IGI Logo

Gold

Gold yesterday settled up by 0.36% at 49601 as the yields on long-term U.S. Treasury Notes dropped ahead of the upcoming jobs data. U.S. labor market signals are conflicting to an “unprecedented” degree, but those suggesting labor market slack should be given more weight than those pointing to tightness. The paper looked at 26 labor market measures that typically move in tandem and found that during the current recovery they are giving wildly divergent signals about the health of the job market. Investors were now awaiting U.S. payrolls data due on Friday to gauge cues on future monetary policy. Bottlenecks in the supply chain and rising commodity prices could limit U.S. manufacturing growth potential, and the Federal Reserve is paying attention to labour market data. The Perth Mint's gold sales fell to a four-month low in May, as an uptick in prices of the metal dented demand for minted products. Sales of gold coins and minted bars fell to 91,146 ounces in May, down 10% month-on-month, but 44% higher than a year earlier. India's gold imports in May surged more than nine-fold from last year's low base to 12 tonnes. In value terms, May gold imports surged to $679.16 million from $76.31 million a year earlier. Technically market is under short covering as market has witnessed drop in open interest by -0.06% to settled at 12481 while prices up 176 rupees, now Gold is getting support at 49379 and below same could see a test of 49157 levels, and resistance is now likely to be seen at 49745, a move above could see prices testing 49889.

Trading Ideas: 

* Gold trading range for the day is 49157-49889.

* Gold rebounded as the yields on long-term U.S. Treasury Notes dropped ahead of the upcoming jobs data.

* Benchmark, U.S. 10-year Treasury yields eased below 1.60%, reducing the opportunity cost of holding bullion, which pays no interest.

* Investors were now awaiting U.S. payrolls data due on Friday to gauge cues on future monetary policy.

Silver

Silver yesterday settled up by 0.6% at 72678 as U.S. Treasury yields pulled back, while investors awaited for key economic data this week that will shed light on the outlook for inflation. Traders also seem to be taking some profits ahead of the upcoming U.S. jobs data, due on Friday. The dollar is gaining in strength against its major rivals, buoyed by a pick up in U.S. manufacturing activity. Data from the Institute for Supply Management showed factory activity in the country expanded at a slightly faster pace in May. ISM's manufacturing PMI inched up to 61.2 in the month, up from 60.7 in April. The United States is getting closer to the Fed’s maximum employment and 2% inflation goals, Fed Governor Lael Brainard said, but the depth of the remaining problem still requires the central bank to stick to its super-easy monetary policy until more progress is seen. “While we are far from our goals today, we are seeing welcome progress, and I expect to see further progress,” Brainard told the Economic Club of New York. But “jobs are down by between 8 and 10 million compared with the level we would have seen in the absence of the pandemic. And it will be important to see sustained progress on inflation,” not just a temporary jump. Technically market is under fresh buying as market has witnessed gain in open interest by 1.89% to settled at 11273 while prices up 430 rupees, now Silver is getting support at 71998 and below same could see a test of 71317 levels, and resistance is now likely to be seen at 73060, a move above could see prices testing 73441.

Trading Ideas: 

* Silver trading range for the day is 71317-73441.

* Silver gained as U.S. Treasury yields pulled back, while investors awaited for key economic data this week that will shed light on the outlook for inflation.

* The United States is getting closer to the Fed’s maximum employment and 2% inflation goals, Fed Governor Lael Brainard said

* Data from the Institute for Supply Management showed factory activity in the country expanded at a slightly faster pace in May.

Crude oil

Crude oil yesterday settled up by 1.68% at 5026 amid optimism about increased energy demand, and on the decision of OPEC+ to gradually increase production. The Organization of the Petroleum Exporting Countries and its allies agreed to gradually ease supply curbs through July. Comments from Saudi Energy Minister Prince Abdulaziz bin Salman that he expects oil demand in the U.S. and China to see a significant recovery and the acceleration in vaccine rollouts will likely lead to a "further rebalancing of the global oil market," further supported oil prices. Reports that there will be a delay in supply from Iran contribute as well to the uptick in oil prices. According to an Iranian official, talks between Iran and world powers with regard to revival of a 2015 nuclear deal are likely to be finalized in August. Kazakhstan produced 6.240 million tonnes of oil in May, down 0.9% from April. According to calculations, the figure, which excludes gas condensate output, converts to 1.469 million barrels per day, which is slightly above the Central Asian nation's quota of 1.463 million bpd set under the global pact of OPEC and non-OPEC producers. Technically market is under fresh buying as market has witnessed gain in open interest by 26.48% to settled at 10392 while prices up 83 rupees, now Crude oil is getting support at 4974 and below same could see a test of 4922 levels, and resistance is now likely to be seen at 5059, a move above could see prices testing 5092.

Trading Ideas: 

* Crude oil trading range for the day is 4922-5092.

* Crude oil gained amid optimism about increased energy demand, and on the decision of OPEC+ to gradually increase production.

* The Organization of the Petroleum Exporting Countries and its allies agreed to gradually ease supply curbs through July.

* Saudi Energy Minister Prince Abdulaziz bin Salman said that he expects oil demand in the U.S. and China to see a significant recovery

Nat.Gas

Nat.Gas yesterday settled down by -2.02% at 223.2 on profit booking as weather was forecast to be warmer than previously expected over the next two weeks. In the power market, meanwhile, extreme heat in Northern California and other parts of the West boosted next-day prices for Wednesday to over $100 per megawatt hour at some hubs like the Mid-Columbia (Mid C) in the U.S. Pacific Northwest. Data provider Refinitiv said gas output in the Lower 48 U.S. states averaged 91.1 billion cubic feet per day (bcfd) so far in June, up from 91.0 bcfd in May but still well below the monthly record high of 95.4 bcfd in November 2019. With warmer weather coming, Refinitiv projected average gas demand, including exports, would rise from 84.3 bcfd this week to 89.3 bcfd next week. But those forecasts were lower than Refinitiv predicted on Tuesday, as higher gas prices prompt power generators to burn more coal and less gas to keep air conditioners humming. The amount of gas flowing to U.S. liquefied natural gas (LNG) export plants averaged 11.0 bcfd so far in June, up from 10.8 bcfd in May but below April's all-time high of 11.5 bcfd. Technically market is under long liquidation as market has witnessed drop in open interest by -18.16% to settled at 14165 while prices down -4.6 rupees, now Natural gas is getting support at 221.2 and below same could see a test of 219.3 levels, and resistance is now likely to be seen at 226.7, a move above could see prices testing 230.3.

Trading Ideas: 

* Natural gas trading range for the day is 219.3-230.3.

* Natural gas prices dropped on profit booking as weather was forecast to be warmer than previously expected over the next two weeks.

* Traders also noted that output was on track to decline at the same time soaring global gas prices pushed U.S. exports to near record highs.

* Data released by Baker Hughes showed, the total active U.S. rig count, including those drilling for natural gas, climbed by 2 to 457.

Copper

Copper yesterday settled down by -1.03% at 759.15 on profit booking amid worries about a dip in demand from top consumer China while a firmer dollar also sapped the metal’s appeal. The Yangshan copper premium fell to $28.50 a tonne, its lowest since February 2016, indicating weakening demand for imported metal into China as high copper prices deter downstream consumption. Supply threats from a looming election in Peru and strikes at BHP’s Escondida and Spence mines and Vale’s Sudbury mine have supported prices. Overall, projected higher demand for copper because of the global move towards a lower-carbon economy alongside an expected weak supply response is seen as the trigger for future prices to remain elevated. LME cash copper's discount to the three-month contract was at $10 a tonne, compared with a premium of $30.15 on April 23, pointing to easing supply concerns. Money managers cut their net long position for a third straight week to 33,991 contracts in the week to May 25. A deluge of new orders helped to drive a record increase in British manufacturing activity last month as the economy began to recover from the COVID-19 pandemic, a survey showed. Technically market is under fresh selling as market has witnessed gain in open interest by 10.99% to settled at 4231 while prices down -7.9 rupees, now Copper is getting support at 753.9 and below same could see a test of 748.5 levels, and resistance is now likely to be seen at 768, a move above could see prices testing 776.7.

Trading Ideas: 

* Copper trading range for the day is 748.5-776.7.

* Copper edged lower on profit booking amid worries about a dip in demand from top consumer China while a firmer dollar also weighed.

* The Yangshan copper premium fell to $28.50 a tonne, its lowest since February 2016, indicating weakening demand

* Funds whittled down their long positions in LME copper to 26% of open interest as of Friday, from 68% in February.

Zinc

Zinc yesterday settled up by 1.05% at 241.7 boosted by the manufacturing PMI of the US and China both recorded a new high, and LME inventories continued to decrease. However, zinc prices continued to be strong and the downstream market had poor willingness to restock, leading to the sluggish transaction. A deluge of new orders helped to drive a record increase in British manufacturing activity last month as the economy began to recover from the COVID-19 pandemic, a survey showed. The IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index (PMI) rose to 65.6 in May from 60.9 in April. While a little lower than the preliminary “flash” reading of 66.1, it still marked the highest since the survey started in 1992. The index levels represent the pace and breadth of growth rather than the amount of output, however, and the sector likely has some way to go to get back to where it was before the lockdown. The survey’s gauges of growth in new orders and employment also hit record highs, although so too did the measure of input cost inflation paid by factories for goods as they cited poor harvests, port disruption and Brexit. Technically market is under fresh buying as market has witnessed gain in open interest by 24.71% to settled at 2952 while prices up 2.5 rupees, now Zinc is getting support at 240.5 and below same could see a test of 239.2 levels, and resistance is now likely to be seen at 243, a move above could see prices testing 244.2.

Trading Ideas: 

* Zinc trading range for the day is 239.2-244.2.

* Zinc prices gained boosted by the manufacturing PMI of the US and China both recorded a new high, and LME inventories continued to decrease.

* However, zinc prices continued to be strong and the downstream market had poor willingness to restock, leading to the sluggish transaction.

* A deluge of new orders helped to drive a record increase in British manufacturing activity last month as the economy began to recover.

Nickel

Nickel yesterday settled up by 0.75% at 1334.1 as support seen after US manufacturing PMI in May was higher than expected. Data showed that the purchasing manager's index (PMI) for downstream nickel industries, including stainless steel, electroplating, alloy and battery, stood at 50.67 in May, up 0.76 point from April and returning to expansion. Factory activity in Japan and South Korea moderated in May, underscoring the fragile nature of their recoveries. Japan's au Jibun Bank PMI dropped in May as a global chip shortage and supply chain disruptions hit car production, causing output growth to miss expectations in April. The $6 trillion new infrastructure plan in the US ignited the enthusiasm of the capital market to speculate on commodity prices. Data showed that the purchasing manager's index (PMI) for downstream nickel industries, including stainless steel, electroplating, alloy and battery, stood at 50.67 in May, up 0.76 point from April and returning to expansion. The head of the Philippines’ Mines and Geosciences Bureau plans to lift an open-pit mining ban that has constrained nickel production in the country since 2017. Earlier, President Duterte lifted a moratorium on new mining agreements that had prevented investments in the country since 2012, in a bid to revitalize the industry. Technically market is under short covering as market has witnessed drop in open interest by -3.5% to settled at 1683 while prices up 9.9 rupees, now Nickel is getting support at 1325.5 and below same could see a test of 1316.9 levels, and resistance is now likely to be seen at 1343.2, a move above could see prices testing 1352.3.

Trading Ideas: 

* Nickel trading range for the day is 1316.9-1352.3.

* Nickel prices gained as support seen after US manufacturing PMI in May was higher than expected.

* The $6 trillion new infrastructure plan in the US ignited the enthusiasm of the capital market to speculate on commodity prices.

* Data showed that the purchasing manager's index (PMI) for downstream nickel industries, stood at 50.67 in May, up 0.76 point from April.

Aluminium

Aluminium yesterday settled down by -1.68% at 192.75 as the consumption declined in Guangdong and other regions under power rationing or in pandemic, and the social inventories in south China is expected to increase slightly. Yunnan’s aluminium plants under electricity curtailment have stopped the tanks. Before the shutdown, the molten aluminium has been taken out to cast ingots. The ingot arrivals in south China may be high in the short term. Aluminium stocks at three major Japanese ports rose 1.3% to 273,600 tonnes at the end of April, from 270,200 tonnes at the end of March. However, total stocks were down about 11.5% from the same month last year. US manufacturing PMI of May showed that manufacturing activities were stronger than expected, which boosted LME aluminium's rise. At the same time, shortages of raw materials and labour restricted production, and limited price growth. Global primary aluminium output fell to 5.56 million tonnes in April from revised 5.744 million tonnes in March, data from the International Aluminium Institute (IAI) showed. As the US new infrastructure plan will increase the supply shortage, overseas market is optimistic about the aluminium prices. Technically market is under long liquidation as market has witnessed drop in open interest by -9.21% to settled at 1953 while prices down -3.3 rupees, now Aluminium is getting support at 191.4 and below same could see a test of 190 levels, and resistance is now likely to be seen at 195.2, a move above could see prices testing 197.6.

Trading Ideas: 

* Aluminium trading range for the day is 190-197.6.

* Aluminium prices dropped as the consumption declined in Guangdong, and the social inventories in south China is expected to increase slightly.

* Aluminium stocks at three major Japanese ports rose 1.3% to 273,600 tonnes at the end of April, from 270,200 tonnes at the end of March.

* Global primary aluminium output fell to 5.56 million tonnes in April from revised 5.744 million tonnes in March, data from IAI showed.

Mentha oil

Mentha oil yesterday settled down by -0.3% at 912 as prices continues its weak trend as fresh season arrival started while the lock-down extension is impacting sentiments. As of now, daily arrival of fresh oil is relatively small (10-15 drums across Uttar Pradesh). Daily arrivals should gradually pick up to 400-500 drums in next 7-10 days. Overall post-lock-down demand will be likely to improve as demand from the health industry will likely continue also as per CIMAP (Central Institute of Medicinal and Aromatic Plants) Herbal products may boost immunity to avoid infection and demand for same has improved significantly since last year. Mentha exhibits important biological activities. For that reason, it has been used through the years as a remedy for respiratory diseases like bronchitis, sinusitis, tuberculosis, and the common cold. Due to favourable wheather condition,the production of mentha in the states has improved and is at much better terms compare to last year. Mentha has high demand in the production of cosmetics and confectionery goods but as it is not considered as necessity in present scenerio it is not much in demand. The COVID-19 outbreak has had a huge impact on the worldwide economy, and has posed a similar influence on the aroma chemicals market. In Sambhal spot market, Mentha oil dropped by -6.6 Rupees to end at 1017.3 Rupees per 360 kgs.Technically market is under long liquidation as market has witnessed drop in open interest by -21.62% to settled at 29 while prices down -2.7 rupees, now Mentha oil is getting support at 902.5 and below same could see a test of 892.9 levels, and resistance is now likely to be seen at 918.2, a move above could see prices testing 924.3.

Trading Ideas: 

* Mentha oil trading range for the day is 892.9-924.3.

* In Sambhal spot market, Mentha oil dropped  by -6.6 Rupees to end at 1017.3 Rupees per 360 kgs.

* Mentha oil prices continues its weak trend as fresh season arrival started while the lock-down extension is impacting sentiments.

* As of now, daily arrival of fresh oil is relatively small (10-15 drums across Uttar Pradesh).

* Daily arrivals should gradually pick up to 400-500 drums in next 7-10 days.

Soyabean

Soyabean yesterday settled up by 2.21% at 7061 after update late arrival of southwest monsoon rains in India may delay sowing of crops. Farmers generally wait for the monsoon to start before they begin planting food grains, cotton, soybeans, peanuts and sugarcane. Any deficit in rains during the early part of the season could delay sowing and reduce harvests, even if the monsoon gathers pace later. According to the third advance estimate, the total production of oilseeds in the country during 2020-21 is estimated to be a record 36.57 million tonnes which is 3.35 million tonnes more than the production of 33.22 million tonnes during 2019-20. In addition, the production of oilseeds during 2020-21 is 6.02 million tonnes more than the average oilseeds production of five years. The Russian government has reduced the country's export tax on soybeans to 20% from 30% starting from July 1, TASS news agency reported, citing the government. USDA report showed Soybean production in the world is likely to increase by 6% to 386 million tonnes in next season (September- 2021- August 2020) in expectation of higher crop size in US and India. Total crop size in India may stand higher by 750,000 tonnes to 11.2 Million tonnes against 10.45 Million tonnes in this season. At the Indore spot market in top producer MP, soybean gained 42 Rupees to 7268 Rupees per 100 kgs.Technically market is under short covering as market has witnessed drop in open interest by -7.33% to settled at 40965 while prices up 153 rupees, now Soyabean is getting support at 6919 and below same could see a test of 6777 levels, and resistance is now likely to be seen at 7149, a move above could see prices testing 7237.

Trading Ideas: 

* Soyabean trading range for the day is 6777-7237.

* Soyabean gains as support seen after update late arrival of southwest monsoon rains in India may delay sowing of crops

* Farmers generally wait for the monsoon to start before they begin planting soybeans.

* According to the third advance estimate, the total production of oilseeds in the country during 2020-21 is estimated to be a record 36.57 million tonnes

* At the Indore spot market in top producer MP, soybean gained  42 Rupees to 7268 Rupees per 100 kgs.

Ref.Soyaoil

Ref.Soyaoil yesterday settled up by 0.78% at 1415.4 after reports that the industry has said any reduction in import duty should be done after kharif oilseed planting is over so that no negative signal goes out to oilseed farmers. Higher soybean output could limit edible oil imports. Indian farmers are likely to expand their soybean planting area by more than a tenth in 2021 as record high prices for the oilseed could prompt some to switch from cultivating competing commodities such as cotton and pulses, industry officials said. Increased production of India's main summer-sown oilseed could help the world's biggest vegetable oil importer trim costly purchases of palm oil, soyoil and sunflower oil from Indonesia, Malaysia, Argentina and Ukraine. Global oilseed production is forecast to grow 5 percent in 2021/22, primarily on growth in soybean output in the United States and South America. Global oilseed production is projected to reach 632 million tons on record plantings. Soybean production is forecast to rise 23 million tons to 386 million, a 6-percent increase. Edible Oil industry cautioned the government against resorting to any knee-jerk reaction of lowering import duties to cool down domestic prices, saying it could have a 'very negative’ impact on oilseed farmers, kharif planting for which will start in the coming few weeks. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1417.05 Rupees per 10 kgs.Technically market is under short covering as market has witnessed drop in open interest by -4.95% to settled at 30835 while prices up 10.9 rupees, now Ref.Soya oil is getting support at 1402 and below same could see a test of 1388 levels, and resistance is now likely to be seen at 1424, a move above could see prices testing 1432.

Trading Ideas: 

* Ref.Soya oil trading range for the day is 1388-1432.

* Refined soyoil prices gained after reports that reduction in import duty for edible oil should be postponed.

* Indian farmers are likely to expand their soybean planting area by more than a tenth in 2021

* Edible Oil industry cautioned the government against resorting to any knee-jerk reaction of lowering import duties to cool down domestic prices

* At the Indore spot market in Madhya Pradesh, soyoil was steady at 1417.05 Rupees per 10 kgs.

Crude palm Oil

Crude palm Oil yesterday settled up by 0.55% at 1147.4 underpinned by concerns over supply of rival edible oils, but a fresh coronavirus lockdown in Malaysia and a slow rise in May exports hurt demand outlook. The world's second largest producer of the edible oil prepared for a two-week nationwide lockdown due to a spike in new coronavirus infections. Malaysia will commence a two-week nationwide lockdown starting Tuesday that will see the closure of non-essential businesses and services to control the pandemic. Palm oil plantations will be allowed to operate while manufacturing sector are allowed to operate with reduced capacity. China has approved trading of crude oil and palm oil options on the Shanghai International Energy Exchange and the Dalian Commodity Exchange respectively, its securities regulator said, adding to a range of products open to foreign participants for trading. Market expects an increase in production and hit by demand and lockdown concerns in Malaysia. There are also concerns of stricter movement restrictions in Malaysia, which could implode consumption from the domestic hospitality, restaurants and catering sectors. Malaysia has kept its May export tax for crude palm oil at 8% but raised the reference price, a circular on the Malaysian Palm Oil Board website showed. In spot market, Crude palm oil gained by 8.7 Rupees to end at 1164 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -1.57% to settled at 6150 while prices up 6.3 rupees, now CPO is getting support at 1136.7 and below same could see a test of 1126 levels, and resistance is now likely to be seen at 1154.4, a move above could see prices testing 1161.4.

Trading Ideas: 

* CPO trading range for the day is 1126-1161.4.

* Crude palm oil gained underpinned by concerns over supply of rival edible oils

* Palm oil plantations will be allowed to operate while manufacturing sector are allowed to operate with reduced capacity.

* Market expects an increase in production and hit by demand and lockdown concerns in Malaysia.

* In spot market, Crude palm oil gained  by 8.7 Rupees to end at 1164 Rupees.

Mustard Seed

Mustard Seed yesterday settled up by 0.74% at 7123 as support seen after COOIT was against any reduction in import duties on edible oils but wanted the Centre to remove the GST of 5 per cent on mustard seed and oil as it will help farmers and consumers both. The decision to ban the adulteration of mustard oil from June 8, the demand for soybean degum and palmolein has weakened. Due to this, the prices of these imported oils are also very soft. The ban on adulteration of edible oils would be beneficial for both domestic consumers and producers. While oil without adulteration will be available, its production will increase in the country. According to sources, the arrival of mustard in the mandis has decreased at all places in the country. The daily arrival of mustard was 15-20 thousand bags in Najafgarh Mandi, Delhi. It was reduced from 500 to 600 bags. U.S. rapeseed production is forecast to reach a record 1.8 million tons on record area and trend yield. Canada rapeseed production is projected at 20.5 million tons, up 1.5 million on greater area. European Union rapeseed production is projected to show a modest gain in 2021/22 on increased planted area and improved yield but will remain below the levels observed from 2016 to 2018. In Alwar spot market in Rajasthan the prices gained 105 Rupees to end at 7325 Rupees per 100 kg.Technically market is under short covering as market has witnessed drop in open interest by -7.04% to settled at 38560 while prices up 52 rupees, now Rmseed is getting support at 7072 and below same could see a test of 7022 levels, and resistance is now likely to be seen at 7160, a move above could see prices testing 7198.

Trading Ideas: 

* Rmseed trading range for the day is 7022-7198.

* Mustard seed gains as support seen after COOIT was against any reduction in import duties on edible oils 

* The decision to ban the adulteration of mustard oil from June 8, the demand for soybean degum and palmolein has weakened.

* U.S. rapeseed production is forecast to reach a record 1.8 million tons on record area and trend yield.

* In Alwar spot market in Rajasthan the prices gained 105 Rupees to end at 7325 Rupees per 100 kg.

Turmeric

Turmeric yesterday settled down by -0.39% at 7724 as the curbs and lockdowns announced to control the second wave of Covid-19 pandemic affected trading. However downside seen limited on following export demand from Europe, Gulf countries and Bangladesh. In Nizamabad APMC in Telangana, the modal price of the finger variety turmeric was quoted at ₹6,950 a quintal. Prices are up about ₹400 since the beginning of this month. At Bangalore in Karnataka, turmeric is quoted at ₹11,500 at the APMC yard with most markets closed in the State to control the Covid-19 pandemic. In Tamil Nadu, too, the agricultural markets are closed as part of the lockdown to tackle the pandemic. Demand for exports to Bangladesh and Europe are helping turmeric prices to gain. Exporters are looking to pick up stocks from Nanded in view of its quality. Turmeric has been in demand over the last two years as it is reported to be effective in medical use, particularly in combating Covid-19. According to Spices Board data, turmeric exports during the April-December period of the last fiscal increased 34 per cent to 1.39 lakh tonnes valued at ₹1,251 crore compared with 1.03 lakh tonnes valued at ₹1,047 crore. In Nizamabad, a major spot market in AP, the price ended at 7586.85 Rupees dropped -16.1 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -4.79% to settled at 8245 while prices down -30 rupees, now Turmeric is getting support at 7682 and below same could see a test of 7640 levels, and resistance is now likely to be seen at 7766, a move above could see prices testing 7808.

Trading Ideas: 

* Turmeric trading range for the day is 7640-7808.

* Turmeric prices dropped as the curbs and lockdowns announced to control the second wave of Covid-19 pandemic affected trading.

* However downside seen limited on following export demand from Europe, Gulf countries and Bangladesh.

* At least 50 per cent of the crop cultivated in the Maharashtra growing regions are estimated to have arrived at the terminal agricultural markets.

* In Nizamabad, a major spot market in AP, the price ended at 7586.85 Rupees dropped -16.1 Rupees.

Jeera

Jeera yesterday settled flat as lockdown restrictions increased against rising Covid cases, slowing spot trade interest weakened market sentiments and pushed prices lower. The wholesale offers for the NCDEX grade Jeera are currently offered around Rs.14000/qtl in Unjha and in Jodhpur, the mandi offers average near Rs.13900/qtl. Over a month, the wholesale prices in Unjha and Jodhpur have gone down by Rs.400/qtl and Rs.700/qtl respectively. As India struggles against curbing the Corona pandemic, exports markets have turned subdued. The importers prefer to wait for the situation to normalize before negotiating for fresh deals. They rather prefer to clear their older stocks first and presently they feel that the older inventory may be sufficient to balance the existing demand for next few weeks easily. The new season arrivals shall continue with good numbers hence there will be ample availability in the market. However from a broader perspective, India’s exports outlook has brightened while crop is expected to be lower versus year on year. Also, the nearest export competitors i.e. Turkey and Syria may not supply much to the world due to lower exportable surplus. In Unjha, a key spot market in Gujarat, jeera edged down by -94.3 Rupees to end at 13820 Rupees per 100 kg.Technically market is under long liquidation as market has witnessed drop in open interest by -2.23% to settled at 5394 while prices remain unchanged 0 rupees, now Jeera is getting support at 13650 and below same could see a test of 13590 levels, and resistance is now likely to be seen at 13760, a move above could see prices testing 13810.

Trading Ideas: 

* Jeera trading range for the day is 13590-13810.

* Jeera prices traded in range as lockdown restrictions increased against rising Covid cases

* As India struggles against curbing the Corona pandemic, exports markets have turned subdued.

* The importers prefer to wait for the situation to normalize before negotiating for fresh deals.

* In Unjha, a key spot market in Gujarat, jeera edged down by -94.3 Rupees to end at 13820 Rupees per 100 kg.

Cotton

Cotton yesterday settled up by 0.08% at 23730 paring gains seen earlier as sowing of cotton may be delayed in India as the southwest monsoon, is set to reach the mainland two days later than usual. Cotton Cooperation of India has increased prices by 200-500 Rs Candy across all growths of all Zones for 2020-21 season and for 2019-20 season. Cotton crop is at risk due to water shortage in Sindh and Punjab. The increasing trend in the rate of cotton remained continued in international markets. Agriculture Minster Punjab Hussain Jahanian Gardezi said that Punjab is facing water shortage of 22 % while Sindh is facing shortage of around 17%.According to the Third Advance Estimate released by the government, cotton production is estimated at 36.49 million bales higher by 4.59 million bales than the average cotton production. In the previous season 2019-20 cotton production was estimated at 36.07 million bales. The U.S. Department of Agriculture's (USDA) weekly export sales report showed net sales of 171,200 Running Bales for the 2020/2021 marking year, 59% higher than the prior week. CAI has revised higher Indian cotton export estimates for 2020-21 season at 65 lakh bales against 60 lakh bales projected till last month. Cotton production in Haryana is expected to decline by 27 percent to 1.8 million bales in 2020-21 (July-June) season due to yield loss. In spot market, Cotton gained by 150 Rupees to end at 23650 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 0.28% to settled at 7288 while prices up 20 rupees, now Cotton is getting support at 23610 and below same could see a test of 23500 levels, and resistance is now likely to be seen at 23830, a move above could see prices testing 23940.

Trading Ideas: 

* Cotton trading range for the day is 23500-23940.

* Cotton settled flat paring gains seen earlier as sowing of cotton may be delayed in India

* The country’s cotton exports are likely to be 20 percent higher at 1.02 million tonnes in 2020-21.

* Cotton crop is at risk due to water shortage in Sindh and Punjab.

* In spot market, Cotton gained  by 150 Rupees to end at 23650 Rupees.

Chana

Chana yesterday settled up by 0.36% at 5259 as India’s supply of Kabuli chickpea is expected to plunge 32 percent to 396,000 tonnes due to low carryout and very poor production prospects for all of India’s rabi (winter) season crops. Exports will fall to an estimated 50,000 tonnes, down from 115,000 tonnes each of the previous two years. The situation is so dire that India is expected to import 50,000 tonnes from Canada, Argentina and Turkey. Even with that injection of supplies, India will end the year with 36,000 tonnes of kabulis, which is a far cry from the 200,000 tonnes it needs to balance supply and demand the following year. According to the latest forecast of the Ministry of Agriculture of India, the forecast for lentils production estimate has been decreased from 13.50 to 12.60 lakh MT. Govt increased Bengal Gram production by 10 lakh MT to 126.1 lakh MT. For tur, it is 41.40 lakh MT, Urad at23.70 lakh MT, Masur at 12.60 lakh MT, Masur production estimate has been decreased from 13.50 to 12.60 lakh MT. Trades are of the view that Bengal Gram production estimate is very optimistic. In Delhi spot market, chana dropped by -34.35 Rupees to end at 5213.65 Rupees per 100 kgs.Technically market is under short covering as market has witnessed drop in open interest by -2.44% to settled at 86480 while prices up 19 rupees, now Chana is getting support at 5222 and below same could see a test of 5186 levels, and resistance is now likely to be seen at 5283, a move above could see prices testing 5308.

Trading Ideas: 

* Chana trading range for the day is 5186-5308.

* Chana prices seen supported as India’s supply of Kabuli chickpea is expected to plunge 32 percent 

* Even with that injection of supplies, India will end the year with 36,000 tonnes of kabulis, which is a far cry from the 200,000 tonnes it needs

* Govt. raised Bengal Gram production estimate by 10 lakh mt to 12.61 lakh mt for 2020-21

* In Delhi spot market, chana dropped  by -34.35 Rupees to end at 5213.65 Rupees per 100 kgs.

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer