Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities

Content
News & Market Highlights Chana Sugar Oilseed Complex Spices Complex Mentha Potato

Research Team
Vedika Narvekar - Sr. Research Analyst vedika.narveker@angelbroking.com (022) 2921 2000 Extn. 6130 Anuj Choudhary - Research Associate anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132

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Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities
News in brief
Monsoon deficit 15% with more than a month to go
Overall monsoon deficit has come down to 15 per cent with one-and-ahalf months left for the season to end. Incidentally, this is the final deficit figure that India Meteorological Department (IMD) expects the fourmonth season would leave behind. The situation is comfortable, relatively speaking, over Central India where the deficit has been brought down to single deficit (9%) as on Monday. Northwest India too managed to do considerable catching-up with the early push of the monsoon returning appreciable gains. The deficit here has since been brought down to 29% from the seasonal highs that ranged from of 40 to 50%. The situation over peninsular India too has undergone some change for the better, with the latest deficit figure reading 17%. East and northeast India, where the monsoon was initially active, seems to have suffered late reverses. The deficit here has risen to 13% lately from a low of six per cent. Meanwhile, a northwest Pacific storm, Kai-Tak, located just to the east of Philippines, is forecast to intensify into a typhoon (cyclone) and hit south China coast. This would expectedly trigger a monsoon rally along the west coast, with rains peaking over the north Kerala coast by Friday. (Source: Business Line)

Market Highlights (% change)

Last Prev. day

as on Aug 14, 2012

WoW MoM YoY

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

17728 5380 55.6 93.43 1599

0.54 0.61 0.47 0.75 -0.63

0.72 0.82 0.97 -0.26 -0.64

2.99 2.93 1.00 5.65 0.52

3.49 4.25 22.87 12.72 -10.21

Source: Reuters

Contingency Plans Ready for 320 Districts; Kharif Crops Sown in 802 Lakh Hectare
Ministry of Agriculture has prepared District Contingency Plans for 320 districts which have been uploaded on the website of Department of Agriculture & Cooperation. States have been advised to prepare location specific alternatives based on these Plans in consultation with respective State Agricultural Universities and arrange seeds of alternante crops/varieties to implement such plans. Due to deficient rainfall during South-West monsoon 2012, total Kharif area sown is 802.09 lakh hectares as against the normal of 854.86 lakh hectares as on 08.08.2012. There has been shortage of green and dry fodder, which is further aggravated due to deficient rainfall in several States. Ministry of Drinking Water & Sanitation has reported that States namely Maharashtra, Karnataka and Rajasthan are witnessing scarcity of drinking water. There is ready availability of funds with State Governments under SDRF to take immediate relief measures. (Source: PIB)

GDP cut means lower agri output; fisc deficit at 6%: CLSA
CLSA has cut GDP growth forecast for India this fiscal to 5.5% from 6% earlier, as a deficient monsoon compounds the misery of an economy already buffeted by high inflation, tight monetary policy, rising fiscal deficit and weakening currency. The GDP cut reflects the lower agriculture output this year, he told CNBC-TV18 in an interview. Finance minister P Chidambaram earlier outlined a plan to improve sentiment, but faces significant hurdles, notability the seeming inability to push through game changing reforms such as allowing FDI in multi-brand retail and reducing subsidies in diesel. He says poor monsoon will lower farm sector growth and accelerate inflation, making it much more difficult for the Reserve Bank of India to begin monetary easing. "We expect fiscal deficit at 6% of GDP in FY13," Malik says adding, inflation expectations till dont capture weak monsoons. Malik says we need to see if the new FM pressurizes the Reserve Bank to cut rates. (Source: CNBC)

Bringing Green Revolution in Eastern India Scheme Results in Rise in Rice Production
In order to address the constraints limiting the productivity of rice based cropping systems in eastern India, the Government launched a programme namely `Bringing Green Revolution in Eastern India (BGREI)` during the year 2010-11. It is a sub scheme of Rashtriya Krishi Vikas Yojana (RKVY) and is being implemented in seven States viz. Assam, Bihar, Chhattisgarh, Jharkhand, Odisha, Eastern Uttar Pradesh and West Bengal. The focused interventions under the programme through cluster demonstrations on improved technologies for different agro-ecological conditions of States are the integral part of the programme for reducing the yield gap. The production of rice increased substantially during 201112 over the previous years in majority of the States except Assam, Chhattisgarh and Odisha. (Source: PIB)

End-of-season rainfall to erase a part of drought's footprint

An unexpected surge in rainfall since the last week of July has soaked parched fields in many parts of the country and filled up depleted reservoirs, limiting the impact of drought-like conditions since June, although the government is still concerned about rising food prices. Rainfall has revived - ironically, after the weather office stopped issuing forecasts of a normal monsoon - significantly in oilseed-growing Madhya Pradesh, where seasonal rainfall is now above normal, while in Gujarat the deficit has narrowed to 48% from over 70% recently. The country's total monsoon deficit, which was an alarming 30% at the end of June, has gradually contracted to 15%. Parts of Karnataka, Maharashtra and Rajasthan are still dry, and face a shortage of drinking water. Agriculture Minister Sharad Pawar told Parliament on Tuesday that the Rajasthan and Karnataka governments have declared a drought in some parts of these states. (Source: The Economic Times)

Govt raises MSP of pulses, but below CACP's recommendation

The MSP of tur (arhar) and moong were revised to Rs 3,840 a quintal and Rs 4,400 a quintal, respectively, for 2012-13. Officials said CACP was asked to rework the MSP of pulses due to declining prices in the market and expectation of robust production, close to the 18.1mln tn(mt) last year. In addition, in anticipation of demand, there have been heavy imports. The earlier high prices had hit retail consumption, leaving a lot of stock in the market. Hence, supply was more than the demand, which eases price pressure. In this scenario, said sources, the high MSP suggested would create an inflated base. This would push up the burden on the exchequer, already facing strained financial conditions. It would create a high base for the decision on next years MSP, too. Hence, there was a need to rework it, they said. (Source: Business Standard)

Myanmar's Pulses Exports in June

Pulses export from Myanmar is up due to strong demand from India. Beans and pulses import surged by 2.3 per cent to 1,55,490 MTs during May as compared with the 1,51,929 MTs in same period during 2011. India is leading importer with 63% of total pulses export by Myanmar (i.e. 97,784 MT).Moreover, rise of 33 per cent also witnessed in total year-todate exports to 8,56,013 MT in year 2012 as compared with 6,45,915 MTs in 2011. However, the June exports are down from the total beans and pulses exports in May month of the year. (Source: Agriwatch)

IPOA Lowered Indonesian Palm Oil Export Estimate For 2012

The Indonesian Palm Oil Association (GAPKI) has lowered its palm oil export estimate to 17.59 million tons, down 0.41 million tons compared to its previous target due to feeble buying from China and Europe. Besides, Indonesian palm oil output is expected to be between 23 million and 25 million tons for the current year. (Source: Agriwatch)

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Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities
Chana
Chana September futures declined initially on improved rains in the past one week and fears of government intervention to curb the rising prices of essential commodities. However, prices bounced back towards the end as supplies continue to remain tight. Monsoon is seen recovering gradually in the month of August reveals the th latest report from IMD, wherein monsoon as on 14 August 2012 were seen 15% below normal. Central, southern and northwest region has received good rains in the last 2 weeks. This has aided sowing in the last one week. Also this may prove beneficial for the chana sowing. The Cabinet Committee on Economic Affairs approved the Minimum Support Prices (MSP) for Arhar (Tur) and Moong for 2012-13 season. The MSP for Arhar has been fixed at Rs.3850 per quintal and of Moong at Rs.4400 per quintal marking an increase of Rs.650 per quintal and Rs.900 per quintal respectively. Government released fourth advance estimates wherein it revised upward Chana output at 7.58 mn tn from 7.4 mn tonnes estimated in the third advance estimates and 8.22 mn tn in 2010-11.

Market Highlights
Unit Rs/qtl Rs/qtl Last 4900 4820 Prev day -0.53 0.29

as on Aug 14, 2012 % change WoW MoM -0.54 0.71 0.73 1.54 YoY 49.92 45.14

Chana Spot - NCDEX (Delhi) Chana- NCDEX Aug '12 Futures

Source: Reuters

Technical Chart - Chana

NCDEX Sept contract

Sowing progress and demand supply fundamentals

According to the Ministry of Agriculture 74.48 Lakh hectare area has th been planted under Kharif pulses as on 9 August, 2012 compared to 89.34 lakh hectare (ha) same period last year, a decline of 16.63% . Sowing is reported lower mainly in Rajasthan. Rajasthan Agriculture Department states that planted area under Kharif Pulses is down at 9.51 lakh hectares ha compared to 23.01 lakh ha same th period last year. (Dated 9 August, 2012). Acreage may remain lower on account of scanty rains. In Maharashtra, Kharif Pulses sowing is down by 6.3% at 18.63 lakh hectares. While in AP it is up by 7.4% at 5.7 lakh hectares. According to the Fourth advance estimates, Pulses output is pegged at 17.21 mn tn in 2011-12 compared with 18.24 mn tn produced in the year 2010-11. While Chana output in 2011-12 is estimated at 7.58 million tones, Tur is estimated at 2.65 million tones, Urad is estimated at 1.83 million tones, Moong is estimated at 1.71 million tones. As per the latest release, Ministry of Commerce & Industry revealed that 20.23 lakh tones of peas, 2.03 lakh tons of Chana, 4.32 lakh tons of Urad & Moong, 1.12 lakh tons of Masoor and 4.26 lakh tons of Tur has been imported by India during April11-March 12. India's consumption of pulses is on the rise with an annual growth of around 5% but production is seen lower, which may lead to increase in imports this year. However, rupee weakness may turn import costlier. Around 74% of Indian chickpea imports come from Australia.

Source: Telequote

Technical Outlook
Contract Chana Sept Futures Unit Rs./qtl

valid for Aug 16, 2012 Support 4830-4860 Resistance 4960-4985

Outlook
Chana prices may trade sideways with positive bias amid lower supplies and strong demand ahead of festive season. However, improved rains may cap sharp upside in the prices. In the medium term to long term, the trend remains positive as supplies may not be sufficient to meet the rising demand of the commodity. Also lower sowing of kharif pulses may support chana prices.

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Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities
Sugar
Sugar Spot along with the September futures contract settled lower on Tuesday as ISMA has pegged sugar output estimates at 25 mn tn, much above the consumption requirement. Also with additional allocation for the quarter July- September has led to increased supplies. Industry body has estimated 7 mn tn stocks for the new season beginning October 01, 2012 compared to 5.5 mn tn year ago. India may exports 2.53 mn tn sugar in 2012-13. India will likely produce 25 million tonne of sugar in 2012-13 factoring in dry spells in biggest producer Maharashtra as well as Karnataka. The Central Government has released additional 4 lakh ton of non-levy sugar for the month of August, 2012. With the earlier release of 45 lakh ton in June and 2.66 lakh ton in July the total 51.66 lakh ton non-levy sugar will be available. According to a circular issued by FMC a Minimum Initial Margin of 10% of the value of the contract or VaR based margin whichever is higher will be imposed on all running contracts and yet to be launched contracts of Sugar with effect from beginning of trading day Monday, Aug 06, 2012. In the international markets, Raw sugar futures on ICE closed lower for the 12th straight session on Wednesday, ending at an eight-week low Liffe white sugar as well as ICE raw sugar settled 1.2% and 0.15% lower Wednesday. With international prices trading at such low levels, the exports from India is not viable as domestic prices being quoted much higher.

Market Highlights
Unit Sugar Spot- NCDEX (Kolkata) Sugar M- NCDEX Aug '12 Futures Rs/qtl Last 3725

as on Aug 14, 2012 % Change Prev. day WoW -0.49 -4.85 MoM 9.24 YoY 23.75

Rs/qtl

3539

0.08

2.52

7.93

28.55

Source: Reuters

International Prices
Unit Sugar No 5- LiffeOct'12 Futures Sugar No 11-ICE Oct '12 Futures $/tonne $/tonne Last 565.3 450.89

as on Aug 15, 2012 % Change Prev day WoW -1.22 -0.15 -4.06 -3.79 MoM -14.08 -10.73 YoY -26.18 -30.32

Source: Reuters

Technical Chart - Sugar

NCDEX Sept contract

Domestic Production and Exports

As on 9 August, 2012, the area under sugarcane is estimated at 52.88 lakh ha, up from 50.59 lakh ha on same period a year ago. Despite of higher acreage, the producers body has estimated next years output lower at 25mn tn, down by 1mn tn compared to the current year. Sugar production in India the worlds second-biggest producer touched 26 million tonne since October 1, 2011. IMD has so far predicted normal rains in August. However, rains in the first week of august are still 1% below average. If monsoon recover in the month of August, then there would not be much downward revision in the output and vice a versa. With the opening stocks of 7 mn tn, domestic Sugar supplies are estimated at 32mn tn against the domestic consumption of around 22.523 mln tn for 2012-13. Thus, no curbs on exports are seen as of now.
th

Source: Telequote

Technical Outlook
Contract Sugar Sept NCDEX Futures Unit Rs./qtl

valid for Aug 16, 2012 Support 3425-3438 Resistance 3490-3520

Global Sugar Updates

According to Unica, the 2012/13 sugarcane crop is seen at 596.6 mn tn, down 1 percent from the April estimate of 602.18 mn tn, according to the second estimate of the crop this season from the agriculture ministry's supply agency Conab. Despite the drop in the cane crop estimate from April, sugar output -- now forecast at 38.99 mn tn -- is virtually stable with the 38.85 million tonnes forecast four months ago. The global sugar surplus remains on target to fall in 2012/13 season, though declines will be less than previously suggested, while adverse weather in several producers may stop prices dropping far below recent levels. (Source: Reuters) According to the International Sugar Organization (ISO), the global sugar surplus is forecast to halve to around 3 mln tn in 2012/13 (OctoberSeptember) from a surplus of 6.5 million tonnes in 2011/12).

Outlook
Sugar prices are expected to trade on sideways to positive note in the intraday. Festive season demand and uncertainty over next years crop may support the upside in the prices. However, any action by the government to control the rising prices may lead to a correction. . Long term outlook for sugar would depend on the monsoon in the month of current and the September month and thereby output estimates for next season that will begin in October.

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Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities
Oilseeds Soybean: Soybean futures declined on account of higher soybean
acreage in India coupled with weak international markets. The Spot as well as the September futures settled 1.35% and 0.76% lower on Tuesday. India's oil meal exports fell to 2.75 lakh tn in July from 2.82 lakh tn a year earlier led by a sharp drop in the overseas sales of rapeseed meal. Soy meal exports rose to 1.68 lakh tn in July, from 1.39 tn a year ago. CBOT Soybean settled lower on Wednesday on forecast of more rains in US Midwest. Also, expectations of decline in the Chinese import at such high prices supported the downside. Showers and cooler temperatures will ease stress to pod- filling soybeans and may improve conditions and yield potential. According to the USDA Weekly crop progress report, the condition of Soybean has improved to 30% Good to Excellent from 29% a week ago. CBOT Soybean settled 3.14% lower on Monday. USDA released its monthly crop report wherein its cut U.S. 2012/13 soybean production forecast to 2.692 billion bushels, from 3.05 billion in July. th In the domestic markets, as on 9 August Oilseeds have been sown in 151.82 lakh hectares so far, compared with 157.9 lakh hectares same period last year. Soybean area is higher at 103.2 lakh hectares. In 2011-12 season, soybean was sown under 102.9 lakh hectares area and recorded 12.28 million tonne output, down from 12.73 mn tn in 2010-11 season. Indian acreage may touch record high levels this year as farmers have opted for this remunerative crop across India.

Market Highlights
Unit Soybean Spot- NCDEX (Indore) Soybean- NCDEX Aug'12 Futures Ref Soy oil SpotNCDEX(Indore) Ref Soyoil- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Rs/10 kgs Rs/10 kgs Last 4472 4532 776.4 780.1

as on Aug 14, 2012 % Change Prev day -1.35 -0.76 0.01 0.26 WoW -2.23 -4.23 -0.13 -0.04 MoM -4.16 -4.66 -1.46 -1.48 YoY 89.97 91.40 18.53 19.71

Source: Reuters

as on Aug 15, 2012 International Prices Soybean- CBOTAug'12 Futures Soybean Oil - CBOTAug'12 Futures Unit USc/ Bushel USc/lbs Last 1660 53.07 Prev day -1.21 0.45 WoW 1.83 2.89 MoM 0.67 -2.10
Source: Reuters

YoY 20.32 -7.38

Crude Palm Oil

% Change Unit
CPO-Bursa Malaysia Aug '12 Contract CPO-MCX- Aug '12 Futures

as on Aug 14, 2012

Last 2798 550.8

Prev day -0.67 -0.36

WoW -2.64 -1.38

MoM -8.02 -3.64

YoY -17.71 13.36

MYR/Tonne Rs/10 kg

Refined Soy Oil: NCDEX Soy Oil MCX CPO settled lower on Tuesday
due to higher stocks in Malaysia. Malaysia's July palm oil stocks rose 17.6 percent to 1,998,870 tn from a revised 1,699,117 tn in June. However, September Soy oil contract bounce back towards the end and settled higher by 0.55%. Malaysian palm oil Production has risen consistently since March 2012 and expected to go as high as 1.9 mn tn in September. On the other hand, exports have fallen 14.8 percent in July to below 1.23mn tonnes compared to 1.45mn tonnes a month ago due to a lull in Asian demand. Indonesia, the world's top palm oil producer, has lowered its earlier output forecast by 8 percent to 23.6 million tonnes this year India imported 124,125 tonnes of refined palm oil in June, down nearly 25 percent from May. Total vegetable oil imports in June were 783,315 tonnes, down 12.7 percent from 896,921 tonnes in the previous month, the data from the Solvent Extractors' Association (SEA) showed.

Source: Reuters

RM Seed
Unit RM Seed SpotNCDEX (Jaipur) RM Seed- NCDEX Aug '12 Futures Rs/100 kgs Rs/100 kgs Last 4306 4342 Prev day 0.96 0.14

as on Aug 14, 2012 WoW 0.72 0.12 MoM 1.07 1.12

Source: Reuters

YoY 48.47 50.45

Technical Chart Soybean

NCDEX Oct contract

Rape/mustard Seed: NCDEX September mustard seed prices

increased marginally by 0.12%. Mustard output this season has declined significantly and deficient rains in Rajasthan would not provide proper moisture for mustard sowing next season. This would keep the downside restricted. According to a circular issued by NCDEX, existing Special Cash Margin of 5% on the Long side shall be increased to 15% on all the running and yet to be launched contracts w.e.f beginning of 18/07/2012.

Source: Telequote

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

valid for Aug 16, 2012 Support 783-787 3910-3940 4355-4388 541-545 Resistance 794.50-800 4005-4045 4440-4470 552-556

Outlook
Soybean prices may trade sideways in the intraday. Downside pressure may persist on account of higher area under cultivation and expected higher yield of soybean due to good rains in MP. Nevertheless, sentiment remains cautious on possibility of an El Nino returning to Southeast Asia that could hamper output in top producers Indonesia and Malaysia.

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Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities
Black Pepper
Pepper Futures corrected on Tuesday on reducing demand for Indian pepper in the international markets due to huge parity. Many importers are preferring Brazil and Indonesia to India due to lower prices from them. The Spot as well as the Futures settled 0.84% and 2.19% lower on Tuesday. th According to the circular released on June 13 2012 the existing Special margin of 10% (cash) on the long side stands withdrawn on all running contracts and yet to be launched contracts in Pepper from beginning of day Friday June 15, 2012. Pepper prices in the international market are being quoted at $8,300/tonne(C&F) while Vietnam was offering its produce at $6,000/tonne for 500 GL. Brazil was offering its pepper at $6,150/tonne for the B-Asta grade. As per circular dt. 29/06/2012 issued by NCDEX, Hassan will be available as an additional delivery centre for all the yet to be launched contracts. (not applicable to the currently available contracts-till Dec 2012 expiry).

Market Highlights
% Change Unit Pepper SpotNCDEX (Kochi) Pepper- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 42767 44605 Prev day -0.84 -2.19

as on Aug 14, 2012 WoW 0.30 2.43 MoM 1.72 4.19 YoY 32.95 34.94

Source: Reuters

Technical Chart Black Pepper

NCDEX Sept contract

Exports
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 black pepper in 2012 are forecasted at around 1,25,000 tonnes. Exports of Pepper from Vietnam during January till June 2012 is estimated around 73000 mt 73,000 mt, higher by 4.3% in volume and 31.7% in value compared to corresponding year last year. Exports of Pepper from Brazil during January till May 2012 are estimated around 13369 mt. (Source: Peppertradeboard). Pepper imports by U.S. the largest consumer of the spice declined 14.8% in the first 2 months of the year (2012) to 8810 tn as compared to 10344 tn in the same period previous year. Imports of Pepper in the month of February declined by 16.8% to 3999 tn as compared to 4811 tn in the month of January 2012. 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. During May 2012 Brazil exported 1,705 tonnes of pepper as against 1600 tn in May 2011.

Source: Telequote

Technical Outlook
Contract Black Pepper NCDEX Sept Futures Unit Rs/qtl

valid for Aug 16, 2012 Support 43200-43410 Resistance 43940-44150

Production and Arrivals

Arrivals of pepper in domestic market stood at 16 tonnes while offtakes were 14 tonnes on Tuesday. Global Pepper production in 2012 is expected to increase 7.2% to 3.20 lakh tonnes as compared to 2.98 lakh tonnes in 2011 with sharp rise of 24% in Indonesian pepper output and in Vietnam by 10%. According to latest report pepper output in Vietnam is estimated to be 1.35 lakh tonne as compared to 1.10 lakh tonne estimated early in the beginning of year (2012). 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) On the other hand production of pepper in India in 2011-12 is expected to decline further by 5% to 43 thousand tonnes as compared to 48 thousand tonnes in the last year. Production is lowest in a decade.

Outlook
Pepper prices in the intraday trade sideways. Demand ahead of the festive season may support the prices at lower levels. Also, lower inventories are expected to support prices. However, lower demand for Indian Pepper in the international market may pressurize the prices.

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Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities
Jeera
Jeera Futures bounced back on Tuesday from lower levels due to lower arrivals as farmers are reluctant to sell their stocks at lower prices. Participants also expect export demand to increase at lower prices. Supply concerns from Syria and Turkey still exists. The Futures settled 1.71% higher on Tuesday. Expectations are that large export orders may be diverted to India from the international markets due to the ongoing civil war in Syria which is hampering supplies. Export demand from Bangladesh, Pakistan and other countries may support the prices at lower levels. Production in Syria and Turkey is being reported around 1,000 tonnes and around 5,000 tonnes, lesser than expectations. Jeera prices in the international market of Indian origin are being offered at $2,9503,000/tn (c&f) while Syria and Turkey are not offering their produce. Carryover stocks of jeera in the domestic market is expected to be around 7-8 lakh bags as compared to 4-5 lakh bags in the last year.

Market Highlights
Unit Jeera SpotNCDEX(Unjha) Jeera- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 16144 15623 Prev day 0.00 1.71

as on Aug 14, 2012 % Change WoW -1.90 -2.15 MoM 3.33 -1.31 YoY 3.99 1.84

Source: Reuters

Technical Chart Jeera

NCDEX Sept contract

Production, Arrivals and Exports

Unjha markets witnessed arrivals of 2,000 bags, 500 bags lower compared to previous day while off-takes stood at 2,00 bags on Tuesday. Production of jeera in 2011-12 is expected to be around 40 lakh bags as compared to 29 lakh bags in 2010-11 (each bag weighs 55 kgs). (Source: spot market traders). 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

Outlook
Jeera prices are expected to trade sideways to positive today. Prices may improve due to lower arrivals at lower prices. However, rains in Gujarat may cap any sharp upside. In the medium to long term (AugSeptember 2012) prices are likely to witness a bounce back as there are limited stocks with Syria and Turkey and crop there is 30% short as compared to last year.

Market Highlights
Prev day -0.35 3.12

as on Aug 14, 2012 % Change

Unit Turmeric SpotNCDEX (N'zmbad) Turmeric- NCDEX Aug '12 Futures Rs/qtl Rs/qtl

Last 5457 5690

WoW -4.44 -4.27

MoM 15.18 10.96

YoY -12.62 2.19

Turmeric
Turmeric prices opened higher on Tuesday but corrected towards the end of the day. The spot remained flat due to lack of orders from north India. Rainfall in Nizamabad is 29% lower than the normal as on 14/8/2012. Turmeric has been sown in 0.47 lakh hectares in A.P as on th 14 August 2012. The Spot settled lower by 0.35% while the Futures settled 3.12% higher (August) on Tuesday. As per circular issued by NCDEX, no fresh positions will be allowed in respect of Turmeric August 16, 2012 expiry contract from August 07, 2012 till the expiry of the contract. Only squaring up of existing positions will be allowed. The pre expiry margin on Turmeric has been increased to 5% for last 7 trading days increased on a daily basis on both buy and sell side from the existing 3% on daily basis for last 5 days.

Technical Chart Turmeric

NCDEX Sept contract

Production, Arrivals and Exports

Arrivals in Erode and Nizamabad mandi stood at 8,000 and 2,500 bags respectively on Tuesday. Turmeric production for the year 2011-12 is projected at historical high of 90 lakh bags (1 bag= 70 kgs) compared to 69 lakh bags in 201011. Erode is expected to produce 55 lakh bags of turmeric a rise of 29% as compared to previous year. 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.
Source: Telequote

Technical Outlook
Unit Jeera NCDEX Sept Futures Turmeric NCDEX Sept Futures Rs/qtl Rs/qtl

valid for Aug 16, 2012 Support 15800-15980 5680-5750 Resistance 16300-16480 5900-5980

Outlook
Turmeric prices are expected to continue to trade sideways. Reports of export demand from Pakistan may support the prices at lower levels. In the medium to long term (Aug to September) prices may take cues from the sowing figures.

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Commodities Daily Report

Thursday| August 16, 2012

Agricultural Commodities
Mentha Oil
Mentha oil Futures corrected on Tuesday on long liquidation due to reducing export demand. Gutkha ban led to lower demand in the domestic markets over the last couple of days. The spot settled 0.27% higher while the Futures settled 1.1% lower on Tuesday. Total Special Cash margin of 25% on the long side of Mentha Oil has been reduced to 10% in the May contract and 5% in June contract onwards from May 5, 2012. For detailed reference please refer to the Circular No: MCX/T&S/180/2012 dated 03/05/2012.

Market Highlights
Unit Mentha Oil- MCX Spot (Chandausi) Mentha Oil MCX July Futures Rs/qtl Rs/qtl Last 1533 1334 Prev day 0.27 -1.10

as on Aug 14, 2012 % Change WoW 0.93 -1.92 MoM 3.58 -0.60 YoY 24.88 8.69

Production, Arrivals and Exports

According to spot market sources, the overall acreage is estimated to increase from 1.75 lakh ha to 2.1 lakh ha this year. The overall production of Mentha is expected to increase by 30% - 40% as compared to last year. Arrivals of the fresh crop are going on in the mandis and currently stand around 1200 drums (each drum weighs 180 kgs). Exports of Mentha during April 2011 to January 2012 witnessed a decline of 6% to 12,850 tonnes as compared to 13,550 tonnes in the same period last year.

Source: Reuters

Technical Chart Mentha Oil

MCX Aug contract

Outlook
In the intraday trading session Mentha oil is expected to trade sideways. Lower export demand may pressurize prices. However, buying at lower levels may emerge from stockists anticipating good demand from pharmaceutical companies in the coming days. In long to medium term (July-September) prices are likely to remain under pressure due to peak arrival period.

Source: Telequote

Market Highlights

as on Aug 14, 2012 % Change Prev day -0.63 0.00

Potato
Potato September futures closed 1.91% up owing to short coverings by market participants. Commodity market regulator Forward Markets Commission (FMC) has banned launch of new Tarkeshwar potato contracts. Also From 01-08-2012 no fresh positions shall be allowed during the Staggered Delivery period in all running contracts of Potato in MCX and NCDEX. Only squaring off of existing positions will be allowed during the Staggered Delivery period.
Unit Potato SpotNCDEX (Agra) Potato- NCDEX Aug '12 Futures Rs/qtl Rs/qtl Last 1157 1177

WoW -2.63 -0.35

MoM 5.82 0.79

YoY 171.79 195.36

Production and Arrivals Scenario

Around 200-220 lakh MT potato had been stored in the country in different cold storages during the current season. Although 27-30% of the cold storage stocks are released so far from overall producing belts, they are much lower compared to normal 35-38% every year. According to NHRDF, The sowing of potato seed for Kharif production in Karnataka completed but the area sown is adversely affected due to less and delayed rains. The sowing in hills of Himachal Pradesh, Uttarakhand and Jammu and Kashmir are also completed. The seed sowing in Maharashtra for Kharif is continued, which is delayed due to delay arrival of monsoon, which is still scanty. The area for Kharif is expected to be less or may be same with delayed planting compared to last year, but it depends on further rains. With reports of crop damages in Karnataka, the supplies from this region to other states may also be affected as the overall output is expected to decline by 70-75%. In fact, the state may have to rely on the supplies from the north Indian markets.

Technical Chart Potato

NCDEX Sept contract

Source: Telequote

Technical Outlook
Unit Mentha Oil Aug Futures Potato NCDEX Sept Futures Potato MCX Sept Futures Rs/kg Rs/qtl Rs/qtl

valid for Aug 16, 2012 Support 1308-1320 1170-1188 1208-1225 Resistance 1350-1361 1220-1238 1265-1280

Outlook
Potato futures in intraday may trade sideways, on lack of fresh fundamentals to trigger the prices, also the participants fear that the government may take some measures to curb the rising prices. Upcoming festive season might provide support to the prices in Medium term.

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