NCDEX Turmeric market under long liquidation

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Turmeric on NCDEX settled down by -3.78% at 7428 on weak spot demand and good health of new season crop in South Indian states. Turmeric acreage in Telangana as on 17 Aug was up 15.4 % at 45,000 hectares as compared to 39,000 hectares last year. Sowing of turmeric is over in 93 per cent of normal area and up by 110 % of normal sowing area.

As per dept of commerce data, turmeric exports in April- May 2016 increased by 31% compared to last year at 21,256 tonnes. In 2015-16, 85,426 tonnes exported compared to 90,738 tonnes in 2014-15. As per market sources, production year 2015-16 started with carry-forward stocks of 1.4 lakh tonnes compared to 2.1 lakh tonnes in 2014-15.

The consecutive back-to-back droughts in India have impacted turmeric production in 2014-15 and 2015-16. India produced 2.52 lakh tonnes of turmeric in 2015-16, lower by 15 per cent than the previous year. Spot turmeric prices decreased at Erode markets for want of demand.  Such decrease is due to the very poor upcountry demand for the turmeric. For the past two months the traders have not received good number of orders from North India.

At the Erode Turmeric Merchants Association, the finger variety was sold at Rs. 7,599-9,099 a quintal; the root variety at Rs. 7,489-8,091. Of the arrival of 2,198 bags, 50 per cent were sold. In Nizamabad, a major spot market in AP, the price ended at 8133.3 rupees gained 15.25 rupees. Technically market is under long liquidation as market has witnessed drop in open interest by -0.08% to settled at 25310 while prices down -292 rupee, now Turmeric is getting support at 7308 and below same could see a test of 7186 level, and resistance is now likely to be seen at 7656, a move above could see prices testing 7882.

Trading Ideas:
–Turmeric trading range for the day is 7186-7882.
–Turmeric prices dropped on weak spot demand and good health of new season crop in South Indian states.
–Turmeric acreage in Telangana as on 17 Aug was up 15.4 % at 45,000 hectares as compared to 39,000 hectares last year.
–NCDEX accredited warehouses turmeric stocks gained by 968 tonnes to 7481 tonnes.
–In Nizamabad, a major spot market in AP, the price ended at 8133.3 rupees gained 15.25 rupees.

Courtesy: Kedia Commodities

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