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Chilli Update

posted Jul 17, 2011, 1:19 AM by NAVYUG Info

Chilli rose last week due to fresh buying by the traders and on rising demand from the domestic market. Hopes of pick up by the export enquiries also supported the uptrend.


As per last update, spot market prices traded near Rs 7800 per quintal and fresh arrivals were reported near 23000 bags compared with 35000 bags in the previous day. As per market sources, total stock in Guntur is expected around 47-48 lakh bags, out of this quality produce is expected around 30-35 lakh bags.


As per Andhra Pradesh government estimates as quoted in the media, the Chilli sowing shows a declining trend and major production belts received moderate rainfall. It is 17 percent less than previous year.

Jeera Update

posted Jul 17, 2011, 1:12 AM by NAVYUG Info

Jeera has been firm on low arrivals amidst rising export demand. Traders expect the short term trend to remain volatile with the demand and arrival figures determining the market trend. However, medium term outlook looks firm on expected rise in further demand.


Reports of adverse weather conditions in other major producers like Turkey and Syria have created apprehensions of lower output there and a possibility of delayed arrivals, originally scheduled from end-June onwards. Syrian production expected at 40000 tonnes and that in Turkey lower at 12-15000 tonnes. Indian production expected at 28-30 lakh bags translating to more than 1.5 lakh tonnes. Higher acreage expected in Gujarat and Rajasthan due to good moisture content in the soil.


Better Indian quality and availability of stocks could shift the Gulf demand ahead of Ramzan towards India in the coming weeks. Export demand from US and EU could also rise at these lower levels in coming weeks and that could have a moderate bullish impact on the prices.


Latest reports from Spice Board of India indicates the estimated exports of Spices for the period April-March 2010-11 have risen by 5% from 502,750 MT in 2009-10 to 525,750 MT in 2010-11. Jeera exports fell by 35% from 49,750 MT to 32,500 MT during the same period.

Turmeric Update

posted Jul 17, 2011, 1:09 AM by NAVYUG Info

Turmeric traded sideways in previous week in absence of fresh Fundamental factors as reports of good sowing activities kept pressure on the prices. Reports of rains in growing areas in Andhra Pradesh kept sentiments down. Low demand and reports of higher production and stocks in mandis are likely to pressurize the turmeric prices to some extent. 


Sowing has started in the growing areas in Andhra Pradesh and the progress is reportedly satisfactory. Good Monsoon progress is also reportedly keeping the sowing activities proper. The area sown would however depend on the market rates and if the falling trend continues, traders expect the sowing area may fall as farmers may shift to other lucrative crops like cotton, soybean etc. The present 2010-11 crop is expected higher at 65-70 lakh bags vs 48 lakh bags the earlier year. Good stocks and increased selling pressure along with weak demand in the mandis have kept trend weak for the commodity over the last few weeks. The sowing period is from June-August and harvesting begins in January.


There are expectations however of demand rising in coming weeks that could support the falling prices. Exports that had remained low are expected to rise in coming weeks from Europe, US, West Asia and Japan. That could support the falling prices to some extent.


Latest reports from Spice Board of India indicates the expected Turmeric exports for the period April-March 2010-11 have fallen by 3% to 49,250 MT in 2010-11 from 50,750 MT in 2009-10 same period.

Will India turn into a cotton importer?

posted Jul 12, 2011, 2:55 AM by NAVYUG Info

India may turn into an importer of Cotton if the domestic textile industry grows by 15-20% a year until the current capacity doubles, says B.K.Mishra, Managing Director Cotton Corporation of India. However he ruled out the possibility of the same happening over a year or two.


Mechanisation of farm holdings in India and employing machines to pick cotton is not feasible as most holdings are small and owned by individual farmers who may not have the sufficient financial muscle to bring in machines, added Mishra. R.C. Jain, Chairman and Managing Director of TT Limited--an integrated textile company--concurs Mishra’s view, but disagrees that India may turn into an importer. Textiles also include polyesters and there is a shift from cotton to polyesters by customers, R.C. Jain says. “Besides, cotton acreage and productivity is also increasing.” he argues.


As per the Ministry of Agriculture, cotton has been sown on 21.65 lakh hectares of land as on June 17 as compared to 15.42 lakh hectares last year. But cotton supply scenario in India is already constrained. Cotton Advisory Board expects the closing stock to be 27.5 lakh bales by the end of current season which will last only for a little over a month given the average monthly consumption of 22 lakh bales by textile mills in India. Cotton year runs from October to September in India with arrivals beginning only in January. Cotton Corporation of India (CCI) reported 30.2 million bales of cotton arrival as of June 19th, 2011 amounting to mere 4% increase over the last year. For 2009-10, India’s cotton consumption stood at 230 lakh bales which increased to 258 lakh bales in 2010-11.


“The domestic textile industry is one of the largest industries in the country and has witnessed a phenomenal growth in the last two decades in terms of installed spindlage and yarn production. The significant features of this growth include installation of open-end rotors and setting up of export-oriented units. The mushroom growth of spinning industry and its modernization has led to sustained growth in cotton consumption specially during the years when country harvested good crop production.” says Cotton Corporation of India website.


After achieving a sustained growth in cotton consumption during Xth Plan period, domestic cotton consumption in last few years barring 2008-09 has been increasing steadily.

Pulse demand set to soar at the onset of monsoon

posted Jun 28, 2011, 9:43 AM by NAVYUG Info

Pulses prices continued to show mixed trend in the physical markets with scattered demand. However, at the consumer end the demand for pulses, particularly chana, has increased because of decreased availability and higher prices of vegetables due to monsoons. International sentiments however continue to remain supportive for pulses with expected decline in acreage under pulses in Canada and US.


Urad prices remained firm on Monday across the country due to increased demand in the local markets. The prices gained Rs 20 – Rs 40 as there was a moderate decrease in arrivals which kept the sentiments firm. The offtake also improved in some of the centers which supported the prices. The prices of urad are expected to remain marginally weak in the range of Rs 3900 – Rs 4250 per quintal, for coming days as summer crop arrivals are expected to further increase in coming days. Overseas arrivals will also arrive soon which will further impact the prices.


Moong prices featured steady to firm trend on Monday due to improved trading interest by traders and millers. It was noticed that the sellers were not willing to lower the quotes and the demand also showed improvement in the markets. The prices of moong are expected to react sideways down in the range of Rs 3450 – Rs 4250 for coming days due to higher production of moong expected across the country as against previous year. Adequate stocks along with better production for moong in the country will contain the future increase in the moong prices.


India may lift ban on rice, wheat export

posted Jun 16, 2011, 1:09 AM by NAVYUG Info

India’s Agriculture minister Sharad Pawar reiterated his stand of lifting the ban on select commodities like non-basmati rice, sugar and wheat. Speaking to media men here he said it will benefit farmers and also on the fact that the country has surplus stocks and is likely heading to another year of a bumper output. With a record cereal crop estimated in the current year Pawar said there should be an open policy for export and import of agriculture commodities.


India's foodgrain stocks are at an all-time high of 65.47 million metric tons, about two-and-a-half times more than the annual requirement for state welfare programs. Still, the government is cautious on exports due to fear of worsening already high inflation and its plan to enact a law that seeks to expand the supply of subsidized grains. The country is also facing a shortage of storage facilities, with its warehouses already full. Production of farm commodities like sugar, wheat and cotton is expected to exceed local requirements, weakening their local prices as only limited or no exports are allowed.


Pawar said the time is right to immediately allow exports of 1.0 million-1.5 million tons of sugar as global prices have surged due to concerns over the crop in Brazil, the largest producer of the sweetener. India allowed exports of 500,000 tons of sugar in April. Mills have already almost exhausted the quota and want clearance to ship another 1.5 million tons in the marketing year through September. The minister said sugarcane acreage and output in the next marketing year are expected to rise at least 10% as higher local prices earlier in the year have tempted farmers to increase plantings. India, the second-biggest sugar producer, is forecast to produce 24.5 million tons of sugar this year, exceeding its annual requirement of 22.0 million-22.5 million tons.


On cotton, Pawar said the acreage is expected to jump 40% next year starting July 1, and so the government can consider more exports.

Turmeric May Decline on Production Estimates

posted Jun 14, 2011, 8:22 AM by NAVYUG Info

Sideways trend was noted in the mandis as moderately weak sentiments continued to prevail amidst reports of higher production and stock in the mandis.

Sowing has started in the growing areas in Andhra Pradesh and the progress is reportedly satisfactory. Good Monsoon progress is also reportedly keeping the sowing activities proper. The area sown would however depend on the market rates and if the falling trend continues, traders expect the sowing area may fall as farmers may shift to other lucrative crops like cotton, soybean etc.

The present 2010-11 crop is expected higher at 65-70 lakh bags vs 48 lakh bags the earlier year. Good stocks and increased selling pressure along with weak demand in the mandis have kept trend weak for the commodity over the last few weeks.  The sowing period is from June-August and harvesting begins in January.

Exports that had remained low are however expected to rise in coming weeks from Europe, US, West Asia and Japan. That could support the falling prices to some extent. Latest reports from Spice Board of India indicates the expected Turmeric exports for the period April-March 2010-11 have fallen by 3% to 49,250 MT in 2010-11 from 50,750 MT in 2009-10 same period.

USDA Grains Report

posted Jun 10, 2011, 10:00 AM by NAVYUG Info

Corn prices hit an all-time high following the release of the USDA's much anticipated June WASDE report yesterday. Revisions made in the USDA report were very supportive for corn prices – a 1.5mn decline in US corn-planted area (from 92.2mn acres to 90.7mn acres) while the harvested area was estimated at almost 2mn acres lower; US 2011-12 ending stocks were lowered to 695mn bushels, taking them below 2010-11's low levels while a significant upward revision of 12mn tonnes was made to China's corn demand which the USDA noted would be met by drawing down domestic stocks.

All this paints a very supportive backdrop for corn prices and with balances tightening further, upside risks from current elevated levels remains. The USDA kept its estimate of the US corn yield unchanged from May's report – at 158.7 bushels/acre – and, this could provide the next bullish impetus to prices. Global corn stocks to use ratios are estimated at record lows.

The report was less positive for wheat and soybeans. While EU wheat production was revised down after a dry spring, global production remains comfortable while estimates of US Hard Red Winter Wheat came in above market expectations. Soybean planted area in the US was unchanged while 2010-11 US ending stocks were revised higher; 2011-12 US exports were lowered and ending stocks revised higher while Southern Hemisphere production was also upwardly revised.

Price action across the grains will be driven by corn over coming months where market balances are very tight. High corn prices bode well for wheat feed demand especially as there is no shortage in feed grade varieties. For soybeans, US plantings and harvested area could change over coming months with a longer planting window than corn.

Cotton export enhancement shocks Indian spinning sector

posted Jun 10, 2011, 3:17 AM by NAVYUG Info

Cotton export enhancement by one million bales this season has shocked the Indian cotton spinning sector.

Coimbatore-based The Southern India Mills’ Association in a statement today, June 9th has expressed dissatisfaction with the recent Indian government’s decision to cap the cotton export this season at 6.5 million bales of 170 kg each instead of 5.5 million bales. Government of India on June 8th decided to increase this year’s cotton export by one million bales (170 kg each).


J Thulasidharan, Chairman of SIMA has stated that the government has earlier assured to maintain a closing balance of 5 million bales. With the enhanced export limit, the closing stock this year will come down to 1.75 million bales. In a statement, SIMA Chief has criticized India’s Agriculture Ministry for over estimating this year’s crop to be 33.9 million bales. SIMA is backing an estimate of 31 million bales, which is less than the Agriculture Ministry’s estimate. SIMA has pleaded the Indian government to reconsider its June 8th decision to allow more cotton export from India.

Oilmeals export from India surges by 84% in May

posted Jun 7, 2011, 9:06 AM by NAVYUG Info

The export of oilmeals from India during May 2011 has gone up by 84.48% to 320,266 tonnes. In May 2010, India had exported 173,604 tonnes of oilmeals. The export of oilmeals during April-May 2011 has more than doubled and reported 821,763 tonnes compared to 377,950 tonnes during the same period last year, according to a report released by Solvent Extractors' Association of India (SEA) on Tuesday. 

During current oil year 2010-11 (November 2010 to May 2011) export of oilmeals increased continuously due to a sharp increase in oilseed production to 30.25 million tonnes in current year (2010-11) compared to 24.88 million tonnes in previous year (2009-10). Increased availability of oilseeds lead to higher crushing and production of oil and meals for domestic and export and thirdly, good crushing parity due to high price of oils and export demand for oilmeals following SEA delegation visit to China in April 2011. 

The export from Kandla is reported at 404,831 tonnes (49%), followed by Mumbai including JNPT handled 171,000 tonnes (21%), Mundra which handled 167,441 (20%). Bedi handled 52,155 tonnes (6%), Vizag handled 17,100 tonnes (2%) and Kolkata handled 7,0202 tonnes (1%). 

Oilmeal import by Japan from India during April-May 2011 has more than tripled and reported at 205,726 tonnes compared to 48,887 tonnes ast year consisting of 200,323 tonnes of soybean meal and 5403 tonnes of rapeseed meal. Vitenam imported 110,072 tonnes compared to 41,853 tonnes last year consisting of 95,076 tonnes of soybean meal, 7,976 tonnes of rapeseed meal and entire quantity of 7,020 tonnes of rice bran extraction. 

China imported 138,483 tonnes of groundnut meal and 1,391 tonnes of soybean meal. South Korea imported 110,776 tonnes compared to 88,012 tonnes in last year. Europe has imported about 43,774 tonnes compared to 579 tonnes in last year.

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