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Gold

Gold prices settled higher by 0.75% at Rs.86,026, driven by escalating geopolitical tensions and a sharp decline in the U.S. dollar index. The imposition of U.S. trade tariffs on Mexico, Canada, and China, which affected $1 trillion in global commerce, contributed to market uncertainty, boosting gold’s safe-haven appeal. Additionally, the latest U.S. ISM Manufacturing PMI remained stable at 50.0 in February, slightly lower than expectations. However, a sharp rise in the Price Index to 62.4 from January’s 54.9 indicated renewed inflationary pressures. This has increased expectations that the Federal Reserve may initiate interest rate cuts in June and September, further supporting bullion’s attractiveness as a non-yielding asset. India’s gold demand improved slightly in the latter half of the month but remained below normal levels due to price corrections from all-time highs. Despite this, traders in China continued offering discounts amid weak activity, with Indian dealers providing discounts of $12-$27 per ounce, lower than the previous week's $35. India's gold imports in February are expected to plummet by 85% year-on-year, hitting a 20-year low. Technically, the market is under fresh buying as open interest increased by 3.13% to 14,327 contracts, alongside a price gain of Rs.642. Gold finds support at Rs.85,460, with further downside potential towards Rs.84,900. On the upside, resistance is at Rs.86,455, and a breakout above could push prices to Rs.86,890.
 

Trading Ideas:
* Gold trading range for the day is 84900-86890.
* Gold gains due to elevated geopolitical tensions and amid a sharp drop in the U.S. dollar index.
* U.S. trade tariffs against Mexico, Canada and China went into effect Tuesday, with the targeted countries already retaliating.
* Fed could restart cuts to short-term borrowing rates in June and follow up with another reduction in September.


Silver
Silver prices settled 0.21% higher at Rs.96,256 amid concerns over slowing economic growth and trade tariff impacts on the U.S. economy. The newly imposed 25% U.S. tariffs on Mexican and Canadian goods, along with a doubling of duties on Chinese imports to 20%, have triggered retaliatory actions from China, Canada, and Mexico, adding to market uncertainties. Despite these concerns, silver inventories at Comex (New York) have surged to a record high of 403.2 million ounces, reflecting increased availability. However, demand remains mixed - Hecla Mining reported a 13% rise in silver output for 2024, producing 16.2 million ounces, but U.S. silver coin purchases declined 27% year-over-year in January to 3.5 million ounces, the lowest January demand since 2018. Looking ahead, silver's industrial demand remains strong, expected to grow by 3% in 2025, surpassing 700 million ounces for the first time. While retail investment is also forecast to rise, jewelry demand is set to drop by 6%, mainly due to weaker demand in India caused by high local prices. Global silver supply is projected to reach an 11-year high of 1.05 billion ounces, with mine production rising 2% to 844 million ounces and recycling growing 5% to over 200 million ounces. Technically, silver is under fresh buying pressure, with open interest rising slightly by 0.05% to 19,182 contracts while prices increased by Rs.201. Support is at Rs.95,555, with further downside potential to Rs.94,860. On the upside, resistance is seen at Rs.96,820, and a breakout could push prices to Rs.97,390.
 

Trading Ideas:
* Silver trading range for the day is 94860-97390.
* Silver steadied amid concerns about slowing growth and the impact from tariffs on the U.S. economy.
* China said it will impose additional tariffs of 10-15% on certain U.S. imports from March 10.
* Silver inventories at Comex (New York) have risen to a record high as the metal pushes prices month-over-month.


Crude Oil
Crude oil prices settled 0.48% lower at Rs.5,960, pressured by reports that OPEC+ will proceed with a planned output increase in April and the impact of newly imposed U.S. tariffs on Canada, Mexico, and China, along with Beijing’s retaliatory measures. OPEC+ has decided to raise oil production by 138,000 barrels per day, marking its first output increase since 2022. Market sentiment was further weighed down by speculation that the U.S. could ease sanctions on Russia following a halt in military aid to Ukraine, potentially increasing global oil supply. Goldman Sachs has highlighted downside risks to its Brent crude price forecasts of $78 per barrel for 2025 and $73 for 2026 due to OPEC+ supply increases and softer U.S. economic activity. The EIA reported a U.S. crude inventory drop of 2.332 million barrels for the week ending February 21, against expectations of a 2.54 million-barrel build. However, Cushing, Oklahoma stockpiles rose by 1.282 million barrels, while gasoline inventories increased by 0.369 million barrels. Distillate stockpiles saw a significant rise of 3.908 million barrels, the largest in seven weeks. The U.S. Energy Information Administration (EIA) projects U.S. crude oil production to hit 13.59 million barrels per day in 2025, slightly higher than previous estimates. Technically, crude oil is under fresh selling pressure, with open interest surging by 23.47% to 6,413 contracts while prices declined Rs.29. Support is seen at Rs.5,874, with further downside potential to Rs.5,787, while resistance is at Rs.6,015, and a breakout above could push prices to Rs.6,069.
 

Trading Ideas:
* Crudeoil trading range for the day is 5787-6069.
* Crude oil dropped following reports that OPEC+ will proceed with a planned output increase in April
* U.S. tariffs on Canada, Mexico and China came into effect, as well as Beijing's retaliatory tariffs.
* Further weighing on oil was Trump's halt of military aid to Ukraine.


Natural Gas
Natural gas prices surged by 9.1% to Rs.387.3, driven by record flows to LNG export facilities and higher-than-expected demand forecasts for next week. This sharp rise occurred despite near-record output and mild weather projections through mid-March, which should typically limit storage withdrawals. U.S. natural gas production in the Lower 48 states has averaged 105.6 bcfd in March, surpassing the February record of 104.7 bcfd. However, output has seen a recent decline, dropping to 104.7 bcfd on Tuesday from a three-week high of 106.5 bcfd on February 28. Weather forecasts indicate that temperatures across the Lower 48 states will remain above normal until March 19. As a result, gas demand, including exports, is expected to fall from 118.8 bcfd this week to 115.2 bcfd next week. Storage withdrawals remain strong, with U.S. utilities pulling 261 bcf from storage for the week ending February 21, reducing total inventories to 1,840 bcf. Current storage levels are now 23.4% lower than a year ago and 11.5% below the five-year average. The EIA projects record U.S. natural gas output and demand in 2025, with dry gas production expected to rise to 104.6 bcfd and LNG exports reaching 14.0 bcfd. Technically, natural gas is under fresh buying pressure, with open interest increasing by 36.72% to 23,150 contracts while prices rose by Rs.32.3. Support is seen at Rs.361.6, with a further downside to Rs.335.9, while resistance is at Rs.405.2, with an upside target of Rs.423.1.
 

Trading Ideas:
* Naturalgas trading range for the day is 335.9-423.1.
* Natural gas jumped on record flows to LNG export plants and forecasts for higher demand.
* US gas output on track to hit record high in March
* US LNG export feedgas on track to match February's record high


Copper
Copper prices declined by 0.46% to Rs.862.1, weighed down by uncertainty regarding potential U.S. tariffs on the metal. Former U.S. President Donald Trump had initiated a probe into imposing tariffs on copper imports to boost domestic production, which remains limited due to only two major smelters. With the U.S. importing nearly half of its copper needs, such tariffs could lead to tighter supplies. Meanwhile, treatment charges for Chinese smelters remained negative, signaling overcapacity in refined copper production, even as copper stocks in China surged toward 270,000 metric tons - three times higher than at the beginning of the year. Chile, the world’s top copper producer, reported a 2.1% year-on-year decline in copper output for January, reaching 426,889 metric tons. The global refined copper market saw a reduced deficit of 22,000 metric tons in December, compared to 124,000 metric tons in November, according to the International Copper Study Group (ICSG). Over the entire year, the market was in a surplus of 301,000 metric tons, contrasting with a 52,000 metric ton deficit the previous year. China's refined copper production for December rose 4.3% year-on-year to 1.24 million metric tons, while copper imports increased by 17.8% to 559,000 metric tons. Technically, the copper market is experiencing long liquidation, with open interest dropping by 1.55% to 6,308 contracts, alongside a Rs.3.95 price decline. Copper has support at Rs.859.6, with a potential downside to Rs.857.1, while resistance is at Rs.865.1, and a breakout above could lead to Rs.868.1.
 

Trading Ideas:
* Copper trading range for the day is 857.1-868.1.
* Copper dropped due to ongoing uncertainty surrounding potential US tariffs on the metal.
* Treatment charges for Chinese smelters remained negative, indicating significant overcapacity in refined copper production.
* Copper stocks in China have surged toward the 270,000-tonne mark, three times the level seen at the start of the year.


Zinc
Zinc prices declined by 0.61% to Rs.268.4 amid heightened trade tensions as the U.S. imposed new tariffs on China, Canada, and Mexico, raising concerns over global economic growth. China retaliated by increasing levies on American agricultural and food products, intensifying fears of a prolonged trade war. Meanwhile, the People's Bank of China (PBoC) signaled possible policy adjustments to support the economy, citing weak domestic demand and external pressures. On the supply side, global mined zinc production declined for the third consecutive year in 2024, reflecting a 7% drop in refined zinc output from China. The impending slowdown at Alaska’s Red Dog Mine, which accounts for 10% of global supply, further adds to supply constraints in 2025. The International Lead and Zinc Study Group (ILZSG) reported that the global zinc market moved into a 62,000-ton deficit in 2024, reversing a surplus of 310,000 tons from the previous year. Lower production in China, Japan, and South Korea drove refined zinc production down by 2.6%, while mine production fell 2.8% due to declines in Canada, China, South Africa, and Peru. Despite this, global demand for refined zinc metal remained stable at 13.6 million tons, as reductions in China, Europe, and the U.S. were offset by increased consumption in Brazil, India, and South Korea. Technically, the market witnessed long liquidation with open interest falling by 5.22% to 2,213 contracts. Zinc has immediate support at Rs.267.2, with a break below potentially testing Rs.265.8. Resistance is at Rs.270, and a move above could see prices reaching Rs.271.4.
 

Trading Ideas:
* Zinc trading range for the day is 265.8-271.4.
* Zinc dropped as U.S. President Donald Trump slapped tariffs on China, Canada and Mexico.
* China's manufacturing activity returned to expansion in February.
* Spotlight will be on China's National People's Congress meeting scheduled for March 5 to see if the country unveils more stimulus.


Aluminium
Aluminium prices remained unchanged at Rs.258.55 as market sentiment was influenced by the U.S. signaling a potential relaxation of sanctions on Russia. This move eased concerns over supply disruptions, boosting expectations that Russian aluminium giant Rusal could regain access to international markets. On the production front, China’s aluminium output reached a record 44 million metric tons in 2024, but future output is expected to slow as Beijing enforces production caps aimed at controlling excess supply and reducing carbon emissions. The resumption of aluminium production in China, with domestic operating capacity rising gradually in February, also added to supply pressure. Global primary aluminium output in January increased by 2.7% year-on-year to 6.252 million tonnes, according to the International Aluminium Institute (IAI). Meanwhile, China's exports of unwrought aluminium and aluminium products surged by 17% in the first ten months of 2024, totaling nearly 5.5 million tons. Despite higher production, rising costs have squeezed profit margins for Chinese aluminium producers, leading to average losses of 687 yuan per ton, marking the first industry-wide losses in three years, according to Antaike. Technically, the market witnessed fresh selling with a 2.06% rise in open interest to 3,321 contracts. Aluminium has immediate support at 257.8, with a break below potentially testing Rs.257.1. On the upside, resistance is at Rs.259, and a move above this level could push prices toward Rs.259.5.
 

Trading Ideas:
* Aluminium trading range for the day is 257.1-259.5.
* Aluminium fell as signals from the US that it aims to relax sanctions of Russia eased growing concerns of low supply.
* Pressure also seen amid resumption of aluminium production in China.
* China produced 44 million tons of aluminum in 2024, the most on record


Cottoncandy
Cottoncandy prices declined by 1.63% to Rs.52,520 due to increased supply and subdued mill buying, as mills remain well-stocked and are not facing immediate purchasing needs. The cotton supply has surged, driven by Brazil’s projected 1.6% increase in 2024-25 cotton production to 3.76 million tons, along with a 4.8% expansion in planting area. Additionally, CCI is expected to procure over 100 lakh bales at the Minimum Support Price (MSP) this season. The Cotton Association of India (CAI) has estimated the 2024-25 cotton output to drop to 301.75 lakh bales, down from 327.45 lakh bales in the previous season, primarily due to lower yields in Gujarat and northern regions. However, the quality of cotton remains strong. By the end of January 2025, total cotton supply was estimated at 234.26 lakh bales, comprising 188.07 lakh bales of fresh pressings, 16 lakh bales of imports, and an opening stock of 30.19 lakh bales. Consumption up to January stood at 114 lakh bales, with exports at 8 lakh bales. End-of-January stocks were at 112.26 lakh bales, including 27 lakh bales with textile mills and the rest with CCI, traders, and exporters. Technically, the market is under long liquidation, with open interest remaining unchanged at 251 contracts. Prices dropped by Rs.870, and Cottoncandy has support at Rs.52,170, with a break below potentially testing Rs.51,810. Resistance is at Rs.53,030, and a move above could push prices to Rs.53,530.
 

Trading Ideas:
* Cottoncandy trading range for the day is 51810-53530.
* Cotton dropped due to a substantial increase in supply and limited mill buying.
* CCI is likely to buy more than 100 lakh bales of cotton at MSP during the current cotton year.
* CAI the overall cotton output is estimated to dip to 301.75 lakh bales due to lower yield in Gujarat and the northern region.
* In Rajkot, a major spot market, the price ended at 25357.2 Rupees dropped by -0.38 percent.


Turmeric
Turmeric prices declined by 0.76% to settle at 12,198 as the arrival of the new crop commenced. Despite an increase in the cultivated area by 10% to 3.30 lakh hectares compared to the previous season’s 3 lakh hectares, untimely rains have raised concerns about productivity. Production is expected to remain near last year’s 10.75 lakh tonnes, with a potential fluctuation of 3-5%. The Nanded region, a key turmeric-producing area, is witnessing a 10-15% decline in yield due to smaller rhizomes and crop rot. However, the extent of production loss will become clearer as harvesting progresses. On the demand side, turmeric exports between April and November 2024 rose by 9.8% to 121,601.21 tonnes compared to 110,745.34 tonnes in the same period of 2023. However, monthly exports fell by 20.18% in November compared to October. Notably, November 2024 exports were still 48.22% higher year-on-year. On the import front, turmeric imports surged by 101.8% in the April-November 2024 period, reaching 18,937.95 tonnes compared to 9,384.42 tonnes a year earlier. However, November imports dropped by 34.84% compared to October. Technically, the market is under long liquidation, with open interest declining by 0.16% to 12,680 contracts. Prices fell by 94 rupees, with key support at 12,118, below which a test of 12,036 is possible. On the upside, resistance is seen at 12,314, and a breakout could push prices towards 12,428.
 

Trading Ideas:
* Turmeric trading range for the day is 12036-12428.
* Turmeric prices dropped as arrival of new turmeric crop has started.
* New turmeric crop is arriving in Nizamabad and Hingoli Mandi.
* However downside seen limited as new crop yields are expected to be 10-15% lower this year.
* In Nizamabad, a major spot market, the price ended at 12648.75 Rupees dropped by -1.57 percent.


Jeera
Jeera prices rose by 0.9% to settle at 21,335, driven by supply concerns as the new crop in Gujarat has been delayed by about a month due to unfavorable weather. Sowing in key producing states like Gujarat and Rajasthan was also delayed by the same period. However, upside momentum remains limited as domestic demand is subdued, and current export demand is being met through available stock. Farmers still hold approximately 20 lakh bags of jeera, with only 3-4 lakh bags expected to be traded before the season ends, leaving a significant carry-forward stock of around 16 lakh bags. Production levels for this season are expected to be similar to last year, with improved crop conditions and good sowing. According to the Spices Board, India’s cumin production increased to 8.6 lakh tonnes in 2023-24, compared to 5.77 lakh tonnes in the previous year. Despite this, India's cumin remains the most affordable in global markets, making it the preferred choice for buyers, including China. Indian cumin is priced at $3,050 per tonne, while Chinese cumin is $200-$250 more expensive. Jeera exports saw a strong increase, rising 74.04% to 147,006.20 tonnes in Apr-Nov 2024 compared to 84,467.16 tonnes a year earlier. However, November exports declined by 28.92% from October. Technically, the market is under short covering, with open interest dropping by 3.08% to 2,454 contracts while prices gained 190 rupees. Jeera finds support at 21,120, with a break below potentially testing 20,910. Resistance is at 21,480, and a move above could push prices toward 21,630.
 

Trading Ideas:
* Jeera trading range for the day is 20910-21630.
* Jeera gains as the start of the new crop of cumin in Gujarat has been delayed by about a month.
* The current season is expected to have similar production levels as last year due to better crop conditions.
* However upside seen limited as demand is low and the current export business is being met from the available stock.
* In Unjha, a major spot market, the price ended at 21094.85 Rupees gained by 0.02 percent.

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