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Gold
Gold yesterday settled up by 0.16% at 51051 with investors seeking the safe-haven commodity amid rising worries about global economic slowdown. The World Bank slashed its global growth forecast by nearly a third to 2.9% for 2022, warning that Russia's invasion of Ukraine has compounded the damage from the COVID-19 pandemic, and many countries now faced recession The focus was on U.S. consumer price data due on Friday which could provide clues on whether the Fed will continue with its aggressive policy stance in the second half of the year. The U.S. central bank is widely expected to raise interest rates at its meeting this month, a prospect that helped the dollar index rise 0.2% and kept the 10-year U.S. Treasury. Demand for gold will dip this year, mainly due to weaker jewellery sales and retail investment in China due to COVID-19 lockdowns and an economic slowdown, consultants Metals Focus said. Supply of gold, meanwhile, will rise slightly as mines expand production and recycling increases, Metals Focus said in its annual Gold Focus report. The consultancy expects a soft landing for the global economy, but higher interest rates resulting from central banks fighting inflation will weigh on prices in the second half of the year. Technically market is under short covering as market has witnessed drop in open interest by -0.2% to settled at 14359 while prices up 83 rupees, now Gold is getting support at 50883 and below same could see a test of 50715 levels, and resistance is now likely to be seen at 51187, a move above could see prices testing 51323.
Trading Ideas:
* Gold trading range for the day is 50715-51323.
* Gold settled higher with investors seeking the safe-haven commodity amid rising worries about global economic slowdown.
* World Bank cuts 2022 global growth forecast
* Gold demand to falter as Chinese buying weakens

Silver
Silver yesterday settled down by -0.35% at 62026 as investors weighed the impact of central bank policy tightening on inflation and economic growth. The European Central Bank is set to draw a line under its massive bond-buying stimulus program on Thursday and signal its first-rate hike in over a decade. Amid increasing signs of inflation, markets are now pricing in 75 basis points of increases by September. The World Bank slashed its global growth forecast by nearly a third to 2.9% for 2022, warning that Russia's invasion of Ukraine has compounded the damage from the COVID-19 pandemic, and many countries now faced recession. The U.S. trade deficit narrowed by the most in nearly 9-1/2 years in April as exports jumped to a record high, putting trade on course to contribute to economic growth this quarter. Japan's economy shrank an annualised 0.5% in the first quarter, slightly better than the initial estimate of a 1.0% contraction, revised government data showed. U.S. Treasury Secretary Janet Yellen told senators that she expected inflation to remain high and the Biden administration would likely increase the 4.7% inflation forecast for this year in its budget proposal. The U.S. Federal Reserve is expected to raise its benchmark funds rate by 50 basis points next week and again in July. Technically market is under fresh selling as market has witnessed gain in open interest by 5.6% to settled at 11675 while prices down -217 rupees, now Silver is getting support at 61533 and below same could see a test of 61039 levels, and resistance is now likely to be seen at 62448, a move above could see prices testing 62869.
Trading Ideas:
* Silver trading range for the day is 61039-62869.
* Silver dropped as investors weighed the impact of central bank policy tightening on inflation and economic growth.
* The U.S. trade deficit narrowed by the most in nearly 9-1/2 years in April as exports jumped to a record high.
* Japan's economy shrank an annualised 0.5% in the first quarter, slightly better than the initial estimate of a 1.0% contraction

Crude oil
Crude oil yesterday settled up by 3.87% at 9524 on expectations of solid demand and low inventories. Investors cheered prospects of increased demand from China as Beijing and Shanghai gradually open up following almost two months of COVID-related lockdowns. U.S. crude production and petroleum demand will both rise in 2022 as the economy grows, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO). EIA projected crude production will rise to 11.92 million barrels per day (bpd) in 2022 and 12.97 million bpd in 2023 from 11.19 million bpd in 2021. Efforts by OPEC+ oil producers to boost output are "not encouraging", UAE energy minister Suhail al-Mazrouei said, noting the group was currently 2.6 million barrels per day short of its target. "According to last month's report, we have seen the conformity (to output cuts) of the OPEC+ group and the conformity was more than 200%," Mazrouei told. Conformity above 100% means a country is producing less than what it is supposed to be as OPEC+ looks to gradually remove its production curbs. Goldman Sachs increased its Brent oil price forecasts by $10 to $135 a barrel for the period between the second half of 2022 and the first half of next year, reasoning that a structural supply deficit was still unresolved. Technically market is under fresh buying as market has witnessed gain in open interest by 29.8% to settled at 14345 while prices up 355 rupees, now Crude oil is getting support at 9347 and below same could see a test of 9169 levels, and resistance is now likely to be seen at 9631, a move above could see prices testing 9737.
Trading Ideas:
* Crude oil trading range for the day is 9169-9737.
* Crude oil gains on expectations of solid demand and low inventories.
* U.S. crude output and petroleum demand to rise in 2022 – EIA
* OPEC+ efforts to boost oil output 'not encouraging', UAE minister says

Natural Gas
Nat.Gas yesterday settled down by -5.38% at 684.4 on reports of a fire at the Freeport liquefied natural gas (LNG) export plant in Texas. Earlier in the day, gas prices rose on forecasts for hotter weather and higher demand next week, a decline in output, low wind power, and record power demand in Texas. Power demand in Texas broke the June record and will continue rising until it breaks the all-time high later this week as economic growth boosts overall usage and hot weather causes homes and businesses to crank up their air conditioners. U.S. natural gas production and demand will both rise in 2022 as the economy grows, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO). EIA projected that dry gas production will rise to 96.50 billion cubic feet per day (bcfd) in 2022 and 101.57 bcfd in 2023 from a record 93.55 bcfd in 2021. The agency also projected gas consumption would rise from 82.98 in 2021 to 85.33 bcfd in 2022 before sliding to 85.15 bcfd in 2023. That compares with a record 85.29 bcfd in 2019. Data provider Refinitiv said average gas output in the U.S. Lower 48 states fell to 94.7 billion cubic feet per day (bcfd) so far in June from 95.1 bcfd in May. Technically market is under long liquidation as market has witnessed drop in open interest by -37.88% to settled at 6003 while prices down -38.9 rupees, now Natural gas is getting support at 645.2 and below same could see a test of 606.1 levels, and resistance is now likely to be seen at 736.5, a move above could see prices testing 788.7.
Trading Ideas:
* Natural gas trading range for the day is 606.1-788.7.
* Natural gas dropped on reports of a fire at the Freeport liquefied natural gas (LNG) export plant in Texas.
* U.S. natgas output, demand to hit record highs in 2022 – EIA
* Average gas output in the U.S. Lower 48 states fell to 94.7 billion cubic feet per day (bcfd) so far in June from 95.1 bcfd in May.

Copper
Copper yesterday settled up by 0.2% at 796.95 amid demand optimism due to the easing of COVID-19 restrictions in top consumer China and declining inventories offered support. Beijing and commercial hub Shanghai have been returning to normal in recent days after two months of bitter isolation under a ruthless lockdown. The U.S. Federal Reserve is expected to raise its benchmark funds rate by 50 basis points next week and again in July to fight soaring inflation. Chile, the world's top copper producer, saw exports of the red metal reach $3.76 billion in May, down 18.3% from a year earlier, the central bank said. Japan's economy shrank slightly less than initially reported in the first quarter, as private consumption remained resilient in the face of resurgent COVID-19 infections and companies rebuilt their stock. Peru's government called for a new round of talks with protesting indigenous communities that have forced MMG Ltd's Las Bambas copper mine to suspend operations for over a month. Fund managers have reduced their short positions on both the CME and London Metal Exchange (LME) copper contracts over the last two weeks as China gradually emerges from lockdowns. Technically market is under short covering as market has witnessed drop in open interest by -2.35% to settled at 3568 while prices up 1.6 rupees, now Copper is getting support at 792.4 and below same could see a test of 787.8 levels, and resistance is now likely to be seen at 800.2, a move above could see prices testing 803.4.
Trading Ideas:
* Copper trading range for the day is 787.8-803.4.
* Copper prices edged higher amid demand optimism due to the easing of COVID-19 restrictions in top consumer China and declining inventories offered support.
* Beijing and commercial hub Shanghai have been returning to normal in recent days after two months of bitter isolation under a ruthless lockdown.
* Chile saw exports of the red metal reach $3.76 billion in May, down 18.3% from a year earlier

Zinc
Zinc yesterday settled up by 0.98% at 330.05 as the supply side remained relatively tight, and cost support was also strong supported prices. On the supply side, SHFE/LME price ratio stood between 6.4-6.7, and the import window for ore closed. Domestic traders and smelters were less interest in purchasing overseas ores, resulting in extended supply tightness in China. On the consumption side, traders slightly lowered their offers along with falling zinc prices. But the downstream demand is recovering slowly, and the marginal weakness of COVID impacts on the production side has not yet paid off. According to the data released by the London Metal Exchange (LME), last week, there were only three trading days in the LME market due to the British bank holiday and the Platinum Jubilee Bank Holiday. On June 1, the LME zinc inventory continued to fall, reaching a new low of 83,575 mt in more than two years. The LME zinc inventory rebounded, increasing by 4,500 mt to 88,075 mt, which was the highest level in nearly a month. According to the data published by the Shanghai Futures Exchange, SHFE zinc inventory has fluctuated within a certain range in the past three months. Technically market is under short covering as market has witnessed drop in open interest by -2.94% to settled at 1025 while prices up 3.2 rupees, now Zinc is getting support at 326.9 and below same could see a test of 323.8 levels, and resistance is now likely to be seen at 332.1, a move above could see prices testing 334.2.
Trading Ideas:
* Zinc trading range for the day is 323.8-334.2.
* Zinc prices gained as the supply side remained relatively tight, and cost support was also strong supported prices.
* While the ambiguous recovery of the demand side in China also rattled the nerves of investors.
* LME zinc inventory rebounded while Shfe zinc inventory fell slightly

Aluminium
Aluminium yesterday settled up by 1.4% at 238.4 amid demand revival hopes on top consumer China relaxing its COVID-19 curbs and declining inventories. Aluminium stocks at three major Japanese ports dipped 2.9% to 344,000 tonnes at the end of April from 354,300 tonnes at the end of March, Marubeni Corp said. Global aluminium producers have offered Japanese buyers premiums of $172 to $177 a tonne for July-September primary metal shipments, which would be between unchanged and 2.9% higher compared with the current quarter. For the April-June quarter, Japanese buyers agreed to pay a premium of $172 per tonne, down 2.8% from the prior quarter. Japanese buyers said the initial offers were too high, as local spot premiums were hovering at around $140-$150 a tonne, reflecting slack demand from automakers amid a global supply chain crunch. The alumina market transaction was sluggish today, and the alumina price did not fluctuate much for the time being. The supply side bodes ill for alumina prices. Hebei Wenfeng alumina project is running at 2.4 million mt/year, and released output in May, which has had an impact on the northern spot market; in the south-west China, Chongqing Wanbo alumina project is running at 3.6 million mt/year, with another 1.2 million mt to be put into operation in the future. Technically market is under short covering as market has witnessed drop in open interest by -4.56% to settled at 2555 while prices up 3.3 rupees, now Aluminium is getting support at 235.2 and below same could see a test of 231.9 levels, and resistance is now likely to be seen at 240.6, a move above could see prices testing 242.7.
Trading Ideas:
* Aluminium trading range for the day is 231.9-242.7.
* Aluminium prices gains amid demand revival hopes on China relaxing its COVID-19 curbs
* Japan aluminium stocks in April down 2.9% m/m
* Global aluminium producers seek Q3 premiums of $172 – $177/T in Japan talks

Mentha oil
Mentha oil yesterday settled up by 0.58% at 1034.2 amid low production this season and improving demand post-pandemic. Support also seen with Rupee weakness export demand is going to be firm also post pandemic global demand is improving. However, upside seen limited as Synthetic Mentha supply remains uninterrupted. 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. Prices gained on reports that due to poor prices farmers has shifted to other crops resulting lower production. 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. Mentha farming has lost its allure in Uttar Pradesh as farmers struggle without stable price, MSP and government support. High input costs and lack of support price have drastically brought down the return of farmers who have already been struggling to increase their incomes. In Sambhal spot market, Mentha oil dropped by -13.9 Rupees to end at 1155.3 Rupees per 360 kgs.Technically market is under fresh buying as market has witnessed gain in open interest by 0.98% to settled at 930 while prices up 6 rupees, now Mentha oil is getting support at 1022.8 and below same could see a test of 1011.5 levels, and resistance is now likely to be seen at 1040.7, a move above could see prices testing 1047.3.
Trading Ideas:
* Mentha oil trading range for the day is 1011.5-1047.3.
* In Sambhal spot market, Mentha oil dropped  by -13.9 Rupees to end at 1155.3 Rupees per 360 kgs.
* Mentha oil prices seen supported in recent sessions amid low production this season and improving demand post-pandemic.
* Synthetic Mentha supply remains uninterrupted.
* With Rupee weakness export demand is going to be firm also post pandemic global demand is improving.

Turmeric
Turmeric yesterday settled up by 0.66% at 8176 as 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. Currently, export demand is normal but is expected to pick up. As per latest export figures, turmeric exports in Feb 2022 were lower by 17% y/y at 10400 tonnes vs 12,575 tonnes while in FY 2021/22 (Apr-Feb), exports down 20% at 1.37 lakh tons compared to last year but higher by 8.3% compared with 5-year average. Domestic demand reduced particularly with the new season crop supplies from Marathwada region of Maharashtra during April. Export demand too reported sluggish despite report of some queries from Bangladesh. 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 8203.7 Rupees gained 21.7 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 15.91% to settled at 9290 while prices up 54 rupees, now Turmeric is getting support at 8112 and below same could see a test of 8050 levels, and resistance is now likely to be seen at 8216, a move above could see prices testing 8258.
Trading Ideas:
* Turmeric trading range for the day is 8050-8258.
* Turmeric prices seen supported as the arrivals of New season turmeric are diminishing and exports demand is improving.
* Traders and exporters are expecting the prices to remain stable as Maharashtra and Andhra Pradesh turmeric arrivals have also increased.
* Turmeric harvesting in Indonesia is likely to start during June – July 2022 and crop is reported to be normal.
* In Nizamabad, a major spot market in AP, the price ended at 8203.7 Rupees gained 21.7 Rupees.

Jeera
Jeera yesterday settled up by 0.33% at 21445 because of lower production of the spice in the country, partly because many farmers shifted to more lucrative commodities. Cumin exports dropped by 60.58% in March 2022 to around 13406.43 tonnes as against 33203.08 tonnes in March 2021. On 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. Currently, steady demand can be seen from Bangladesh and other Islamic countries. And due to Bakri-Eid in July further increase in demand is expected. Demand from China has declined due to higher domestic prices in India. Around 32,407 tonnes and 42,788 tonnes have been exported to Bangladesh and China respectively during 2021-22 (Apr-Feb). Cumin seed exports during the current season are likely to remain low as the current crop is very less this time. Cumin seed exports during 2021-22 (Apr-Feb) has declined by 24 percent at 1.91 lakh tonnes as compared to 2.52 lakh tonnes exported last year same period In Unjha, a key spot market in Gujarat, jeera edged down by -67.7 Rupees to end at 21386.9 Rupees per 100 kg.Technically market is under fresh buying as market has witnessed gain in open interest by 14.77% to settled at 10395 while prices up 70 rupees, now Jeera is getting support at 21385 and below same could see a test of 21330 levels, and resistance is now likely to be seen at 21490, a move above could see prices testing 21540.
Trading Ideas:
* Jeera trading range for the day is 21330-21540.
* Jeera gains because of lower production of the spice in the country, partly because many farmers shifted to more lucrative commodities.
* Currently, steady demand can be seen from Bangladesh and other Islamic countries. And due to Bakri-Eid in July further increase in demand is expected.
* Cumin exports dropped by 60.58% in March 2022 as compared to March 2021
* In Unjha, a key spot market in Gujarat, jeera edged down by -67.7 Rupees to end at 21386.9 Rupees per 100 kg.

Cotton
Cotton yesterday settled up by 1.08% at 45780 as India’s cotton sowing acreage declined 2.35 per cent to 10.73 lakh hectare till June 3 this season, according to the first weekly Kharif 2022 sowing report, released by the ministry of agriculture. Cotton planting in India could jump as much as 15% in 2022 to an all-time high, as strong prices prompt farmers to switch away from other crops. A 15% rise in India's cotton crop area would lift it to around 13.8 million hectares in 2022 from 12 million hectares last year. Currently, sowing in Karnataka & Northern states of Haryana, Punjab and Rajasthan recorded slow progress. Cotton was sown on around 13.08 lakh hectare during the corresponding period of last year. The area coverage has been reported mainly from the states of Haryana (5.90 lakh ha), Punjab (2.31 lakh ha), Rajasthan (1.54 lakh ha) and Karnataka (0.72 lakh ha). Cotton sowing is delayed in Punjab, Haryana and Rajasthan due to delay in release of canal water. Normally, the sowing should have been completed till mid of May, but large number of farmers could not sow the fibre crop during the sowing period. As per information, farmers have shifted to other crops as delayed cotton sowing is prone to disease. In spot market, Cotton gained by 10 Rupees to end at 47100 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -0.89% to settled at 2563 while prices up 490 rupees, now Cotton is getting support at 45400 and below same could see a test of 45020 levels, and resistance is now likely to be seen at 46010, a move above could see prices testing 46240.
Trading Ideas:
* Cotton trading range for the day is 45020-46240.
* Cotton gains as India’s cotton sowing acreage declined 2.35 per cent to 10.73 lakh hectare till June 3 this season
* Cotton planting in India, could jump as much as 15% in 2022 to an all-time high
* A 15% rise in India's cotton crop area would lift it to around 13.8 million hectares in 2022 from 12 million hectares last year.
* In spot market, Cotton gained  by 10 Rupees to end at 47100 Rupees.

- www.kediaadvisory.com

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