Commodities Daily Report

Tuesday| January 01, 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

Tuesday| January 01, 2013

Agricultural Commodities
News in brief
Commodity stock exchanges end 2012 with Rs 174-tn business
Commodity stock exchanges: Commodity futures market remained subdued in 2012 with turnover stagnating at last year's level of Rs 174 tn and the government's bill to strengthen the regulator FMC also getting stuck in Parliament. The FMCs steely resolve to curb speculation in various agri items like guar futures and the MCX becoming the country's first commodity exchange to be listed were some of the positives during the year. "The turnover of the exchanges has been declining every fortnight, especially in bullion, but the cumulative turnover would be close to the 2011 level." FMC Chairman Ramesh Abhishek said. The year 2012 put a break on growth in the turnover of the commodity futures market, which had been growing rapidly in the last few years. In 2011, turnover grew by 66% to Rs 174 tn. Stating that drop in the turnover of 20 commodity bourses was not a "major concern", Abhishek said the regulator's prime focus through the year was to make volumes more relevant and ensure a balance in speculation and hedging activities. "We saw much better regulatory measures in place this year to curb volatility in prices," he said, highlighting steps like imposition of special margin and cut in open position limit in agri items like guar, pepper, turmeric and soyabean, among others, in this regard. (Source: Financial Express)

Market Highlights (% change)

Last Prev. day

as on Dec 31, 2012

WoW MoM YoY

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

19427 5905 55 91.82 1675

-0.09 -0.06 0.43 1.12 1.20

0.89 0.84 0.07 3.62 0.98

0.45 0.43 1.35 3.27 -2.11

25.70 27.70 3.73 -7.09 6.96

.Source: Reuters

Punjab looks to reform agri marketing

The Parkash Singh Badal government may not have opened its doors to foreign direct investment in multi-brand retail yet but the state is ready to usher in much-delayed reforms in agricultural marketing to break the monopoly of state-owned markets, ensure better prices to farmers and push its diversification agenda. Punjab has been dithering on adopting the Model Agricultural Produce Marketing Committee (APMC) Act, adopted so far by 16 states after it was prepared by the agriculture ministry in 2003 and circulated to states. The Punjab government has now given approval in principle to amend the existing Punjab APMC Act, 1961, to allow free play to private players and farmers. We are in the process of amending the APMC Act to boost the states diversification progranmme by ensuring better prices to farmers, financial commissioner (development) G S Sandhu said. (Source: Financial Express)

Weak prices, slower demand pull down coffee exports in 2012

India's coffee exports fell by 9.15% to 3,09,570 tn during 2012 calendar year on account of weak international prices, tight domestic supply and some drop in demand due to global economic crisis, according to the Coffee Board of India. However, the export realisation was better than 2011 mainly because of better global prices of robusta variety in the beginning of the year, it added. In 2011, the country had shipped 3,40,779 tn coffee. "The shipments have come down this year for three reasons -- not so good demand for our coffee due to recession in some countries, falling prices in the global market and tight local stocks," a senior Coffee Board official told PTI. There was hardly any old stock left in the country for export purpose this year because much of it was exhausted in the last two years when demand was at its peak and international prices were high, the official said. Also, global prices remained less lucrative for Indian coffee exporters as improved supplies from Brazil and Vietnam dented prices, the official added. (Source: Financial
Express)

Cardamom continues to gain on short supply

Cardamom prices continued to gain, albeit marginally, despite some slackness in upcountry buying following a squeeze in supply last week believed to be due to regulated supply at auctions held in Kerala and Tamil Nadu. Exporters were active and said to have covered an estimated 25 tonnes of fresh cardamom last week. However, buyers from north Indian centres were slow due to drop in sales because of severe cold conditions prevailing in many parts of the up country region, market sources told Business Line. They said retailers were not opening the shops because of the unfavourable weather conditions. This phenomenon has led to a drop in demand which is only a temporary phenomenon, they claimed.. (Source: Business Line)

U.S. Plains wheat deteriorates throughout December

The health of the winter wheat crop deteriorated across the U.S. Plains in December despite some moisture late in the month, according to reports by the U.S. Agriculture Department's National Agricultural Statistics Service issued on Friday. In Kansas, the top wheat producing state, the crop was rated 24 percent good to excellent as of Dec. 30, down from 29 percent at the end of November. "Limited moisture in most areas caused the condition of the winter wheat to decline through December," NASS's Kansas field office said in a report.The Kansas report said that only 3 of the 53 weather reporting stations across the state received more than 1 inch of precipitation, with the southern areas remaining the driest. In Nebraska, the hard red winter wheat crop was just 14 percent good, 0 percent excellent compared to 74 percent a year earlier for those categories combined. (Source: Reuters)

Assams red rice gets ticket to global market

red rice grown in certain pockets of upper Assam has recently found a global market, thanks to its being organic by default. This is because a large section of farmers in the state depend more on rich alluvium left behind by the Brahmaputra every year rather than on chemical fertilisers. While the red rice has been duly certified as organic, apart from having a high content of iron, protein, vitamins and other nutrients, a Sonepat-based exporter has recently established the much-needed forward-linkage to a California-based importer for sending out the rice. A team from the California-based company visited Dhemaji district last month and has placed an order of 50 metric tonnes of red rice as the first consignment, said Mahendra Nath Phukan, district agriculture officer of Dhemaji, the easternmost district of Assam. With organic rice, like any other organic produce, having great demand in the developed world, bao-dhaan can turn out to be one crop that can benfit a large segment of our farmers. (Source: Financial Express)

Exporters sell 140,000 T US soybeans to unknown buyer for '12/13

WASHINGTON, Dec 31 (Reuters) - Private exporters reported the sale of 140,000 tonnes of U.S. soybeans to unknown destinations for delivery this marketing year, said the Agriculture Department on Monday. The 2012/13 marketing year for soybeans opened on Sept 1. By law, exporters must report promptly the sale of 100,000 tonnes or more of a commodity to the same destination in one day but it sometimes can take a couple of days for the identity of a buyer to become known. Sales of smaller amounts are reported on a weekly basis. (Source: Reuters)

Canadian Pea Export Down by 78% in November

The Canadian Grain Commission (CGC) revealed that 55000 MT of field peas were exported in Nov, 2012. Te same was down from last month's exportand same corresponding month in last year. Meanwhile, all of the Canadian pea in November is exported to Indian Sub-continent. Bangladesh imports 30000 MT, India import 14000 MT and China import 11000 MT of pea in November month. (Source: Agriwatch)

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Commodities Daily Report

Tuesday| January 01, 2013

Agricultural Commodities
Chana
After declining sharply during the last week, Chana prices witnessed short coverings on Monday expecting demand to emerge at lower levels. January contract settled 1.21% higher while spot settled 0.87% higher on Monday. Although chana prices witnessed 17.03% y-o-y gains on the back of lower availability, sentiments have turned negative during the last one month on account of continuous supplies of imported chana from Australia coupled with higher output expectations. As a result, prices in the month of December 2012 declined 8.8%.

Market Highlights
Unit Rs/qtl Rs/qtl Last 3883 3852 Prev day 0.87 1.21

as on Dec 31, 2012 % change WoW MoM -5.53 -11.74 -4.30 -8.72 YoY 16.79 17.15

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

Source: Reuters

Sowing progress
Total pulses acreage as on 28th Dec 2012 stood at 132.52 lakh ha, down by 1.2% yoy. As on 21st Dec, pulses acreage was down by 0.9%. Chana sowing is nearing its end and is expected to be marginally higher compared to last year. As per the Agriwatch report, Chana sowing is up 3.7% at 86.63 lakh ha. Overall Pulses sowing might decline marginally. Chana acreage is marginally higher by 1.6 this year in Rajasthan at 14.57 lakh ha, In Maharashtra Chana acreage is up at 10.7 lakh ha as on 28th Dec, 2012 vs 6.8 lakh ha year ago. While in AP it is up at 6.64 lakh ha as on 19th Dec. (Source: State farm dept)

Technical Chart - Chana

NCDEX Jan contract

Demand supply fundamentals

Chana fresh crop arrival has started in Karnataka & Andhra Pradesh and would commence soon in Maharashtra too. However, arrival pressure will built up February onwards when harvesting commence in MP. Farm ministry has targeted 7.9 mn tn Chana output for 2012-13 season, higher compared to 7.58 mn tn in 2011-12. According to the first advance estimates of 2012-13 season, kharif pulses output is estimated lower by 14.6% at 5.26 million tonnes compared with 6.16 mn tn last year. The Commission for Agriculture Costs and Prices (CACP) has suggested 10 per cent import duty on pulses to encourage domestic production. in the first six months of the new fiscal that is from April to September this year, imports were an estimated 12 lakh tonnes. 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).
Source: Telequote

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

valid for Jan 1, 2013 Resistance 3885-3920

3785-3820

Trade Scenario
USDA revealed that Myanmar beans and pulses export is up by 56 per cent to 110498 MT as compared with same period in last year. Out of the total export, 73 percent (80721 MT) was exported to India followed by Singapore (11316 MT). (Source: Agriwatch dated Dec 27) 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
Sufficient supplies amid higher shipments and expectations of better output next season may exert downside pressure on Chana prices in the intraday. Harvesting of new crop have commenced in AP and Karnataka. In Maharashtra arrivals would commence in January and gradually increase February onwards once the arrivals from MP begin.

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Commodities Daily Report

Tuesday| January 01, 2013

Agricultural Commodities
Sugar
Sugar futures extended the losses of the previous week and settled 0.15% lower on Monday. Spot prices also settled 0.03% lower amid subdued demand. Higher availability in the domestic markets and subdued demand has exerted downward pressure and thus prices plunged 2.26% in the last one month. While on year on year basis sugar futures have gained 11.81% on the back of expected lower output in the domestic markets. Government has allocated total 70 lac tons of non-levy sugar quota for Dec-March 2012-13 period which is higher from 59.5 lac tons last year. The government is planning to remove quantitative restrictions on sugar exports and imports and will use tariffs to regulate trade. Raw sugar futures on ICE as well as Liffe white sugar settled 0.33% and 0.46% higher on Monday on account of short coverings. Prices have corrected due to supply glut in the global markets. According to Unica, Brazil's 2012-2013 center-south sugar output is expected to reach 34.05 million tonnes, an estimate 4.1% higher than its 32.7 million tonnes September forecast.
Sugar No 5- LiffeMar'13 Futures Sugar No 11-ICE Mar '13 Futures

Market Highlights
Unit Sugar Spot- NCDEX (Kolhapur) Sugar M- NCDEX Jan'13 Futures Rs/qtl Last 3263

as on Dec 31, 2012 % Change Prev. day WoW -0.03 -0.64 MoM -5.12 YoY 10.15

Rs/qtl

3238

-0.15

-0.77

-2.26

11.81

Source: Reuters

International Prices
Unit $/tonne $/tonne Last 523.7 433.56

as on Dec 31, 2012 % Change Prev day WoW 0.33 0.46 1.39 2.58 MoM 2.55 1.46 YoY -16.83 -20.40

.Source: Reuters

Domestic Production and Exports

Mills in the country have produced 4.91 mln tn sugar in the current sugar season till Dec 15, up nearly 2% from 4.82 mln tn produced a year ago. In Maharashtra, the largest sugar producer in the country, 155 mills are operational and have produced 1.88 mln tn sugar till Dec 15, compared with 1.83 mln produced a year ago by 165 mills. In Uttar Pradesh, the second largest sugar producer in the country, total output as on Dec 15 was 1.03 mln tn, about 20% lower on year, as some mills in the eastern part of the state are still to commence cane crushing. According to the first advance estimates by agriculture ministry, Sugarcane output is pegged at 335.3 mn tn, down by 6.2% compared to 357.6 mn tn last year. The producers body has estimated sugar output lower at 24 mn tn, down by 2mn tn compared to the current year. Industry body ISMA has estimated 6.5 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may export 1.5 mn tn sugar in 2012-13. 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.

Technical Chart - Sugar

NCDEX Jan contract

Source: Telequote

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

valid for Jan 1, 2013 Resistance 3250-3260

3220-3230

Global Sugar Updates

According to the Brazil Agriculture Ministry, 2012-13 sugar output will reach 37.66 mn tn by the end of the season, less than the 39 mn tn forecast in August. Consultancy Kingsman revised up its 2012/13 world sugar surplus estimate to 9.2 million tonnes raw value on Friday, citing increased supply from producers including Brazil and China. Kingsman pegged global 2012/13 sugar output at 180.1 million tonnes raw value, up from the previous estimate of 177.3 million tonnes. (Source: Reuters)

Outlook
Sugar prices are expected to trade on a negative note today account of sufficient supplies in both the domestic as well as global markets. However, a sharp downside may by restricted on expectations government may remove quantitative restrictions on sugar import/export.

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Commodities Daily Report

Tuesday| January 01, 2013

Agricultural Commodities
Oilseeds
Soybean: Soybean futures declined further taking cues from International markets and settled 1.2% lower on Monday.
Arrivals in the domestic markets declined to 1.9 lakh bags, while demand is comparatively lower amid subdued overseas demand. According to first advance estimates, Soybean output is pegged at 126.2 lakh tn for 2012-13. Exports of soy meal rose to 517,103 tonnes in Nov from 3.97 lakh tn year ago. Overall oil meal exports in the first eight months of the year beginning April fell to 2.4 mn tn from 3 mn tn a year ago.

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Jan '13 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soy oil- NCDEX Jan '13 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 3314 3203 710.5 695.8

as on Dec 31, 2012 % Change Prev day 0.12 -1.20 -0.18 -1.22 WoW 0.03 -0.82 -0.49 0.26 MoM 1.84 -0.20 -4.19 -3.39 YoY 34.50 29.65 -1.56 -3.29

International Markets
Soybean futures on the Chicago Board of Trade fell around 0.4% Monday as favorable crop weather in South America fueled expectations for large harvests. Net sales of 619,400 MT for the 2012/2013 marketing year down 53 percent from the previous week and 23 percent from the prior 4week average. Last week, private exporters reported the cancellation of 540,000 tonnes of U.S. soybeans sold to China - the biggest cancellation by the world's top importer of the oilseed in at least 14 years. Brazil's government food supply agency Conab forecast the soybean crop at a record 82.6 million tonnes.

Source: Reuters

as on Dec 31, 2012 International Prices Soybean- CBOTJan'13 Futures Soybean Oil - CBOTJan'13 Futures Unit USc/ Bushel USc/lbs Last 1419 49.16 Prev day -0.37 0.45 WoW -1.46 0.45 MoM -1.90 -1.90
Source: Reuters

YoY 18.38 -5.62

Crude Palm Oil

as on Dec 31, 2012 % Change Prev day WoW -1.99 -0.33 1.62 2.43

Refined Soy Oil: MCX CPO futures that gained sharply last week
on concerns of supply disruptions in Malaysian palm oil and export duty cut, witnessed profit booking on Monday and settled 0.3% lower. Losses in Soy oil were higher on account of weak soybean futures. Indonesia, the world's top palm oil producer, reduced its export tax on crude palm oil to 7.5 percent for January from 9 percent in December. Malaysian palm oil product exports during December fell 5.7 percent to 1,568,510 tonnes from 1,663,092 tonnes in November. (Source: ITS)
Unit
CPO-Bursa Malaysia Jan '13 Contract CPO-MCX- Dec '12 Futures

Last 2320 417.1

MoM 7.41 -1.30

YoY -26.93 -23.41

MYR/Tonne Rs/10 kg

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Jan'13 Futures Rs/100 kgs Rs/100 kgs Last 4250 4179 Prev day 0.02 -0.24

as on Dec 31, 2012 WoW -1.73 0.10 MoM 1.25 -0.24

Source: Reuters

YoY 23.77 15.12

Rape/mustard Seed: Mustard seed prices settled marginally

lower by 0.24% on Monday on account of profit taking. Low stocks in the domestic market have supported the prices. Rabi oilseeds sowing which was up by 4.9% as on Dec 14, is now up by 1.3% at 7.9 mn ha. The sowing of major rabi oilseed, i.e. mustard seed, is up with acreage in largest producing state Rajasthan at 26.63 lakh ha vs to 24.41 lakh ha. Indian farmers have cultivated rapeseed on 6.5 million hectares as of Dec. 28, compared with 6.38 million hectares during the same period last year. rapeseed output is expected to rise by 5% to 6.5 mn tn from 6 mn tn last year.

Technical Chart Soybean

NCDEX Jan contract

Outlook
Soybean complex may recover in the initial part of the session today on account of short coverings. However, prices may again come under downside pressure on account of weak demand.
Source: Telequote

Mustard seed prices are expected to trade on a positive note today as sentiments remain positive amid tight supplies till the fresh crop arrives in February. Palm oil may continue to trade with a positive bias on expectations of supply disruptions in Malaysia caused by monsoon driven floods. Also, export duty cut may reduce Malaysian palm oil stocks.

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

valid for Jan 1, 2013 Support 687-692 3160-3185 4100-4135 425-431 Resistance 703-710 3235-3270 4210-4250 441-446

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Commodities Daily Report

Tuesday| January 01, 2013

Agricultural Commodities
Black Pepper
Pepper Futures traded with a positive bias on yesterday on account of short coverings. Prices have corrected as Food Safety and Standards Authority of India sealed the entire quantity of pepper stored in six warehouses in Kerala of about 5,000 tonnes. The six warehouses have also been sealed. Harvesting of the fresh crop has commenced and is expected to gain momentum in the coming days. Arrivals of the fresh crop have also pressurized prices. However, winter demand coupled with low stocks in the domestic markets has supported prices at lower levels. FMC is probing into complaints against movement in the pepper market which has pressurized prices. Better output expectations in the domestic as well as the international markets have also pressurized prices over the last couple of weeks. Exports demand for Indian pepper in the international markets is also weak due to price parity. The Spot as well as the Futures settled 0.23% and 0.85% higher on Monday. Pepper prices in the international market are being quoted at $7,200/tn(C&F Europe), while Vietnam was offering Austa at $7,000/tn, Brazil Austa at $6,000-6,500/tn, and Indonesia Austa at $6,500/tn (FOB).

Market Highlights
Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Feb'13 Futures Rs/qtl Rs/qtl Last 37894 34300 % Change Prev day 0.23 0.85

as on Dec 31, 2012 WoW -0.46 -1.78 MoM 0.45 -8.18 YoY 13.73 3.47

Source: Reuters

Technical Chart Black Pepper

NCDEX Feb 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 Feb Futures Unit Rs/qtl

valid for Jan 1, 2013 Support 33780-34040 Resistance 34530-34760

Production and Arrivals

The arrivals in the spot market were reported at 17 tonnes while off takes were reported at 17 tonnes on Monday. 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 may trade on a negative note today. Reports that FSSAI has sealed huge quantity of pepper are expected to maintain pressure on the prices. Good arrivals coupled with higher output expectations, as well as reports that FMC is probing into complaints against price movement may pressurize prices. However, winter buying may support prices at lower levels.

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Commodities Daily Report

Tuesday| January 01, 2013

Agricultural Commodities
Jeera
Jeera Futures traded with a negative bias yesterday tracking Improvement in the ongoing sowing coupled with weak domestic demand. Fresh export enquiries coupled with demand from stockists and masala millers had boosted the prices over the last couple of days. According to Gujarat State Agri Dept. sowing in Gujarat is reported at th 2.635 lakh ha as on 18 Dec, 2012 compared with 2.319 lakh ha last year. In Rajasthan, sowing is expected to increase by 10-15%. Higher stocks for delivery on the exchange warehouse were pressurizing prices during the last one month. The spot as well as the Futures settled 0.12% and 0.25% lower on Monday. 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 $2,775-2,825 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 SpotNCDEX(Unjha) Jeera- NCDEX Mar '13 Futures Rs/qtl Rs/qtl Last 14830 14673 Prev day -0.12 -0.25

as on Dec 31, 2012 % Change WoW -1.36 -3.94 MoM -1.25 3.27 YoY -4.31 -8.47

Source: Reuters

Technical Chart Jeera

NCDEX March contract

Production, Arrivals and Exports

Arrivals in Unjha were reported at 3,000 tn on Monday. 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 1.71 3.31

as on Dec 31, 2012 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Apr '13 Futures Rs/qtl Rs/qtl

Last 5635 6798

WoW 6.90 8.01

MoM 12.76 38.85

YoY 10.21 46.64

Outlook
Jeera futures are expected to continue to trade on a negative note today. Higher sowing thereby higher output expectations in Gujarat are expected to may pressurize prices. However, export demand may support prices at lower levels. In the medium term (Dec-Jan), prices are likely to stay firm as there are limited stocks with Syria and Turkey.

Turmeric
Turmeric Futures traded on a bullish note yesterday and hit a new contract due to demand from the stockists. Lower production estimates have supported the prices. Also, arrivals of good quality crop have supported prices. 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. The Spot remained closed while the Futures settled 0.18% lower on Saturday.

Technical Chart Turmeric

NCDEX April contract

Production, Arrivals and Exports

Arrivals in Nizamabad and Erode mandi stood at 1,000 bags and 4,000 bags respectively on Monday. Turmeric production in 2012-13 is expected around 64-65 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 on bullish note today as demand from stockists as well as lower production expectations may boost the prices. However, gains may be limited as higher carryover stocks and weak overseas demand can weigh in on the prices.

Source: Telequote

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

Valid for Jan 1, 2013

Support 14570-14640 6550-6670 Resistance 14820-14930 6870-6950

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Commodities Daily Report

Tuesday| January 01, 2013

Agricultural Commodities
Kapas
After declining sharply last week, Kapas prices witnessed short covering and settled marginally higher by 0.15% on Monday. MCX January contract settled 0.3% higher on Monday, while December contract expired with 2.9% gains. Although, Cotton advisory Board has pegged cotton output lower at 334 th lakh bales, Cotton Association of India (CAI), in its latest 90 annual general meeting said that Cotton production in the season 2012-13 is expected to be around 350 lakh bales, while the consumption is likely to be around 265 lakh bales. According to the data released by Cotton Corporation of India, Supplies until Dec. 16 fell to 6.2 million bales of 170 kg each, down from 6.9 th million bales a year earlier. Arrivals were down by 12.5 percent as on 9 December. However, it is still below expectations as many farmers, who are waiting for better returns, hold back their produce. Cotton yarn prices have jumped 14.7 percent from Rs.170/Kg to Rs. 195/Kg in Mumbai benchmark market of cotton yarn due to spur in demand form millers and exporters. Demand is mainly coming from China. While domestic market demand is also picking up on seasonal demand. (Dated 21 Dec) ICE Cotton futures settled higher by 0.64% on Monday. Global Cotton Prices are expected to recover on account of good demand from China. The USDA monthly report cuts cotton stocks estimate to 79.64 million bales, from last month's forecast of 80.27 million.

Market Highlights
Unit Rs/20 kgs Rs/Bale Last 982 16350

as on Dec 31, 2012 % Change Prev. day WoW 0.15 -3.35 0.74 -0.37 MoM 0.92 -0.37 YoY #N/A -3.99

NCDEX Kapas Futures MCX Cotton Futures

Source: Reuters

International Prices
ICE Cotton Cot look A Index Unit Usc/Lbs Last 75.14 81.35

as on Dec 31, 2012 % Change Prev day WoW 0.64 -1.65 0.00 0.00 MoM 5.77 0.00 YoY -21.57 -29.20

Source: Reuters

Technical Chart - Kapas

NCDEX April contract

Domestic Production and Consumption

According to Cotton Advisory Boards (CAB) estimates (4 Oct 2012) for 2012-13 season that commenced in October, domestic cotton production is pegged 334 lakh bales, down 5.6% from the previous years estimates of 353 lakh bales. Lower opening stocks coupled with estimated lower output will result in lower supplies this season at 374 lakh bales, a decline of 8.7% compared with last years 410.77 lakh bales. On the consumption front, domestic consumption is estimated higher at 270 lakh bales on the back of higher mill consumption. However, 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 70 lakh bales this season, compared with 128.8 lakh bales last year.
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Source: Telequote

Technical Chart - Cotton

MCX Jan contract

Global Cotton Updates

Net Upland sales of 283,300 running bales for the 2012/2013 marketing th Year was down 15 percent from the previous week. (Dated 28 Dec 2012). Cotton harvesting is 84% completed in US, versus 85% same period a year ago. Cotton crop condition is 43% in Good/Excellent state compared to 29% same period a year ago as on 20th Nov 2012. Brazils 2012-13 cotton production forecast at 6.3 million bales, down 27 percent from 2011/12 production now estimated at 8.6 million bales. (USDA Attach report)

Source: Telequote

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

valid for Jan 1, 2013 Support 965-975 16430-16490 Resistance 990-1000 16620-16740

Outlook
Cotton prices may open remain firm in the early part of the session. However, prices may again come under downside pressure as higher output expectations by Cotton Association of India has turned the sentiments negative for the cotton prices. In the coming weeks, sharp downside in the domestic markets is also limited as farmers will not sell their stocks at very low prices. Also demand remains strong at low prices.

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