1.3 percent in September 2021, following a revised 0.1 percent contraction in August and missing market expectations of 0.2 percent growth, with about 0.6 percentage point of the drop resulting from the impact of Hurricane Ida. Technically market is under fresh selling as market has witnessed gain in open interest by 3.79% to settled at 10202 while prices down -5 rupees, now Silver is getting support at 62834 and below same could see a test of 62403 levels, and resistance is now likely to be seen at 63666, a move above could see prices testing 64067.

Trading Ideas:
* Silver trading range for the day is 62403-64067.
* Silver remained in range as an uptick in U.S. bond yields and a stronger dollar dented bullion's appeal.
* Fed funds futures are now fully pricing in a rate hike by September 2022.
* BOE governor Bailey sent a fresh signal that the British central bank is gearing up to raise interest rates.



Crude oil

yesterday settled down by -0.02% at 6145 after data showed US industrial activity unexpectedly fell for the 2nd month in September and China GDP growth slowed more than expected in Q3. OPEC+ compliance with oil cuts fell slightly to 115% in September, indicating that as the alliance raises production targets, some members are still falling short as they face challenges in pumping more oil. The Organization of the Petroleum Exporting Countries and allies led by Russia, or OPEC+ as the alliance is known, raised its output targets by 400,000 barrels per day (bpd) in September. It has also agreed to raise them by a further 400,000 bpd in October and in November. Iraq's oil ministry spokesman said that an oil price above $80 is "a positive indicator" but needs long term stability. The oil ministry cited Asim Jihad on its Telegram channel as also saying that Iraq aims to achieve the highest financial revenues by committing to the OPEC+ agreement. He added that the challenges of the global oil market are still present due to not fully containing the coronavirus and its variants. Earlier this month, OPEC+ stuck to its agreement of increasing production by 400,000 bpd a month as it unwinds production cuts. Technically market is under fresh selling as market has witnessed gain in open interest by 17.54% to settled at 4288 while prices down -1 rupees, now Crude oil is getting support at 6093 and below same could see a test of 6041 levels, and resistance is now likely to be seen at 6240, a move above could see prices testing 6335.

Trading Ideas:
* Crude oil trading range for the day is 6041-6335.
* Crude oil eased after data showed US industrial activity unexpectedly fell for the 2nd month in September
* OPEC+ misses target again, as some members struggle to raise oil output
* Iraq says oil price above $80 is 'a positive indicator'



Nat.Gas

yesterday settled down by -6.97% at 382 as output slowly rises and on forecasts for the weather to remain milder than normal through early November. The decline came despite a slow but steady increase in U.S. liquefied natural gas (LNG) exports. Global gas prices were up 17% on Monday as utilities in Europe and Asia scrambled to fill inventories before the winter heating season. But no matter how high global prices rise, the United States was already close to producing LNG at full capacity. In addition, U.S. gas stockpiles, unlike those in Europe, were in good shape for the winter, with more than enough fuel available for the heating season. Speculators cut their net long positions on the New York Mercantile and Intercontinental Exchanges for a second week in a row last week to their lowest since April 2021, according to data from the Commodity Futures Trading Commission (CFTC). Data provider Refinitiv said gas output in the U.S. lower 48 states has risen to an average of 92.0 billion cubic feet per day (bcfd) so far in October from 91.1 bcfd in September. Refinitiv projected average U.S. gas demand, including exports, would rise from 86.6 bcfd this week to 89.7 bcfd next week as the weather turns seasonally cooler and more homes and businesses turn on their heaters. Technically market is under fresh selling as market has witnessed gain in open interest by 39.06% to settled at 5447 while prices down -28.6 rupees, now Natural gas is getting support at 372 and below same could see a test of 362.1 levels, and resistance is now likely to be seen at 398.8, a move above could see prices testing 415.7.

Trading Ideas:
* Natural gas trading range for the day is 362.1-415.7.
* Natural gas fell as output slowly rises and on forecasts for the weather to remain milder than normal through early November.
* The decline came despite a slow but steady increase in U.S. liquefied natural gas (LNG) exports.
* But no matter how high global prices rise, the United States was already close to producing LNG at full capacity.




Copper

yesterday settled up by 0.06% at 795.85 as inventories have hit a record low following production cuts in the wake of power crunch in Europe and China despite a drop in manufacturing activities. LME on-warrant copper stocks dropped to their lowest since 1998 at 14,150 tonnes, while ShFE copper inventories were at their lowest since June 2009 at 41,668 tonnes. China imported a record 4.06 lakh tonnes (lt) of unwrought copper and copper products last month after five months of continuous decline. LME stocks were at 1,81,400 tonnes with cancelled warrants, which means they have been earmarked for delivery, at 1,67,250 tonnes leaving live warrants at 14,150 tonnes. The stocks have nosedived to a 47-year low on the LME, while in Shanghai, they are down to their lowest in 14 years. Fitch Solutions Country Risk and Industry Research, a Fitch Group unit, increased its copper price forecast for this year to $9,200 from its earlier projection of $8,700. The increase has been made as copper prices “remain elevated over tight inventories despite having stabilised since reaching historical highs in May”, it said. According to the International Copper Study Group (ICSG), preliminary data indicate that world copper mine production increased by 4.9 per cent in the first half of this year and since June, output was up following the easing of Covid pandemic lockdowns. Technically market is under short covering as market has witnessed drop in open interest by -6.79% to settled at 4285 while prices up 0.5 rupees, now Copper is getting support at 787.4 and below same could see a test of 778.9 levels, and resistance is now likely to be seen at 808, a move above could see prices testing 820.1.

Trading Ideas:
* Copper trading range for the day is 778.9-820.1.
* Copper gains as inventories have hit a record low following production cuts in the wake of power crunch in Europe and China.
* LME on-warrant copper stocks dropped to their lowest since 1998 at 14,150 tonnes
* World copper mine production increased by 4.9 per cent in the first half of this year and since June, ICSG



Zinc

yesterday settled down by -4.37% at 308.4 on profit booking amid concern that slowing growth in top consumer China will impact demand. China's economy grew by 4.9% in the third quarter, its slowest pace in a year, hurt by power shortages, supply chain bottlenecks and troubles in the property market. In recent sessions, prices rallied as investors fretted over supply shortage amid production cuts due to electricity price hikes in Europe. Belgium-based Nyrstar said last week it would cut production by up to 50% at its three European zinc smelters and Glencore , which also has three zinc smelters in Europe, said it was "adjusting production" to save energy costs. Still, sky-high power prices are also lowering demand at metals-manufacturing companies and the Chinese state reserve bureau released 180,000 tonnes of zinc so far this year to contain prices. The global zinc surplus is likely to shrink to 44kt in 2022 from 217kt this year, according to the International Lead and Zinc Study Group. Global zinc consumption growth is estimated at 6.2% in 2021 before easing to 2.3% next year. The overseas production reduction amid rising electricity and carbon emission costs has been intensifying. Though Glencore announced that it will only apply staggered production, the market still heated up as it takes up a large amount of the total production. Technically market is under long liquidation as market has witnessed drop in open interest by -30.54% to settled at 1333 while prices down -14.1 rupees, now Zinc is getting support at 301.4 and below same could see a test of 294.5 levels, and resistance is now likely to be seen at 321, a move above could see prices testing 333.7.

Trading Ideas:
* Zinc trading range for the day is 294.5-333.7.
* Zinc dropped on profit booking amid concern that slowing growth in top consumer China will impact demand.
* In recent sessions, prices rallied as investors fretted over supply shortage amid production cuts due to electricity price hikes in Europe.
* Belgium-based Nyrstar said it would cut production by up to 50% at its three European zinc smelters and Glencore



Nickel

yesterday settled up by 0.09% at 1552.3 gains due to production curbs driven by power shortages in Asia and Europe. Also, inventories in ShFE warehouses hovered near a record low of 4,455 tonnes while stockpiles in LME warehouses declined to 149,412 tonnes, the lowest since December 2019. Meanwhile, Kosovo’s only ferro-nickel producer Newco Ferronikeli shut down production on Friday due to soaring energy prices. The ferronickel sector is more obviously influenced by the power rationing, while the demand from the stainless steel sector picked up. The demand from the new energy sector was still robust. And the low inventory of nickel will support the nickel prices to some extent. China’s industrial output rose 3.1% in September from a year earlier, missing expectations, and slowing from 5.3% in August, official data showed. Retail sales grew 4.4% in September on-year, compared with a forecast 3.3% increase and a 2.5% rise in August. Fixed asset investment increased 7.3% in the first nine months from the same period a year earlier, missing expectations for a 7.9% rise and slowing from an 8.9% jump in January-August. China’s economy has staged an impressive rebound from the COVID-19 pandemic but has recently shown signs of losing momentum, weighed down by power shortages, supply bottlenecks, sporadic COVID-19 outbreaks and regulatory crackdowns on sectors from tech to property. Technically market is under short covering as market has witnessed drop in open interest by -12.68% to settled at 1453 while prices up 1.4 rupees, now Nickel is getting support at 1543.3 and below same could see a test of 1534.4 levels, and resistance is now likely to be seen at 1568.4, a move above could see prices testing 1584.6.

Trading Ideas:
* Nickel trading range for the day is 1534.4-1584.6.
* Nickel gains due to production curbs driven by power shortages in Asia and Europe.
* Inventories in ShFE warehouses hovered near a record low of 4,455 tonnes
* Stockpiles in LME warehouses declined to the lowest since December 2019.



Aluminium

yesterday settled up by 0.43% at 255.35 as soaring energy prices intensified supply disruptions. China's September aluminium output in September declined for a fifth consecutive month due to Chinese electricity shortages. Smelters in China's Qinghai province were told to reduce production to lower the power load, while in Europe aluminum producers are also facing higher electricity charges, which have shrunk profit margins, causing aluminum smelters to curtail production. Dutch producer Alde announced it will cut output by 60-70% at its Delfzijl aluminum smelter due to costly electricity bills. Also, data from the General Administration of Customs showed China’s aluminum imports rose 2.2% from the previous month in September. Meanwhile, stocks started to rise from the China market in line with the seasonality pattern. According to Mysteel, inventories rose by 31kt since last Thursday to the latest total of 941kt. China's aluminium output in September declined for a fifth consecutive month, official data showed, as ongoing electricity shortages in the country led to deeper cuts in industrial production.The world's top producer of the metal churned out 3.08 million tonnes of primary aluminium last month, the National Bureau of Statistics said. That was down from 3.155 million tonnes in August, and also down 2.1% year-on-year. Technically market is under short covering as market has witnessed drop in open interest by -2.98% to settled at 2016 while prices up 1.1 rupees, now Aluminium is getting support at 253.1 and below same could see a test of 250.9 levels, and resistance is now likely to be seen at 258.4, a move above could see prices testing 261.5.

Trading Ideas:
* Aluminium trading range for the day is 250.9-261.5.
* Aluminum rose as soaring energy prices intensified supply disruptions.
* China's Sept aluminium output down 2.1% y/y at 3.08 mln tonnes
* China's September aluminium output in September declined for a fifth consecutive month due to Chinese electricity shortages.



Mentha oil

yesterday settled up by 0.89% at 931.6 on short covering after prices remained under pressure as demand from consumer side is extremely weak and industrial demand is also not picking up. Prices got support in last few weeks as due to crop failure and low recovery of oil, availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Major physical market player expects demand to sluggish for next few week as cash crunch seen in spot market, while expectations are high about demand improvement ahead of winter season starts. China is one of the biggest buyer for Indian Mentha, no much buying inquiry from China as mainland China and Hong Kong markets were shut. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Firstly damages due to rain in key area and secondly farmers for the last 2 years where sowing mentha but due to not getting much profit at intervals there had been shift to other crops also. In Sambhal spot market, Mentha oil gained by 11.8 Rupees to end at 1048.2 Rupees per 360 kgs.Technically market is under short covering as market has witnessed drop in open interest by -8.82% to settled at 1054 while prices up 8.2 rupees, now Mentha oil is getting support at 927.9 and below same could see a test of 924.3 levels, and resistance is now likely to be seen at 933.8, a move above could see prices testing 936.1.

Trading Ideas:
* Mentha oil trading range for the day is 924.3-936.1.
* In Sambhal spot market, Mentha oil gained  by 11.8 Rupees to end at 1048.2 Rupees per 360 kgs.
* Mentha oil gained on short covering after prices remained under pressure as demand from consumer side is extremely weak
* Prices got support in last few weeks as due to crop failure and low recovery of oil
* Availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season.



Soyabean

yesterday settled up by 3.06% at 5417 tracking firmness in overseas prices as strong demand for U.S. supplies underpinned prices. Soyabean production is estimated to rise by 14 per cent to nearly 119 lakh tonnes this year on higher sowing area and likely improvement in productivity, according to industry body SOPA. In its estimate, Soyabean Processors Association of India (SOPA) said that the total area under soybean for the year 2021 is 119.984 lakh hectares. The government's area estimate is 123.677 lakh hectares. In last year's Kharif (summer sow) season, total soyabean acreage stood at 118.383 lakh hectare. "Estimated total production of soybean crop for all India for the year 2021 is 118.889 lakh tons, which is higher by 14.337 lakh tons (13.71 per cent) as compared to last year," SOPA said. The production stood at 104.55 lakh tonnes last year. China's soybean imports in September fell 30% from the same month the previous year, customs data showed, as poor crush margins curbed demand. China, the world's top buyer of soybeans, brought in 6.88 million tonnes of the oilseed in September, down from 9.79 million tonnes last year, General Administration of Customs data showed. Chinese crushers stepped up purchases of soybeans earlier in the year in anticipation of strong demand from a fast-recovering pig herd. At the Indore spot market in top producer MP, soybean gained 99 Rupees to 5436 Rupees per 100 kgs.Technically market is under fresh buying as market has witnessed gain in open interest by 2.57% to settled at 82195 while prices up 161 rupees, now Soyabean is getting support at 5328 and below same could see a test of 5240 levels, and resistance is now likely to be seen at 5466, a move above could see prices testing 5516.

Trading Ideas:
* Soyabean trading range for the day is 5240-5516.
* Soyabean prices gained tracking firmness in overseas prices as strong demand for U.S. supplies underpinned prices.
* SOPA said that the total area under soybean for the year 2021 is 119.984 lakh hectares.
* China Sept soybean imports fall 30% y/y on slowing demand
* At the Indore spot market in top producer MP, soybean gained  99 Rupees to 5436 Rupees per 100 kgs.



Ref.Soyaoil

yesterday settled up by 0.18% at 1249.3 on some low level buying after prices dropped as India slashed its base import tax on crude palm oil, crude soyoil and crude sunflower oil to zero from 2.5%, as the world's biggest vegetable oil buyer tries to cool near-record price rises. The Govt. has decided to impose stock limits on edible oils and oilseeds up to March 31, 2022. This decision has been taken to soften the prices of edible oils in the country and provide relief to consumers. The Ministry said that the stock limits will be decided by the respective state governments depending on local conditions. It has however decided to give exemption to importers and exporters subject to conditions. Oilseeds output is also expected to be down a tad at 23.38 mt as soyabean production was affected by the patchy rains in the key producing States of Gujarat and Madhya Pradesh, respectively. Favorable weather over the weekend boosted U.S. harvest, while exports remain capped by terminals on the U.S. Gulf Coast that continue to struggle with power outages and hurricane-led damage as the country heads into its busiest export season. India's vegetable oil imports are likely to contract for the second straight year, the Solvent Extractors' Association of India (SEA) said. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1299.6 Rupees per 10 kgs.Technically market is under fresh buying as market has witnessed gain in open interest by 8.91% to settled at 29160 while prices up 2.3 rupees, now Ref.Soya oil is getting support at 1241 and below same could see a test of 1232 levels, and resistance is now likely to be seen at 1261, a move above could see prices testing 1272.

Trading Ideas:
* Ref.Soya oil trading range for the day is 1232-1272.
* Ref soyoil gained on some low level buying after prices dropped as India cuts base import tax on crude vegetable oil imports to zero %
* Oilseeds output is also expected to be down a tad at 23.38 mt as soyabean production was affected.
* India’s Sept edible oil stocks at ports and pipelines rose 3.24 percent mom: SEA
* At the Indore spot market in Madhya Pradesh, soyoil was steady at 1299.6 Rupees per 10 kgs.



Crude palm Oil

yesterday settled up by 0.27% at 1102.8 on some low level buying after prices dropped as the Indian Vegetable Oils Producers Association says it is seeing early signs of demand shifting from palm oil to soft oils after India's duty cut made soft oil more attractive. Malaysia's crude palm oil production in 2021 is forecast to decline by 700,000 tonnes to 18.4 million tonnes due to a labour shortage and erratic weather conditions, state agency the Malaysian Palm Oil Council (MPOC) said. Neighbouring Indonesia has not faced such labour issues and has expanded its planted area by about 200,000 hectares this year, MPOC chief executive Wan Zawawi Wan Ismail said. Production in the world's largest palm oil producer is projected to rise by 2.5 million tonnes to 45.5 million tonnes, he said. Indonesian palm oil exports in 2021 will likely be much lower than previously forecast, at 34.423 million tonnes, the vice chairman of the Indonesia Palm Oil Association (GAPKI) told. That would be lower than the 37.5 million tonnes forecast in February, and down 1.2% from the year earlier. Exports of crude palm oil in 2021 meanwhile are forecast to fall 54.37% from a year earlier to 3.272 million tonnes. GAPKI earlier forecast crude palm oil shipments to stand at 7.5 million tonnes this year. In spot market, Crude palm oil gained by 18.4 Rupees to end at 1121.2 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -3.41% to settled at 3457 while prices up 3 rupees, now CPO is getting support at 1094.9 and below same could see a test of 1087.1 levels, and resistance is now likely to be seen at 1109.7, a move above could see prices testing 1116.7.

Trading Ideas:
* CPO trading range for the day is 1087.1-1116.7.
* Crude palm oil gained on some low level buying after prices dropped as IVPA says sees demand shift from palm oil to soft oil after India's duty cut
* Malaysia's 2021 palm oil output seen lower at 18.4 mln T – MPOC
* Indonesia 2021 palm exports +1.2% y/y, crude palm oil exports drop
* In spot market, Crude palm oil gained  by 18.4 Rupees to end at 1121.2 Rupees.



Turmeric

yesterday settled up by 1.13% at 7358 following export demand from Europe, Gulf countries and Bangladesh. However upside seen limited amid prospects of better crop this kharif season along with tepid demand. The areas where turmeric has been sown have received adequate rainfall and are expected to produce well in the next season. Turmeric crops were severely damaged in Parbhani and Hingole due to heavy rains. India is on course to having a normal monsoon, which will recharge the country’s main water reservoirs just enough, and ensure that the most important crops for the kharif season have normal sowing. This is good news for agricultural production and food prices. Pressure also seen as the lockdown restrictions were eased the key Turmeric growing states, including Maharashtra and Telangana reported noticeable increase in mandi arrivals, which augmented physical market supplies and pressurized prices. According to the statistics of the Department of Commerce, Government of India, the highest number of 1.84 lakh tonnes of turmeric was exported during the last financial year 2020-21. In the first 6 months of 2021, turmeric exports declined by 3% to 77,300 tonnes compared to the same period last year, but could be higher in the coming months. In Nizamabad, a major spot market in AP, the price ended at 7141.35 Rupees gained 124.7 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 1.98% to settled at 10285 while prices up 82 rupees, now Turmeric is getting support at 7252 and below same could see a test of 7148 levels, and resistance is now likely to be seen at 7458, a move above could see prices testing 7560.

Trading Ideas:
*Turmeric trading range for the day is 7148-7560.
* Turmeric gained following export demand from Europe, Gulf countries and Bangladesh.
* However upside seen limited amid prospects of better crop this kharif season along with tepid demand.
* The areas where turmeric has been sown have received adequate rainfall and are expected to produce well.
* In Nizamabad, a major spot market in AP, the price ended at 7141.35 Rupees gained 124.7 Rupees.



Jeera

yesterday settled down by -0.03% at 14635 as adequate stock with traders and farmers may keeping prices under pressure at higher levels. However downside seen limited as the export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin in a big way. With the forecast of normal rains in the western region during September to November, the sowing of cumin seeds in Gujarat and Rajasthan may increase. In 2021 (January-June), the country has exported more than 1.50 lakh tonnes of cumin as compared to 1.3 lakh tonnes in the same period last year. Purchase of cumin seeds from African and Middle East countries will be diverted from other countries to India this year. Recent estimates state that cumin production has slumped by 60% in Iran’s Razavi Khorasan Province due to severe drought and unusually cold weather coupled with an early spring. Rainfall ranges 63% lower than last year this season so far. Temperatures ranged 3.1-0.4C (37.58-32.72F) lower between October 2020 and April 2021 than in the same period in 2019/2020 according to official statistics. Extensive crop losses seen, the early onset of spring in February also caused serious damage to production. In Unjha, a key spot market in Gujarat, jeera edged up by 29.5 Rupees to end at 14386.65 Rupees per 100 kg.Technically market is under fresh selling as market has witnessed gain in open interest by 0.88% to settled at 6543 while prices down -5 rupees, now Jeera is getting support at 14555 and below same could see a test of 14470 levels, and resistance is now likely to be seen at 14720, a move above could see prices testing 14800.

Trading Ideas:
* Jeera trading range for the day is 14470-14800.
* Jeera settled flat as adequate stock with traders and farmers may keeping prices under pressure at higher levels.
* However downside seen limited as the export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin
* India's cumin exports will increase due to less supply from Afghanistan-Syrian
* In Unjha, a key spot market in Gujarat, jeera edged up by 29.5 Rupees to end at 14386.65 Rupees per 100 kg.



Cotton

yesterday settled up by 0.1% at 30560 as India’s 2021-22 cotton consumption is forecast at a record 25.5 million bales and exports are projected at the second-highest level in 8 years at 5.8 million. This level of total use is forecast to lower ending stocks to 12.4 million bales, down nearly 4 million compared with the record level two years prior, according to US Department of Agriculture (USDA). Cotton stock levels in India nearly doubled to a record two years ago primarily due to two factors. First, production soared 3.0 million bales while consumption fell over 4.0 million. Second, India’s seed cotton prices fell below the Minimum Support Price (MSP), which drove record state purchases and storage of cotton lint in cotton year (CY) 2020 by the Cotton Corporation of India (CCI). However, due to record sales the next season, i.e. in 2020-21, CCI’s record stock levels quickly fell. Mills and exporters were eager buyers, with 2020-21 domestic consumption rising 4.0 million bales and exports at their highest in seven years at 6.2 million, the USDA report said. The USDA also raised global ending stock estimate by 450,000 bales to 87.13 million bales. Meanwhile, the agency lowered China consumption by 1 million bales, citing high prices and energy crisis denting industrial activity. In spot market, Cotton gained by 460 Rupees to end at 29280 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -5.69% to settled at 1891 while prices up 30 rupees, now Cotton is getting support at 30290 and below same could see a test of 30030 levels, and resistance is now likely to be seen at 31030, a move above could see prices testing 31510.

Trading Ideas:
* Cotton trading range for the day is 30030-31510.
* Cotton prices gained as India to see record cotton consumption & strong exports in 2021-22
* USDA also raised global ending stock estimate by 450,000 bales to 87.13 million bales.
* USDA lowered China consumption by 1 million bales, citing high prices and energy crisis denting industrial activity.
* In spot market, Cotton gained  by 460 Rupees to end at 29280 Rupees.

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