May 19, 2020 RM seed/Maize/Chana/Turmeric Commodity Market Monitor Weekly Online https://forms.gle/2J Click on the link above to participate Participate in our weekly quiz and get a chance to win Amazon gift coupons. Winners will be announced in next report and rewarded.
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Commodity Market Monitor - NCML€¦ · Commodity – RM Seed ... However, with US jobs and initial jobless claims pointing to depreciation in greenback ... prices in the market are
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May 19, 2020
RM seed/Maize/Chana/Turmeric
Commodity Market
Monitor
Weekly Online
https://forms.gle/2J
gFGowMre4fxDwSA
Quizhttps://forms.g
le/LJdTxzEURqqTZA
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Click on the link above to participate Participate in our weekly quiz and get a chance to win Amazon gift coupons. Winners will
Pradesh, Uttarakhand and West Bengal states received the large excess rainfall
Jammu & Kashmir, Kerala, Meghalaya and Sikkim states received the normal rainfall
For the country as a whole, cumulative rainfall during 1stMarch 2020 to 06th May 2020 was above Long Period Average
(LPA) by 25% over the country as a whole.
Weather Forecast:
Gradually rise in maximum Temperatures 2-3°C very likely over north and adjoining Central India during next 2 days.
Maximum Temperatures likely to remain between 41-44°C over some parts of Madhya Maharashtra, Marathawada, Telangana, Rayalaseema and North Interior
Karnataka during next 2 days and between 43-45°C over Gujarat state during next 24 hours and gradually fall thereafter.
Scattered to fairly widespread rain/ thundershowers likely over East and Northeast India and isolated to scattered rain/ thundershowers over Northwest, south
peninsula and Central India. Gradually rise in maximum Temperatures 2-3°C very likely over north and adjoining Central India during next 2 days.
Maximum Temperatures likely to remain between 41-44°C over some parts of Madhya Maharashtra, Marathawada, Telangana, Rayalaseema and North Interior
Karnataka during next 2 days and between 43-45°C over Gujarat state during next 24 hours and gradually fall thereafter.
Scattered to fairly widespread rain/ thundershowers likely over East and Northeast India and isolated to scattered rain/
thundershowers over Northwest, south peninsula and Central India.
All India Reservoir Status: as on 06th May 2020.
Central Water Commission is monitoring live storage status of 123 reservoirs of
the country on weekly basis and is issuing weekly bulletin on every Thursday.
The total live storage capacity of these 123 reservoirs is 171.090 BCM which is
about 66.36% of the live storage capacity of 257.812 BCM which is estimated to
have been created in the country. As per reservoir storage bulletin dated
06.05.2020, live storage available in these reservoirs is 68.036 BCM, which is
40% of total live storage capacity of these reservoirs. However, last year the live
storage available in these reservoirs for the corresponding period was 41.680
BCM and the average of last 10 years live storage was 41.328 BCM. Thus, the
live storage available in 123 reservoirs as per 06.05.2020 Bulletin is 163% of the
live storage of corresponding period of last year and 159% of storage of average
of last ten years.
Source: IMD, DAC&FW and CWC
-100
-50
0
50
100
150
200
% of Departure From Normal Reservoir Storage (06th May, 2020)
The domestic RM seed and Mustard oil counters traded range bound with positive bias
amid good Rabi harvest and localized edible oil demand forming the undercurrent.
Consecutive year of good crop prospects continue to weigh on the broad trade
sentiment across RM seed and Mustard oil counters.
Meanwhile, domestic Rabi crop anticipated at 75 Lakh tons; ample availability in the near
term shall continue to weigh on the broad trade sentiment at the immediate front.
With NAFED buying aggressively across major production tracks and millers too active in
the market against their seasonal buying requirement; the RM seed counters found much
needed support to gain some ground thereby keeping the RM seed counters on a
Commodity – RM Seed
Fundamental Summary
Benchmark Location Jaipur
Market Outlook Bullish
Market driving factors
Factor Impact
Good crop prospects Bearish
Localized demand for Mustard oil Bullish
Positive gross Crush margins Bullish
US jobs and Initial claims infused weakness in USD Bullish
Price Recap
RM Seed, Jaipur
(INR/quintal)
Last Closing Week Ago Month Ago Year Ago
4468 4450 4308 3984
Price Outlook (2-4 weeks)
Time frame 2-3 weeks 2 – 4 months
Price Direction Bullish Bearish
Price Range (INR/Qtl) 4350 – 4560 4100 - 4600
Fundamental Analysis and Insights
buoyant note.
Riding on such gains in the RM seed and firm Mustard seed cake prices (riding on good
off-take by cattle feed industry); positive gross crush margins continue to lend lateral
support for Mustard oil counters thereby keeping the broad trade sentiment on a
buoyant note.
Meanwhile, international Sun and Soy oil counters find export competitiveness in
depreciating source markets currencies; thus enhancing the value for imports of these
premium oils. Such scenario for cheaper imports shall continue to keep domestic mustard
oil on a cautious note moving forward.
However, with US jobs and initial jobless claims pointing to depreciation in greenback
(USD); the same might reduce the export competitiveness for Soy oil moving forward.
However, supply tightness in Sun oil against immediate delivery at the Black Sea origin
might keep Sun oil quotes on a firm note.
Such higher cost of ownership of premium vegetable oils moving forward might lend
lateral support for Mustard oil counters in the near term.
However, higher RBO production in North India stemming out from higher paddy milling
against CMR milling; mustard oil might find competition with RBO in the hydrogenated
fat industry thus enhanced pressure moving forward.
Summing up, look for domestic mustard oil counters to trade sideways with extension of the
current corrective tone tracking higher landed cost of imported vegetable oils in the coming 2-3
weks’ timeframe.
Mustard seed Prices closed on a steady note at INR 4468 at Jaipur Markets.
Prices continue to raise towards the 61.8%
Fibonacci retracement levels keeping the
positive momentum in force.
Any gains from here shall find stiff resistance
near the Fibonacci retracement levels of INR
4560.
How-ever INR 4350 Acts as the immediate support for the prices.
Technical Analysis
Prices are likely to trade between INR 4560 to 4350 in the coming 2 - 3 weeks.
Mandi Price in Rs/ Quintal
Location 5/18/2020 5/11/2020 % Change
Jaipur 4468 4450 0.4
kota 3985 3860 3.2
Hapur 4200 4220 -0.5
Maize prices during the previous week closed week amidst higher Rabi production on
one side while subdued demand on the other side.
AGCON estimates Rabi Maize production for the season 2019-20 at 98 lakh MT, higher by
23 lakh MT on a year on year basis. Major increments have come from Bihar, the key Rabi
Maize production state wherein the state is estimated to produce a record 37.5 lakh MT
as against 28.5 lakh MT witnessed during last year.
Poultry feed sector is the largest consumer of Maize and this year amidst threat of spread
of corona virus, Poultry meat consumption has taken severe hit from Feb’20 till date. On
Commodity – Maize
Fundamental Summary
Benchmark Location Gulabbagh
Market Outlook Range bound to slightly firm
Market driving factors
Factor Impact
Higher Rabi Maize Production Bearish
Subdued demand from poultry feed segment Bearish
Rationalization of Maize acreages in Telangana
during upcoming Kharif season Bullish
Poor arrivals in Bihar amidst delayed harvesting Bullish
Price Recap
Maize, Gulabbagh
(INR/quintal)
Last Closing Week Ago Month Ago Year Ago
1211.50 1192.00 1716.50 1830.00
Price Outlook (2-4 weeks)
Time frame 2-3 weeks 2 – 4 months
Price Direction Bullish Bearish
Price Range (INR/Qtl) 1150 – 1300 1050 - 1350
Fundamental Analysis and Insights
the other hand, Broiler chick placements are lacklustre during May’20 wherin average
weekly broiler placements are 3 to 3.5 crore birds compared to 5.5 to 6 crore birds during
the same period last year.
Poultry layer farmers have culled the population during Mar and Apr’20 amidst huge
losses faced by them on the back depressed prices and poor lifting owing to lockdown.
Despite recovery in prices, placements have not improved. Lower birds’ placements led
to subdued Maize demand at the domestic front.
In one of the radical decisions, Honourable Chief Minister of Telangana, Mr K. Chandra
Sekhar has requested for rationalisation of cropping patterns in the state where in the
CM has appealed farmers not to go for Maize crop in the upcoming Kharif season and
further announced that the state will not procure maize at MSP. Instead, the CM has
appealed to take up Red gram instead of Maize. Tracking such decision, Maize acreages
in Telangana are expected to be significantly lower compared to previous Kharif season
and may provide support to the prices.
Arrivals of Maize crop in Bihar are very poor as sowing is delayed by a month. Besides,
lower prices, extended lockdown and Ramzan festival are the other reasons for lower
arrivals.
Exports enquiries of maize have been floating in the market mainly for SE Asia
destinations. Despite higher landing costs, enquiries are strong owing to lower transit
time and the poor availability from Brazil and Argentina on the back of lockdown. Only
ready demand is coming to India and for future months, SE Asian nations are depending
on S.American nations.
Further, super cyclone Amphan is expected to bring some rains into Bihar later this week
and further delay harvesting operations.
Procurement of maize at MSP of Rs 1760 per quintal in Andhra Pradesh and Telangana
states is lending support to maize prices in the near term. On the other hand, prevailing
prices in the market are way below MSP and are trading in the range of Rs 1450 to 1550
per quintal in these states. As on 17h May 2020, Andhra Pradesh state has procured more
than 1.5 lakh MT of Maize at MSP while Telangana has procured 2 lakh MT of Maize.