Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities

Content
News & Market Highlights Chana Sugar Oilseed Complex Spices Complex Kapas/Cotton

Research Team
Vedika Narvekar - Sr. Research Analyst vedika.narvekar@angelbroking.com (022) 2921 2000 Extn. 6130 Anuj Choudhary - Research Analyst anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132

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Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities
News in brief
Govt likely to give GST outline in Budget
Finance Minister P Chidambaram is set to announce a broad outline of the Goods & Services Tax (GST) in Budget 201314, after putting his stamp of approval on states major decisions at a meeting on Thursday. The meet will be crucial as other indirect tax proposals for the Budget, such as service tax and excise duty rates, exemptions and credit rules are likely to be framed keeping in mind the road map for GST. Ahead of the Budget session of Parliament, the minister would seek formal approval of the empowered committee of state finance ministers on the design of GST proposed last month in Bhubaneswar by a panel of Centre and state officers. The states had broadly agreed to make GST optional, provide a floor rate with a narrow band, and do away with the dispute resolution panel, among other things. These decisions would require further changes to the Constitution Amendment Bill being vetted by Parliaments standing committee on finance. The Centre and states might agree on giving the former one- third and the latter two- third weightage in the GST Council for taking decisions with a 75 per cent majority. The existing Bill says decisions would be taken by consensus. After sealing the deal with states on February 14, Chidambaram might recommend the changes to the Parliament panel, so that the Bill could be pushed for consideration and passage. (Source: Business Standard)

Market Highlights (% change)

Last Prev. day

as on Feb 8, 2013
WoW MoM YoY

Sensex Nifty INR/$ Nymex Crude Oil - $/bbl Comex Gold - $/oz

19485 5904 53.6 95.72 1666

-0.49 -0.59 0.70 -0.11 -0.26

-1.50 -1.59 0.80 -2.10 -0.20

-1.31 -1.64 -2.49 2.76 0.27

10.04 9.97 9.21 -3.03 -3.66

.Source: Reuters

Seed exports may double in next 2-3 years

Export of agri-seeds from the country may more than double to Rs 1,000 crore in the next 2-3 years as 38 varieties from India have been registered in the OECD list, industry body National Seed Association (NSAI) said on Sunday. The listing of Indian seeds with the Organisation for Economic Co-operation and Development (OECD), a group of 34 countries, guarantees the quality of seeds that can be imported by countries participating in the OECD Seed Schemes. About 57 nations are registered in such seed schemes. Seed export is expected to rise to Rs 1,000 crore in the next 2-3 years as for the first time 38 Indian private seed varieties have been registered in the OECD list, Executive Director of NSAI, Raju Kapoor said. (Source: Business Line)

Sugar prices may go up Rs 2/kg after April: ICRA

Sugar prices may rise by Rs 2 per kg after April on supply constraints in the wake of expected fall in domestic output of the sweetener, rating agency ICRA has said. While sugar mills are likely to benefit from steady sugar and by-product realisation, growth in cane prices will impact profits of sugar mills adversely in the ongoing 2012-13 marketing year (OctoberSeptember), it noted. Pegging countrys overall sugar output at 23-24 million tonnes and consumption at close to 23.5 million tonnes for this year, ICRA said that domestic prices could firm up due to supply pressure in the second half of this year as extra stocks would be 6 million tonnes sufficient to meet three months demand. (Source: Business Line)

Global coffee exports at 113 mn bags in 2012

Global coffee exports rose by 8.2 per cent to a record 113 million bags in 2012 due to higher demand even as shipments from India declined during the year, according to International Coffee Organisation (ICO). World Coffee exports were to the tune of 104.57 million bags in 2011. One bag contains 60 kg of beans. Indias coffee exports fell by 9.4% to 5.28 million bags in 2012. Total exports in calendar year 2012 reached a record 113.1 million bags, 8.2% higher than 2011, and predominantly fuelled by a high volume of robusta shipments, ICO said in its report. The strong export levels seen over the last couple of years have also led to a reduction in opening stocks in exporting countries. At the beginning of current crop year, total opening stocks were 15.3 million bags, compared to 18.2 million in the previous year, it said. (Source: Business Line)

Onion prices set to soften soon

Consumers shedding tears over onion prices that have quadrupled in the last six months can heave a sigh of relief. Prices are set to decline soon. Changdev Holkar, Board member of the National Agricultural Cooperative Marketing Federation, is of the view that prices will ease as soon as the rabi onion crop, which was planted in October, arrives in the market, in early April. Supplies from States such as Madhya Pradesh, Gujarat and Rajasthan are also improving, he said, adding that these would help cool prices. Currently, the market is facing a shortage because kharif and late-kharif crop got affected due to the poor rain in June and July There was not enough water for a good yield. There is almost a 30% decline in kharif and late kharif production. Plus, kharif onion does not have a long shelf life, Holkar said. In the last six months, onion prices have soared to Rs 1,700-2,000 a quintal from Rs 500-600 at Lasalgaon market in Nashik district of Maharashtra. (Source: Business Line)

Nod to Ship Coconut Oil from all Ports to Boost Exports

Coconut oil exports from India are all set to surge with the Centre permitting shipments through all ports and the Coconut Development Board (CDB) accelerating its efforts to woo new exporters to enter the fray. India, which currently exports 8,441 tonne, accounts for 0.33% of the total 25 lakh tonne coconut oil export dominated by the Philippines, Indonesia and Papua New Guinea. CDB Chairman TK Jose said the board will take an initiative to raise coconut oil exports to 1.5 lakh tn in the oil year stretching from September 2012 to October 2013. Companies in Kerala are expected to contribute 50,000 tn to this target while the other states led by Tamil Nadu could mop up the rest. (Source: Economic Times)

A Higher Excise Duty May Follow Sugar Decontrol

The Centre may raise the excise duty on sugar output and levy a moderate export duty if it decides to lift controls on the commodity. This will help the Union government to reduce the financial burden of selling sugar at subsidised rates to poor families after buying it at market rates from sugar companies. Currently, mills have to sell 10% of their total production (termed levy sugar in govt parlance) to the government at Rs. 19.04 per kg as against the wholesale market price of Rs. 31 per kg. The government then sells this sugar at Rs. 13.50 per kg to 6.52 crore poor families for public distribution through ration shops bearing a subsidy of Rs. 2,300- Rs. 2,500 crore a year. We are discussing various measures to meet the additional financial burden likely to come after the removal of levy obligation on mills. We are considering an increase in excise duty or levying a nominal export duty (5-10%) to recover part of the cost, said a food ministry official. (Source: Economic Times)

Anti-GM lobby decries linking food security with transgenics

On the third anniversary of the moratorium on the commercial release of Bt brinjal, both pro- and anti-genetically modified (GM) crop campaigners rooted for their respective stand. The Coalition for GM-Free India observed February 9 as Food Safety Day, marking three years of moratorium on Bt brinjal in India. Pointing out that food security arguments around GM crops were baseless and fallacious, over 150 scientists sought the intervention of the Ministry of Environment and Forests to counter the Agriculture Ministrys affidavit in the Supreme Court that GM crops were essential for food security. In a letter to the Environment Minister Jayanthi Natarjan, the scientists said food security had no link with yield increases. They presented data from various countries to support their argument. (Source: Business Line)

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Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities
Chana
Chana prices declined during the last week on account of increasing supplies in the domestic markets amid start to harvesting. Further, higher output expectations also exerted pressure on the prices. Spot as well as futures settled 0.87% and 1.55% lower w-o-w. Ministry of Agriculture in its second advance estimates, have pegged, bumper chana output for 2012-13 season at 8.57 mn tn, up 11% from 2011-12 final estimates of 7.7 mn tn.

Market Highlights
Unit Rs/qtl Rs/qtl Last 3609 3426 Prev day 2.19 0.12

as on Feb 9, 2013 % change WoW MoM -0.87 -10.65 -1.55 -16.15 YoY 2.58 -2.23

Chana Spot - NCDEX (Delhi) Chana- NCDEX Apr'13 Futures

Source: Reuters

Pulses Sowing 2012-13

Technical Chart - Chana
Total pulses acreage as on 08 Feb 2013 stood at 148 lakh ha, up by 0.5% yoy. Chana sowing is 5.4% higher at 94.78 lakh ha compared to previous year. Chana acreage is marginally higher by 3% this year in Rajasthan at 14.80 lakh ha, In Maharashtra, Chana acreage is up at 11.12 lakh ha vs normal area of 10.6 lakh ha. While in AP it is up at 7.27 lakh ha, up by 28%. Compared to previous year. (Source: State farm dept)
NCDEX April contract

Demand supply fundamentals

According to second advance Estimates released on 8 Feb 2013, Total pulses output for 2012-13 season has been pegged at 17.58 mn tn, down 3.3% compared to previous year. The target for 2012-13 pulses crop output was set at 18.24 million tonne during the year. However, drought conditions have hampered kharif pulses output, which has been only partially offset by Rabi pulses output, especially chana. Out of the total pulses output, kharif output is estimated at 23% lower at 5.48 mn tn while rabi pulses output is pegged 8.72% higher at 12.09 mn tn compared with the final estimates of 2011-12. There has been a sharp increase in the chana output estimates. on the back of higher acreage and good yield. Chana output is expected to breach its 2010-11 record of 8.2 mn tn and is estimated at 8.57 mn tn for 2012-13. In its first advance estimates chana output was pegged at 7.9 mn tn. India needs imports as its domestic production is insufficient to meet the rising demand. The countrys import bill on pulses stood at $1.83 billion in 2011-12. Assocham estimates, 21 mn tn of pulses demand in 2012-13 and is likely to reach at 21.42 mn tn in 2013-14 and 21.91 MT in 2014-15. (Source: Agriwatch).
th

Source: Telequote

Technical Outlook
Contract Chana Apr Futures Unit Rs./qtl Support

valid for Feb 11, 2013 Resistance 3445-3460

3395-.3410

Trade Scenario
In Australia, total chickpea production in 201213 is estimated to have increased to a record of around 746000 tones as compared with 485000 tons in 2011-12. India imports Chana mainly from Australia and Canada and higher availability in these countries at comparatively cheaper rates is seen boosting imports of Chana to meet the domestic shortfall.

Outlook
Chana Futures are expected to remain under downside pressure in the coming week as the agriculture ministry has estimated bumper chana output for 2012-13 season. Also arrivals shall gain momentum in the coming days and is expected to increase the supplies in the markets. Also, higher output of Chana in other producing countries like Australia and Canada is expected to support the weak market sentiments.

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Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities
Sugar
Sugar March contract declined sharply in the early part of last week on account of higher production and availability in the domestic markets and comparatively lower demand amid winter season. However, prices recover towards the later part of the week on hopes of partial decontrol of sugar industry. The Spot as well as the Futures settled 1.69% and 2.39% lower w-o-w. Food minister KV Thomas on Thursday said the government is likely to take a decision on decontrolling the sugar industry before the Budget. Food ministry has proposed dispensing with the regulatory release mechanism and abolishing the levy system. India has fixed FRP (Fair and Remunerative Price), the price sugar mills must pay to cane growers at 210 rupees per 100 kg in the 2013/14 year, compared to current years 170 per qtl. Higher floor price increases the cost of production as the raw material cost constitute the major part of cost of production of sugar. This should actually increase the prices of sugar. Raw sugar futures on ICE as well as Liffe white sugar traded on a negative note and settled 1.02% and 0.11% lower respectively on Friday after the USDA data estimated record US sugar output for 2012-13 season.

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Feb'13 Futures Rs/qtl Last 3181

as on Feb 9, 2013 % Change Prev. day WoW 0.17 -1.69 MoM -2.12 YoY 6.84

Rs/qtl

3021

0.23

-2.39

-5.65

4.32

Source: Reuters

International Prices
Unit Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures $/tonne $/tonne Last 485.4 403.11

as on Feb 8, 2013 % Change Prev day WoW -1.02 -0.11 -3.40 -3.97 MoM -4.26 -3.10 YoY -25.40 -26.47

.Source: Reuters

Technical Chart - Sugar

NCDEX March contract

Domestic Production and Exports

Out of the estimated 24 mn tn sugar output for the season 2012-13, Indian 13.7 mn tn in the first four months of the season beginning October 2012, up 3 percent a year ago period. With the opening stocks of 6.5 mn tn, domestic Sugar supplies are estimated at 30.5 mn tn against the domestic consumption of around 22. 5mln tn for 2012-13. Exports are not viable as international prices have also declined significantly.

Global Sugar Updates

The USDA on Friday boosted its domestic sugar supply forecast in the 2012/13 marketing year, projecting record production. U.S. sugar production in the current marketing year is pegged at 9.22 million short tons, up from last month's estimate at 9.07 million tons. If the forecast is realized, it will be a record high, exceeding the record 9.032 million short tons harvested in the United States in 1999/2000. In the international markets, ICE Raw sugar fell to their lowest level since August 2010 to 18.46 cents in the last week expecting third consecutive year of global surplus in 2012-13. A third consecutive global sugar surplus will trim prices as supply is forecast to exceed demand by more than 8 million tonnes in the crop year to September 2013. Markets would need weather scares or bullish ethanol policy changes in Brazil to encourage new longs. Otherwise, prices will remain depressed. Brazil's main center-south cane crop will produce between 580 million and 590 million tonnes of sugar cane in 2013/14. Brazil will likely favor ethanol production over sugar from the 2013/14 cane crop.

Source: Telequote

Technical Outlook
Contract Sugar Mar NCDEX Futures Unit Rs./qtl Support

valid for Feb 11, 2013 Resistance 3065-3080

3015-3030

Outlook
Sugar futures are expected to consolidate at the lower levels as markets may adopt a wait and watch policy expecting government to take decision levy sugar mechanism, one of the major reforms of sugar decontrol. The hike in cane price and thereby increase in sugar production cost may also support prices as this may force government to take some measures to increase sugar prices.

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Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities
Oilseeds
Soybean: Soybean futures opened the week higher on account of
remained higher oil meal export figures which jumped 40 percent in January. However, the prices declined sharply towards the end as the USDA monthly crop report released on Friday pegged higher global ending stocks. The Spot as well as the March Futures settled 1.22% and 0.65% lower w-o-w. Oil meal exports rose by almost 40 per cent to 7.68 lakh tonnes in January this year, industry body Solvent Extractors Association of India said. The export of oil meals, however declined by 18 per cent to 36.79 lakh tonnes in the first 10 months of this fiscal compared to 44.85 lakh tonnes in the year-ago period. The country exported 25.36 lakh tn soybean meal in first 10 months compared to 30.82 lakh tn in the same period last year which showing a decline of 17.72%. According to the second advance estimates, 2012-13 oilseed output is pegged at 29.4 mn tn, down by 1.1%, while soybean output is pegged higher at 12.9 mn tn, up 3.2%.

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Feb '13 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Feb '13 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3325 3302 734.2 724.2

as on Feb 9, 2013 % Change Prev day -1.39 -0.95 -0.11 -0.11 WoW -1.22 -0.09 -3.23 -2.54 MoM 3.13 5.19 -0.11 -0.08 YoY 32.05 31.27 4.65 2.80

Source: Reuters

as on Feb 8, 2013 International Prices Soybean- CBOTMar'13 Futures Soybean Oil - CBOTMar'13 Futures Unit USc/ Bushel USc/lbs Last 1453 51.43 Prev day -2.30 -0.81 WoW -1.48 -2.94 MoM 2.74 4.66
Source: Reuters

YoY 18.33 -2.11

International Markets
Soybean futures on the CBOT corrected sharply as USDA raised its forecast of global 2012/13 soybean ending stocks above 60 million tonnes, up from 59.46 million in January and settled 2.3% lower on Friday. Upward revision in Brazils soy output is offset by downward revision in the Argentina production. However, persistent dry, hot weather in much of Argentina is hurting 2012/13 crops as they enter crucial growth stages, and rains are needed to safeguard potential yields, the countrys agriculture ministry said last week. Thus output may be revised down further. China, the world's largest soy buyer, imported 4.78 million tonnes of soybeans in January, down 18.8 percent from 5.89 million tonnes in December

Crude Palm Oil

as on Feb 9, 2013 % Change Prev day WoW 0.40 -0.02 -1.27 0.00

Unit
CPO-Bursa Malaysia Feb '13 Contract CPO-MCX- Feb '13 Futures

Last 2480 451.7

MoM 4.69 3.89

YoY -19.92 -13.80

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Apr'13 Futures Rs/100 kgs Rs/100 kgs Last 4200 3391 Prev day 0.00 -0.47

as on Feb 9, 2013 WoW 0.72 -2.33 MoM -1.18 -19.83

Source: Reuters

YoY 23.53 -0.91

Refined Soy Oil: Ref soy oil settled 2.54% lower last week taking
cues from weak international markets while MCX CPO settled unchanged. The head of the Solvent Extractors' Association of India has proposed India should raise the duty on crude edible oil imports to 10 percent from the recently revised 2.5 percent. India's palm oil imports rose 27.4% on month at 783,091 tn in December, boosted mainly by poor domestic supply of alternatives and attractive overseas prices due to record stocks in key supplier Malaysia.

Technical Chart Soybean

NCDEX March contract

Rape/mustard Seed: Mustard seed Futures settled 2.33% lower

w-o-w on higher output expectations. Mustard seed sowing is now up by 2.2% at 67.23 lakh ha. Arrivals are expected to commence in February and thus no major upside in the prices is seen if weather condition improve in the coming days. Agriculture ministry in its third advance estimates, pegged mustard output at 7.36 mn tn , up by 11.5%.

Source: Telequote

Outlook
Soybean complex may trade with downward bias taking cues from the weak international markets as USDA report raised its forecast of ending stocks. Mustard seed is expected to trade downwards on higher output expectations. CPO is expected to trade sideways during the intraday.

Technical Outlook
Contract Soy Oil Mar NCDEX Futures Soybean NCDEX Mar Futures RM Seed NCDEX Apr Futures CPO MCX Feb Futures Unit Rs./qtl Rs./qtl Rs./qtl Rs./qtl

valid for Feb 11, 2013 Support 693-697 3195-3215 3360-3375 444-448 Resistance 705-709 3260-3290 3410-3430 455-459

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Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities
Black Pepper
Pepper March Futures recovered from lower levels after declining for third consecutive sessions on account of short coverings. Improvement in the arrivals of the fresh crop led to a decline in the prices earlier last week. Low stocks, thin supplies and delayed harvesting due to lack of skilled laborers have pushed up the prices over the last couple of weeks. Good winter demand also supported the prices. Food Safety and Standards Authority of India sealed the entire quantity of pepper stored in six warehouses in Kerala of about 8,000 tonnes. Harvesting of the fresh crop is going in and is expected to gain momentum in the coming days. Exports demand for Indian pepper in the international markets is also weak due to price parity. The Spot as well as the Futures settled 0.33% and 0.32% higher on Saturday. Spices Board has announced plans to import high yielding Madagascar variety that was behind the record productivity in Vietnam. It could raise productivity of Indian pepper from 2,000 kg/ha to 7,000 kg/ha. Pepper prices in the international market are being quoted at $8,000/tn(C&F Europe). Vietnams 550 GL is quoted at $6,500/tn, Malaysia and Indonesia Austa variety are quoted at $7,000/tn and Brazil black pepper is quoted at $6,600/tn.

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Feb'13 Futures Rs/qtl Rs/qtl Last 40353 38730 % Change Prev day 0.33 0.32

as on Feb 9, 2013 WoW -1.01 -0.36 MoM 5.19 8.18 YoY 30.64 30.10

Source: Reuters

Technical Chart Black Pepper

NCDEX March contract

Exports and Imports

According to Spices Board of India, exports of pepper in April 2012 fell by 47% and stood at 1,200 tonnes as compared to 2,266 tonnes in April 2011. India imported 1,848 tonnes of pepper till March 2012 and has become the third country to import such large quantity after UAE and Singapore. (Source: Agriwatch) According to Vietnam Ministry of Agriculture and Rural Development (MARD) exports of pepper during Jan-Oct 2012 stood at 102,340 mt, lower by 12% as compared to 1,15,780 mt in the same period last year. Total exports in 2012 are forecasted at around 1,10,000 tonnes. Pepper imports by U.S. the largest consumer of the spice declined 26% during January-September 2012 period to 41,923 tn as compared to 52,489 tn in the same period previous year. Exports from Indonesia posted significant decrease of 42% as compared to previous year. Exports stood at 36,500 tonnes as compared to 62,599 tonnes in the last year. Brazil exported 25,900 tn pepper during Jan-Nov 2012, around 20% lower compared with 32,650 tn in the same period last year. Exports from Malaysia 8,300 tn pepper during Jan-Oct 2012, lower by 30% last year while exports in October stood at 1,077 mt in.

Source: Telequote

Technical Outlook
Contract Black Pepper NCDEX Mar Futures Unit Rs/qtl

valid for Feb 11, 2013 Support 35330-35510 Resistance 35870-36040

Production and Arrivals

The arrivals in the spot market were reported at 15 tonnes while off takes were reported at 15 tonnes on Friday. As per IPC, Global pepper production in 2012 is projected at 3.27 lk tn, up compared with 3.18 lk tn in 2011. Production for 2013 is projected at 316832 tn. Indonesian pepper output is expected to rise by 24% and in Vietnam by 10%. According to previous estimates, pepper output in Vietnam is estimated to be 1 lakh tonne in 2012 as compared to 1.1 lakh tonne in 2011. Brazil is also expected to produce 22,000 tn this year. Domestic consumption of Pepper in the world is expected to grow by 3.03% to 1.25 lakh tonnes while exports are likely to grow by 1.48% to 2.46 lakh tonnes in 2012. (Source: Pepper trade board) Pepper production in 2012-13 is expected around 60,000-63,000 tonnes. Currently, pepper is in the fruit formation stage in Kerala.

Outlook
Pepper is expected to decline in the intraday on reports of improvement in arrivals of the fresh crop. However, low stocks coupled with thin arrivals may limit sharp downside. Winter buying demand may also support prices at lower levels.

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Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities
Jeera
Jeera Futures traded on a negative note on Saturday on commencement of arrivals of the new crop. The arrivals of new crop is around 300-400 bags/day and is expected to gain momentum in the coming days. Some export demand from Bangladesh was reported last week. Higher sowing as well as conducive weather in Gujarat, the main jeera growing region has increased output expectations. Sowing is complete. According to Gujarat State Agri Dept. sowing in Gujarat is reported at 3.244 lakh ha till Jan, 2013 compared with 3.64 lakh ha last year. In Rajasthan, sowing is expected to increase by 10-15%. The spot as well as the Futures settled 0.47% and 0.93% lower on Saturday. According to markets sources about 75% exports target has already been achieved due to a supply crunch in the global markets. Supply concerns from Syria and Turkey still exists. Expectations are that export orders may still be diverted to India from the international markets due to lack of supplies from Syria on back of the ongoing civil war. Production in Syria and Turkey is being reported around 17,000 tonnes and around 4,000-5,000 tonnes, lesser than expectations. Jeera prices of Indian origin are being offered in the international market at $2,950-2,975 tn (c&f) while Syria and Turkey are not offering. Carryover stocks of Jeera in the domestic market is expected to be around 5-6 lakh bags.

Market Highlights
Unit Jeera Spot- NCDEX (Unjha) Jeera- NCDEX Mar '13 Futures Rs/qtl Rs/qtl Last 13864 13100 Prev day -0.47 -0.93

as on Feb 9, 2013 % Change WoW -1.25 -5.06 MoM -3.74 -5.64 YoY -7.46 -9.57

Source: Reuters

Technical Chart Jeera

NCDEX March contract

Production, Arrivals and Exports

Arrivals in Unjha were reported at 2,500 tn on Saturday. Production of Jeera in 2011-12 is expected around 40 lakh bags as against 29 lakh bags in 2010-11 (55 kgs each). According to Spices Board of India, exports of Jeera in April 2012 stood at 2,500 tonnes as compared to 2,369 tonnes in April 2011, an increase of 6%.
Source: Telequote

Market Highlights
Prev day 0.00 0.65

as on Feb 9, 2013 % Change

Outlook
Jeera is expected to continue to decline today on the back of commencement of arrivals of the new crop. Higher sowing figures coupled with conducive weather in Gujarat may also pressurize prices. However, overseas demand at lower levels may support prices. Demand from domestic traders and millers may also support prices at lower levels. In the medium term, prices are likely to stay firm as Syria and Turkey have stopped shipments.
Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Apr '13 Futures

Unit Rs/qtl Rs/qtl

Last 5344 6214

WoW -2.23 0.78

MoM -6.13 -6.72

YoY 13.04 27.44

Technical Chart Turmeric

NCDEX April contract

Turmeric
Turmeric Futures recovered from lower levels on Saturday on account of covering of short positions and settled 0.65% higher. Prices have corrected from higher levels due to higher carryover stocks. There are reports of some crop damage in Erode region. Expectations are that production may be lower by 40-50%. Production is expected around 55 lakh bags. It is estimated that next years carryover stocks would be around 10 lakh bags. There are reports that Turmeric Farmers Association of India have decided to fix their own MSP of Rs.10000/qtl.

Production, Arrivals and Exports

Arrivals in Erode and Nizamabad mandi stood at 5,000 bags and 8,000 bags respectively on Friday. Turmeric production in 2012-13 is expected around 55 lakh bags. Production in 2011-12 is projected at historical high of 10.62 lakh tn. According to Spices Board of India, exports of Turmeric in April 2012 increased by 1% at 7,300 tn as compared to 7,230 tn in April 2011. Outlook Turmeric is expected to trade lower today. Higher carryover stocks and weak overseas demand may pressurize prices. However, lower output concerns and demand from stockists at lower levels is expected to support prices at lower levels.
.

Source: Telequote

Technical Outlook
Unit Jeera NCDEX March Futures Turmeric NCDEX April Futures Rs/qtl Rs/qtl

Valid for Feb 11, 2013

Support 12950-13025 6100-6160 Resistance 13210-13320 6270-6320

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Commodities Daily Report

Monday| February 11, 2013

Agricultural Commodities
Kapas
After witnessed sharp decline, NCDEX Kapas recovered 0.62% on Saturday taking cues from the international markets which rose after the release of USDA monthly report. MCX Cotton also settled 0.6% higher on Saturday. Prices have declined initially on the back higher availability of cotton amid dull demand. Cotton supplies from the new crop in the domestic markets until Jan. 20 fell were down at 134 lakh bales, from 144 lakh bales a year earlier. However, gap has narrowed down with increasing pace of arrivals. The Cotton Advisory Board, which met in Mumbai on Wednesday, has estimated cotton production this season (Oct 2012 to Sep 2013) will be 330 lakh bales against the previous estimates in October at 334 lakh bales. Also, exports and domestic consumption has been revised upward to 253 and 80 lakh bales respectively from 250 and 70 lakh bales estimated earlier. As on January 9 this year, nearly 38 lakh bales were registered for exports. ICE Cotton settled 1.56% higher on Friday as USDA report trims US stocks. Prices have also traded on a bullish note on hopes of demand from China. Concerns about the quality of cotton to be released by China also supported the prices.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 886.5 16870

as on Feb 9, 2013 % Change Prev. day WoW 0.62 -1.45 0.60 0.66 MoM -4.83 0.66 YoY #N/A -7.86

NCDEX Kapas Apr Futures MCX Cotton Feb Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit USc/Lbs Last 82.67 81.35

as on Feb 8, 2013 % Change Prev day WoW 1.56 -0.37 0.00 0.00 MoM 10.54 0.00 YoY -8.76 -29.20

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Domestic Production and Consumption

According to Cotton Advisory Boards (CAB) estimates (23 Jan 2013) for 2012-13 season that commenced in October, domestic cotton production is pegged 330 lakh bales, down from the previous years estimates of 353 lakh bales. However, higher exports and domestic consumption can be met through revised higher opening stocks of 40 lakh bales and higher imports. After witnessing record exports in 2011-12 season, Indian exports could witness significant fall this season on the back of lower availability along with unattractive domestic cotton prices. CAB estimates cotton exports at 80 lakh bales this season, compared with 128.8 lakh bales last year.
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Source: Telequote

Technical Chart - Cotton

MCX Feb contract

Global Cotton Updates

The U.S. government on Friday nudged higher its global cotton stockpile forecast for 2012/13 amid expectations that China, the world's largest textile market, will import even more fiber for its massive strategic supply. However, the government lowered US carryover by 300,000 bales, or 6 percent, to 4.5 million bales due to an increase of the same size in its export estimate to 12.5 million bales.

Outlook
Kapas prices may trade with upward bias during the intraday on account of bargain buying. However, sufficient supplies in the domestic markets and lower export demand expectations may pressurize prices. Also, international prices which had gained sharply in the last two weeks are due for correction amid rising certified stocks, and Chinese lunar New Year approaching.
Source: Telequote

Technical Outlook
Contract Kapas NCDEX April Futures Cotton MCX Feb Futures Unit Rs/20 kgs Rs/bale

valid for Feb 11, 2013 Support 875-880 16770-16820 Resistance 895-900 16910-16940

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