Sharekhan
Commodity Buzz
Sharekhan Comtrade
January 03, 2017
Sugar prices continue to rise on lower output
Agricultural sector highlights:
• Edible oil prices on the boil on good spot demand
• Saudi bans Indian poultry products due to bird flu
• Global black tea production up 2.78 percent in 2016
• Government to extend sops on onion exports till March 31
• Government allows 8424 tonnes raw sugar exports to US under Tariff-rate Quota (TRQ)
Cotton
Market Highlights
Overview
Daily Price Analysis
Expiry
Open
High
Low
Close
Prev Cl
% Change
JAN
19,350
19,570
19,350
19,550
19,330
1.14
FEB
19,560
19,740
19,550
19,730
19,490
1.23
MAR
19,700
19,910
19,700
19,890
19,630
1.32
APR
0
0
0
19,520
19,520
0.00
Cotton Jan futures gained for the sixth consecutive
session on Monday taking cues from procurement by CCI
coupled with tight domestic supplies and good demand
from China and settled 1.14% higher. However, weak
domestic demand, higher output expectations and lower
off takes capped sharp gains.
Cotton Advisory Board has forecast 2016-17 output 3.8%
up at 35.1 mn bales. Cotton Association of India pegged
output at 33.6 mn bales, unchanged compared with last
year. Favorable climatic conditions have lead to higher
output expectations this year.
Sowing of cotton stood 11.58% lower at 102.55 lakh ha
v/s 115.98 lakh ha during the corresponding period last
year.
Cotton futures remained closed on Monday on New Year
holiday. Prices gained last week on good export sales data
and a weak dollar. Good demand from China also supported
prices. Prices declined earlier on long liquidation and a
strong dollar. USDA WASDE report forecast higher end
stocks added to the downside. Prices gained earlier this
month on good export sales. Harvesting is complete at
77% v/s 67% last week.
Spread Matrix
Spread Analysis
PRICE
JAN
FEB
MAR
APR
SPOT
19,200
350
530
690
320
JAN
19,550
-
180
340
-30
FEB
19,730
-
-
160
-210
MAR
19,890
-
-
-
-370
APR
19,520
-
-
-
-
Stock position as on 31st Dec on NCDEX Warehouses
Location
Valid Stock
In Process
Unit
Rajkot
2100
0
Bales
Kadi
1100
0
Bales
Mundra
1600
0
Bales
Jalna
100
0
Bales
Yavatmal
1000
0
Bales
Total
5900
0
Bales
CCEA has kept MSP of cotton for medium staple and long staple variety unchanged at Rs. 3860 and Rs. 4160 per qtl
respectively.
Prices in Rajkot (BT cotton) traded at Rs. 4850-5500/qtl while Bhatinda traded at Rs. 4225/maund. (Source: Agriwatch)
The Ministry of Agriculture released 4th Advance Estimates for 2015-16, wherein it has estimated cotton output at
301.47 lakh bales compared with 348.05 lakh bales last year.
Total stocks on MCX accredited warehouses stand at 5,900 bales out of which 5,900 bales are valid stocks while 0
bales are in process.
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January 03, 2017
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Outlook
Cotton may trade on a positive note. Procurement by CCI at market prices, lower arrivals and demand for good
quality crop may continue to support prices. However, weak demand from textile industry and higher output
expectations markets may cap sharp gains. Overnight gains on the ICE may also support prices.
Market Highlights
Jeera
Overview
Daily Price Analysis
Expiry
Open
High
Low
Close
Prev Cl
% Change
JAN
17,890
18,210
17,885
18,185
17,810
2.11
MAR
16,520
16,800
16,505
16,780
16,375
2.47
APR
16,400
16,650
16,400
16,615
16,295
1.96
MAY
19,205
19,205
16,230
16,730
16,365
2.23
Jeera January gained 2.11% on Monday on tight supplies
and good demand from the overseas markets. Lower
stocks on exchange warehouses also supported prices.
However, higher sowing of the new crop coupled with
favorable climatic conditions capped sharp gains.
Jeera sowing in Gujarat is complete at 2,56,800 ha vs
2,43,000 ha last year.
Prices in Delhi spot gained to Rs. 18,500 for Ganesh
variety. Prices in Jodhpur fell to Rs. 15,200-17,400.
(Source: Agriwatch)
The geopolitical tensions in Syria and Turkey are likely
to hit supplies from the exporting nations. Sowing in
Gujarat in 2015-16 was up 10.76% higher at 295,400 ha
compared with 266,700 ha last year.
Prices gained sharply earlier last year on lower acreage,
lower domestic supplies due to record exports and
lower carryover stocks. Unseasonal rains damaged the
crop leading to further upside in the prices. Output in
2014-15 is expected around 43 lakh bags (of 55 kg each),
much lower compared with last year.
Spread Matrix
Spread Analysis
PRICE
JAN
MAR
APR
MAY
SPOT
18,200
-15
-1,420
-1,585
-1,470
JAN
18,185
-
-1,405
-1,570
-1,455
MAR
16,780
-
-
-165
-50
APR
16,615
-
-
-
115
MAY
16,730
-
-
-
-
Stock position as on 1st Jan on NCDEX Warehouses
Valid Stock
In Process
Unit
Unjha
Location
12
0
MT
Total
12
0
MT
According to the Spices Board of India, exports of Jeera from India between April-June 2016 stood at 41,000 MT, 55
percent higher compared with 26,529 MT during the corresponding period last year.
Total stocks on NCDEX accredited warehouses stand at 12 mt out of which 12 mt are valid stocks while 0 mt are in
process.
Outlook
Jeera may trade on a positive note. Tight supplies in the physical markets as well as increasing demand from the
overseas markets may support to the prices. However, higher sowing till date and favorable climatic conditions in
Gujarat this year may pressurize prices in the new crop contracts.
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January 03, 2017
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Market Highlights
Soybean
Daily Price Analysis
Expiry
Open
High
Low
Close
Prev Cl
% Change
JAN
3,034
3,082
3,029
3,068
3,029
1.29
FEB
3,080
3,134
3,080
3,115
3,078
1.20
MAR
3,138
3,188
3,138
3,167
3,132
1.12
APR
3,192
3,242
3,192
3,226
3,191
1.10
Overview
Soybean Jan gained 1.29% on Monday on good demand
from the oil and meal crushers. However, arrival pressure
and higher output this year capped sharp gains. SOPA has
revised output to 11.4 mn tn compared with 7 mn tn last
year. NCDEX has withdrawn addition 5% margin on long
and short sides.
Spread Matrix
Soybean on CBOT remained closed on Monday on New Year
holiday. Prices declined late last week on year-end profit
taking and good crop in South America. Prices gained
sharply earlier this week on good demand. Harvest in the
US also pressurized prices. USDA monthly report raised
the already record high yield and production estimates.
There are record output expectations due to favorable
climatic conditions and good crop conditions.
Spread Analysis
PRICE
JAN
FEB
MAR
APR
SPOT
3,091
-23
24
76
135
JAN
3,068
-
47
99
158
FEB
3,115
-
-
52
111
MAR
3,167
-
-
-
59
APR
3,226
-
-
-
-
Sowing of soybean stood 1.3% lower at 114.71 lakh ha
compared with 116.22 lakh ha during the corresponding
period last year.
Stock position as on 1st Jan on NCDEX Warehouses
Valid Stock
In Process
Unit
Akola
Location
76293
2685
MT
Indore
9178
40
MT
Kota
32739
20
MT
Latur
11584
669
MT
Mandsaur
7262
837
MT
Nagpur
1877
30
MT
Sagar
547
0
MT
Shujalpur
2608
0
MT
Vidisha
708
0
MT
142796
4281
MT
Total
According to SEA of India, Soymeal exports in October 2016
stood at 3177 tonnes. Exports between April- September
2016 declined 64.5% to 16,665 tonnes compared with
46,980 tonnes during the corresponding period last year.
Prices in Indore traded around Rs. 2800-3000. Prices in
Kota spot market traded around Rs. 2970-3030. (Source:
Agriwatch)
The Ministry of Agriculture released 3rd Advance
Estimates for 2015-16, wherein it has estimated soybean
8.92 mn tonnes compared with 9.1 mn tonnes in the 2nd Advance Estimates.
Total stocks on NCDEX accredited warehouses stand at 1,47,077 mt of which 1,42,796 mt are valid stocks while 4,281
mt are in process.
Outlook
Soybean may trade on a positive note. Demand from crushers and soya meal export demand may support prices.
However, arrival pressure, higher output and weak demand from bulk consumers due to demonetization may cap
sharp gains.
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January 03, 2017
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Commodity Buzz (agri-commodities)
January 03, 2017