Turmeric futures (Sept) is expected to witness an extended downside & test 7800 levels. Domestic and export demand is dull in the spot markets since last few weeks, & the same is likely to continue in days to come. In the present situation, only 50% of the arrived turmeric bags are getting sold at Erode markets. Secondly, the figures of higher cultivation this season is also exerting pressure on the counter. Turmeric acreage in Telangana as on 10 Aug was up 14 % at 43,000 hectares as compared to 38,000 hectares last year. Area in Andhra Pradesh is also higher by more than 5%. The acreage of turmeric is higher compared to normal in both states.
The bull-run in cardamom futures (Sept) will possibly continue as it can test 1030 levels. It appears that buying interest among the market participants are increasing at a time when the supply will possibly show a declining trend following non-commencement of harvesting. Supply of quality material continued to remain squeezed and good colour capsules were fetching good price. On the supply side, this season, the crop is going to be less by 40 – 50% due to the dry spell and erratic rains.
Jeera futures (Sept) will possibly take support near 18000 levels & the downside may remain capped due to tight availability. It is estimated that only 12-13 lakh bags (55kg each) of cumin seed are left in the country as rest has been consumed either domestically or through exports against production of 50-55 lakh bags.
Coriander futures (Sept) is expected to trade sideways in the range of 7750-7950 levels. The arrivals & demand both are getting hampered due to heavy rainfall.
Soybean futures (Oct) is looking bearish & the downside may get extended towards 3520-3500 levels. The prospects have brightened for a good soybean harvest this year, aided by normal monsoon. In the current scenario, soybean is in the pod formation stage and the crop prospects are definitely better than last year. Soyabean has been planted on 111.83 lakh hectares (lh) this year, marginally higher than the previous year’s 110.71 lh. On the demand side, soymeal demand in local market continued to remain irregular as poultry farms are buying are per requirement, expecting prices to fall in new season on expectation of better than expected crop.
Mustard futures (Sept) will possibly trade with a downside bias in the range of 4800-4840 levels. Currently, mustard seed prices at the spot markets are largely pressured by slow demand for mustard oil. Demand for raw material has also slowed as crushing margin is in disparity of Rs 3,183 per tonne due to weak demand for by-products. In addition, mustard cake demand has also slowed due to high crushing during early start of season, due to which stock has piled up.
CPO futures (Sept) is expected to gain for the fourth consecutive week as it has the potential to test 540-545 levels in days to come. Refined soy oil futures (Oct) is likely to witness an upside momentum towards 655 levels. Edible oil prices at the spot market are drawing support on reports of low stocks at various ports of the country, whereas demand is improving ahead of festive season stocking. It is reported that the total palm oil stocks (CPO+RBD) has dropped to 1.35 lakh tonnes as on August 1 at various ports of the country, against 1.59 lakh tonne on July 25.
Kapas futures (Apr) is expected to trade with a downside bias in the & test 940 levels. At the spot markets, the cotton prices are declining on account of lackluster demand by mills. In the current scenario, many mills and spinners have opted to stay on the sidelines anticipating of further fall in price amid prospects of better crop in the country amid favorable weather. Also, imported cotton dealt earlier has also started to hit Indian ports are weighing on the counter. Further to it, the offtake in yarn is negligible at the moment in the midst of subdued exports demand coupled with availability of cheaper alternatives such as viscose fibres. Secondly, the cotton prices on the global markets are melting as China cotton market is exhibiting bearish tone after extension of state reserve auction up to September 30.
Mentha oil futures (Aug) may fall further towards 900-885 levels. The supply is abundant at the spot markets & demand is hand-to-mouth at present.
Guar seed (Oct) may witness a consolidation in the range of 3550-3650 levels, while guar gum (Oct) will possibly trade with a downside bias in the range of 6350-6650 levels. The sentiments have turned bearish due to strong selling amid expectations that sowing may improve after good rainfall in producing belts of Rajasthan and Haryana. The Govt of Rajasthan has declared the latest sowing data up to August 6 as per these data Guar has been cultivated on 20.42 lakh hectares, which is 56 percent of the target area. In Haryana, Guarseed has been cultivated at 2.61 lakh hectares against 3.67 lakh hectares last year.
Courtesy: Smc Comtrade