Commodities Daily Report

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Thursday | 12 Sept, 2013
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Agricultural Commodities

Content
News & Market Highlights Chana Oilseeds Edible Oils Spices Sugar Cotton Guar Complex

Research Team
Vedika Narvekar Chief Manager- Agri Commodities vedika.narvekar@angelbroking.com (022) 2921 2000 Extn. 6130 Shruti Ghanekar Research Associate shruti.ghanekar@angelbroking.com (022) 2921 2000 Extn. 6133 Anuj Choudhary Research Analyst anuj.choudhary@angelbroking.com (022) 2921 2000 Extn. 6132

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Commodities Daily Report

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Thursday | 12 Sept, 2013
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Agricultural Commodities
NEWS HIGHLIGHTS Market Highlights (% change)
Oilseeds output set to rebound on higher acreage in groundnut, soya
Oilseeds production is set to rebound this kharif season but the jury is still out if it can scale higher than the record 219.22 lakh tonnes (lt) achieved during 2010-11. Soyabean and groundnut production will be higher this year. But we are not sure if it can touch the high that we saw three years ago, said Govindlal G. Patel, a renowned crop statistician. Going by the acreage, it is clear that we will have a higher crop this kharif, said B.V. Mehta, Executive Director of the Solvent E xtractors Association of India. According to the Ministry of Agriculture, till September 6, oilseeds have been planted on 191.6 lakh hectares (lh) against 117.6 lh during the same period a year ago. But as in the caseof other kharif crops, excess rain could affect the final output since damage to crops has been reported from some areas of the country. (Source:
Business Line) Last Prev. day

as on Sept 11, 2013

WoW MoM YoY

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

19997 5913 63.28 107.56 1363.9

0.00 0.28 -0.89 0.16 -0.01

9.67 10.70 -6.45 -0.90 -3.41

6.43 6.24 4.19 4.02 4.06

12.01 9.71 14.51 10.69 -21.24

.Source: Reuters

Sugar output to peak, set to worsen glut

Sugar production in India, the world's second-biggest grower, may be more than estimated as the highest monsoon rainfall in 19 years boosts yields hurt by a drought a year earlier, a growers' group said. The harvest will total 24.5 million tonnes in the 12 months starting Oct. 1, compared with 23 million tons predicted in March, Vinay Kumar, managing director of National Federation Cooperative Sugar Factories Ltd., said in a phone interview. That compares with a crop of 25 million tons this year and more than the 23.5 million needed to meet domestic demand, he said. Output may total 23.7 million tons in 2013-2014, the Indian Sugar Mills Association estimates. Futures are headed for a third-year of losses, the longest slump since 1992, as the world heads for a fourth year of surplus in 2013-2014. Worldwide supplies will outpace demand by 4.5 million tons in the season that starts in October, following a 10.3 million-ton surplus this season, the International Sugar Organization said Aug. 22.
(Source: Business Standard)

UP sugar mills: Rs 3K cr loss in marketing year 2012-13

Sugar mills in Uttar Pradesh have incurred a loss of about Rs 3,000 crore in 2012-13 marketing year ending this month due to higher cost of production and have demanded that state government should link the sugarcane rates with sugar prices to help the industry survive. The losses to sugar mills have also resulted in cane price arrears to farmers of about Rs 3,000 crore, an industry body said. The UP sugar millers have also shown their inability to pay more than Rs 240 per quintal in the 2013-14 marketing year starting next month as against the current years sugarcane price of Rs 280 per quintal for the state. In a letter to the UP Cane Commissioner, the UP Sugar Mills Association, part of Indian Sugar Mills Association, has pointed out that sugar mills in UP achieved an average sales realisation of about Rs 3,200 per quintal during the current 2012-13 marketing year (October-September) against the cost of production of Rs 3,600 per quintal. The overall loss to the industry for the current year would be more than Rs 3000 crore including the cooperative sector after taking into account the sugar mills realisation from byproducts such as molasses, bagasse and pressmud, it added. (Source:
Business Line)

Levying 10% export duty on surplus cotton likely to be discussed

The government might on Thursday discuss a proposal to impose 10 per cent tax on cotton exports above the declared surplus, to streamline exports and ensure a stable price regime. Officials said the proposal, floated by the textiles ministry, had recommended imposing the duty on the freight on board value or a maximum of Rs 10,000 a tonne, whichever is less, for all cotton exports over the declared exportable surplus. Other proposals included declaring exportable surplus in September every year, based on the estimates of the Cotton Advisory Board. The ministry was also for registration of cotton export contracts with the directorate general of foreign trade, to monitor the exports. The ministry wanted an inter-ministerial group to review the cotton position and make recommendations to vary or suspend the duty. However, the agriculture department was against the proposal. The department of agriculture is clear that any sort of curb on export of farm commodity hurts the interest of growers, a top official said. (Source: Business Standard)

Wheat exports to fetch $600 million this year

With a 150 per cent excess foodgrain stock, Food Corporation of India (FCI) has decided to export two million tonnes of wheat this financial year. Doing so would get it $600 million (Rs 3,800 crore). The food ministry and the Cabinet Committee on Economic Affairs (CCEA) have approved the move. FCI, the governments foodgrain procurement and distribution agency, similarly sold 4.2 mt of wheat in two lots during 2012-13. The coming export would create space for the new crop, set to hit the market in a couple of weeks. And, thered be an inflow of foreign currency, needed to protect the rupee from further depreciation. We will float global tenders soon to initiate the process, said an FCI official. A committee headed by FCI Chairman and Managing Director C Viswanath will meet soon to finalise the formalities. (Source: Business
Standard)

Weak rupee cuts India's August vegetable oil imports by a fifth

India's vegetable oil imports likely fell nearly 20 percent in August from a month ago as the weak rupee made purchases more expensive, a Reuters survey showed, bringing some small relief on the economic front to the government. India is the world's biggest buyer of vegetable oils and its imports cost around $10 billion last fiscal year - about 2 percent of the total value of Indian imports. New Delhi needs to curb imports as the steep fall in the rupee hikes costs and swells its current account deficit. The rupee lost about 16 percent in value between June 1 and Aug. 31, hiking prices of dollar-denominated imported vegetable oils. At the same time, a heavy monsoon means there should be ample local supply, cutting dependence on imports. (Source: Reuters)

Assam to increase onion production

Assam has been selected as one of the six states by the central government to increase the production of onion and the state's agriculture department has taken a new initiative to substantially push onion production in the state. Assam chief minister Tarun Gogi recently reviewed the progress of activities of the agriculture and irrigation departments at a meeting and issued the directive to go on a 'mission mode' for onion production. (Source: Business Standard)

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Thursday | 12 Sept, 2013
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Agricultural Commodities
Chana
After declining over the past few sessions, chana futures recovered from lower levels on account of short coverings and settled 0.58% higher in the October contract on Wednesday. Prices have declined due to weaker than expected demand coupled with higher supplies. Also prospects of higher sowing amid good rains in the chana growing regions have pressurized prices. However, expectations of a pickup in demand due to the festive season prevented a sharp decline in the prices. As per a circular by NCDEX dated August 21 2013, Special Margin of 5% on the Short side imposed earlier has been withdrawn in Chana with effect from beginning of day Friday, August 23, 2013. As per the data released by the ministry of Agriculture, area under kharif th Pulses stood at 102.93 lakh ha as on 6 September 2013, up by 5.35 percent compared to the corresponding period last year. Pulses sowing in Gujarat as on 2 Sept was seen on 4.83 la ha, up by 31% compared to the same period last year. Also, sowing of kharif pulses in th Rajasthan as on 26 August was seen 22.68 lakh ha, up by 20% compared to the corresponding period last year.
nd

Market Highlights
Unit Chana Spot - NCDEX Chana- NCDEX Sept'13 Fut
`/qtl `/qtl

as on Sept 11, 2013 % change Last 3100 3004 Prev day 0.00 0.30 WoW -1.92 -2.91 MoM 8.77 10.85
Source: Reuters

YoY -32.97 -33.50

Spread Matrix
Closing 3100 3004 3110 3188 20-Sep-13 -96 0 -

as on Sept 11, 2013 18-Oct-13 10 106 0 20-Nov-13 88 184 78 0 as on Sept 06, 2013 Stocks as on 3 Sept 46499 53212 10981 110692
rd

Spot 20-Sep-13 18-Oct-13 20-Nov-13

Stock Position at NCDEX warehouse

Location Bikaner Delhi Indore Total Stocks as on 6 Sept 45605 53893 10732 109230
th

Demand supply scenario

After producing record 18.45 mn tn Pulses, India is set to produce record crop for second year in row in 2013-14 as sowing during the ongoing kharif season is excellent propelled by good rains. Also, favorable soil moisture level has made ground for bumper Rabi harvest too. In value terms, India imported $2.3 billion of pulses in 2012-13, almost 28% higher over $1.85 billion in the previous year. However, imports may drop in 2013-14 season on expectations of higher output. Kharif Pulses witnessed a marginal decline in the output which was offset by a considerable rise in Rabi output, especially Chana during 2012-13. Higher returns earned in 2012, coupled with a hike in minimum support prices (MSP), helped expand overall chana acreage in 2012-13 seasons. Chana sowing in 2012-13 was 5.65% higher at 95.17 lakh ha compared to previous year. As per the estimates, Chana output was pegged at a record 8.8 mn tn compared with its third advance estimates of 8.49 million tonnes and a previous record of 8.2 mn tn in 2010-11.

Qty in Process 160 30 70 260

Qty in Process 160 30 70 260

309

111

938

1358

Technical Chart - Chana

NCDEX October contract

Outlook
Chana futures may trade on a mixed note. Prices may open higher extending previous days gains on account of short coverings coupled with pickup in the festive demand. However, no major upside is expected and prices may decline in the later part of the day as adequate stock positions, higher kharif pulses sowing and expectations of a better rabi sowing due to good rains in the chana producing regions may continue to pressurize prices at higher levels.

Source: Telequote

Technical Levels
Contract Chana Oct Futures Unit `/qtl Support

valid for Sept 12, 2013 Resistance 3150-3187

3030-3070

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Commodities Daily Report

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Thursday | 12 Sept, 2013
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Agricultural Commodities
Soybean
Soybean futures witnessed short coverings and settled 1.74% higher on Wednesday after prices declined sharply over the last three sessions. Prices have declined on expectations of new season arrivals to commence in the coming days coupled with Rupee appreciation. In the domestic markets, although area under soybean this season is at record level, concerns over output remain as excessive rains have damaged some soy crop. As per data released by the ministry of Agriculture, area under oilseeds th was recorded at 191.64 la ha on 6 Sept, 2013, an increase of 12.86% th as compared to the corresponding period last year. As on 10 September, soybean sowing in MP is up 9.8% at 63.8 la ha, while in Maharashtra it is up by 21.5% at 39.04 la ha. Indias Soymeal exports jumped to 1.83 lk tn in August against 10,006 tn in August last year due to robust demand and favorable prices. International Markets CBOT Soybean traded on a flat note and settled 0.11% higher on Wednesday as traders have adopted a wait and watch policy ahead of the USDA monthly crop report to be released today. Dry weather have raised yield concerns and have support prices however, harvest of the new crop is expected to commence soon, capping sharp gains. Export demand further supported and upside in the prices. The USDA weekly crop progress report downgraded the good-toexcellent rating to 52% from 54% last week and 32% a year ago. USDA reported that 97% of the crop is setting pods vs. 99% a year ago. The USDA monthly crop report revised the acreage to 77.2 mn acres from its earlier estimates of 77.7 mn acres. Harvest estimates have also been trimmed to 3.255 bn bushels from the earlier estimates of 3.42 bn bushels. Forecast of 2013-14 ending stocks have also been slashed from 295 mn bushels in July to 220 mn bushels. According to Agro consult, a local analyst, Brazil new soy crop is seen at a record 88.4 mn tn in 2013/14 as against 81.46 mn tn last year.

Market Highlights

as on Sept 11, 2013 % Change Prev day WoW 0.09 -2.08 1.74 0.11 0.00 0.41 -3.95 0.54 -2.70 -3.43

Unit Soybean Spot- NCDEX Soybean- NCDEX Oct '13 Fut Soybean-CBOT Sept'13 Fut RM Seed Spot- NCDEX RM Seed- NCDEX Sept'13 Fut
`/qtl `/qtl

Last 3525 3418 1405 3600 3440

MoM 2.23 15.53 3.65 -2.70 6.90

YoY -20.86 -10.23 -17.17 -14.29 -14.66

USc/Bsh
`/qtl `/qtl

Source: Reuters

Soybean Spread Matrix

Closing 3525 Spot 18-Oct-13 20-Nov-13 20-Dec-13 3418 3422 3451.5 0 4 0 18-Oct-13 -107 20-Nov-13 -103

as on Sept 11, 2013 20-Dec-13 -73.5 33.5 29.5 0 as on Sept 11, 2013 18-Oct-13 -80 80 0 20-Nov-13 -38 122 42 0

Mustard Seed Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 3600 3440 3520 3562 20-Sep-13 -160 0 -

RM Seed stock Position at NCDEX warehouse

Location Alwar Bharatpur Bikaner Hapur Jaipur Kota Sriganganagar Total Stocks as on 6th Sept 1776 251 1348 644 40649 781 432 45881 Qty in Process 0 0 0 0 61 10 0 71 Stocks as on 3rd Sept 1776 251 2143 644 43048 781 432 49075

as on Sept 06, 2013 Qty in Process 0 0 0 0 60 0 0 60 NCDEX October contract

Source:Telequote

Outlook
Soybean prices may trade on a mixed note today. Commencement of arrivals of early sown soy crop in the coming days and appreciation in the Rupee may pressurize prices. However, weather concerns in the domestic as well as the US may limit the downside and support prices. Participants may trade cautiously ahead of the USDA monthly report.

Technical Chart Soybean

Rape/mustard Seed
Mustard seed recovered from lower levels and settled 1.12% higher on account of short coverings. Prices have declined sharply over the last few days due to weak oilseeds prices coupled with comfortable supplies of mustard. However, mustard demand due to lean supplies of other oilseeds limited sharp downside in the prices. Agriculture ministry in its fourth advance estimates, pegged mustard output at 7.82 mn tn, up by 18.4% compared to 2011-12 season.

Outlook
Mustard seed futures may trade on a mixed note. Good mustard demand due to lean supply period of other oilseeds may support prices at lower levels. However, ample supplies coupled with prospects of a better sowing may continue to cap gains and pressurize prices.

Technical Levels
Contract Soybean NCDEX Oct Futures RM Seed NCDEX Oct Futures Unit `/qtl `/qtl

valid for Sept 12, 2013 Support 3330-3370 3450-3485 Resistance 3460-3500 3545-3570

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Commodities Daily Report

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Thursday | 12 Sept, 2013
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Agricultural Commodities
Refined Soy Oil
Ref soy oil futures recovered from lower levels on account of short coverings and settled 0.52%. Festive demand also supported prices at lower levels. However, spot prices continued to trade lower and settled 1.15% lower on the back of overall weakness in soybean prices and a sharp appreciation in the Rupee. Expectations arrivals of new season soy crop to commence soon would ease supplies in the coming weeks. India meet 50-55 percent of its edible consumption through imports and thus rupee factor is a major determinant of edible oil prices. As per the data released by the Solvent Extractors' Association of India Imports of vegetable oils, including non-edible oils declined 6.13% to 889,493 tn in July. Monthly soy oil imports rose 69% as local supplies are almost before the soybean crop enters the markets. Stockpiles of edible oil at ports on Aug 1 stood at 610,000 tn, the trade body said, higher than 695,000 tn on July 1. Stocks were still on the higher side despite the decline in monthly imports.

Market Highlights
% Change Unit `/10 kg `/10 kg USc/ Bushel MYR/Tonne `/10 kg Last 672.75 681.35 42.65 2351 530.20 Prev day -1.15 0.52 -0.19 -0.08 -0.36

as on Sept 11, 2013

Ref Soy oil SpotNCDEX Ref Soy oil- NCDEX Sept '13 Fut Soybean Oil- CBOTSept'13 Fut
CPO-Bursa Malaysia Sept '13 Fut CPO-MCX- Sept '13 Futures

WoW -4.03 -2.93 -2.09 -2.00 -4.49

MoM 0.05 2.19 2.40 3.20 5.77

YoY -15.58 -13.99 -22.89 -16.98 -1.61

Source: Reuters

Refined Soy Oil Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 672.75 681.35 663 657.65 20-Sep-13 8.6 0 18-Oct-13 -9.75 -18.35 0 -

as on Sept 11, 2013 20-Nov-13 -15.1 -23.7 -5.35 0 as on Sept 11, 2013

Outlook
Soy oil may trade on a mixed note with a negative bias. Appreciation in the Rupee, coupled with expectations of arrivals of the early soy crop and comfortable stocks of imported edible may pressurize prices. However, festive demand may support prices at lower levels.

CPO Spread Matrix

30-Sep-13 31-Oct-13 30-Nov-13 Closing 530.2 527.1 527.5 30-Sep-13 0 31-Oct-13 -3.1 0 -

Crude Palm Oil

MCX CPO Futures traded on a negative note and settled 0.36% lower on account of a strong Rupee coupled with weakness on the KLCE. However, festive demand supported prices at lower levels. Malaysian palm oil futures inched up earlier this week on expectations that healthy exports will persist into September coupled with a weak Ringgit boosting export hopes. Prices on the KLCE had earlier declined to the lowest level this year and have spurred export demand for most consumed cooking oil. Also, an increase in the output is expected due to seasonally higher yield period, which may cap sharp upside and pressurize prices. Exports of Malaysian palm oil products between September 1-10 increased 10.79% to 462,471 tonnes from 417,414 tonnes shipped between August 1-10. Malaysia has set the export tax for Palm oil at 4.5% for September, unchanged since March. According to Malaysian Palm oil Board, exports increased 7.37% in August against July, while palm oil output increased 3.6% and the end stocks increased 0.11%. India's refined palm oil imports declined 27.8% in July to 213,853 tn from 296, 230 tn in June as a weak Rupee made imports expensive.

30-Nov-13 -2.7 0.4 0

Technical Chart Ref Soy Oil

NCDEX October contract

Technical Chart Crude Palm Oil

MCX Sept contract

Source: Telequote

Outlook
CPO may continue to decline tracking weak KLCE coupled with Rupee appreciation. However, sentiments for Malaysian palm oil futures remain positive on hopes of healthy exports to continue in the month of September thereby keeping stock levels lower.

Technical Outlook
Contract Soy Oil Oct NCDEX Futures CPO MCX Sept Futures Unit `/qtl `/qtl

valid for Sept 12, 2013 Support 654-658 522-526 Resistance 667-672 535-540

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Thursday | 12 Sept, 2013
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Agricultural Commodities
Spices
Jeera
Jeera October futures recovered in early trades on short coverings. However, prices declined from higher levels amid easing tensions in Syria. Also, expectations of higher sowing in the coming season due to good rains in the jeera belt in Gujarat have pressurized prices. Prices gained earlier due to the ongoing tensions in Syria coupled with lower production in Turkey as well as good domestic demand. The spot as well as the Futures settled 0.18% and 0.15% lower on Wednesday. According to IBIS, India exported 9462.64 tn of jeera in June. The major destinations were UAE, Nepal, Vietnam & USA. 1% Jeera of Indian origin Singapore is being offered at $2,200/tn (FOB Mum) while Europe at $2,300-2,325/tn (CNF). (Source: Agriwatch) In the global markets, there is a supply crunch due to the ongoing geopolitical tensions in Syria and Turkey, which has raised supply concerns from these two major exporting countries. Export orders are diverted to India. Production is also expected to decline in Syria and Turkey.

Market Highlights
Unit `/qtl `/qtl `/qtl `/qtl Last 13665 13173 5052 4714 Prev day -0.18 -0.49 -0.41 -3.99

as on Sept 11, 2013 % Change WoW -1.43 -3.96 -2.25 -7.28 MoM 0.43 -0.51 -1.58 -1.96 YoY -7.93 -5.10 -8.02 -20.77

Jeera Spot- NCDEX Jeera- NCDEX July '13 Sept Turmeric Spot- NCDEX Turmeric- NCDEX Sept '13 Fut

Source: Reuters

Jeera Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 13664.5 13172.5 13520 13702.5 20-Sep-13 -492 0 18-Oct-13 -144.5 347.5 0 -

as on Sept 11, 2013 20-Nov-13 38 530 182.5 0 as on Sept 11, 2013 20-Sep-13 -338 0 18-Oct-13 -134 204 0 20-Nov-13 -14 324 120 0 as on Sept 06, 2013 Stocks as on Qty in 3rd Sept Process 1388 2640 4028 8546 NCDEX October contract 0 130 130 0

Arrivals production and Exports

Arrivals in Unjha were reported at 11,000 bags on Wednesday. Exports of Jeera in 2012 - 2013 stood at 79,900 tn, an increase of 75%. (Source:
Spices Board)

Turmeric Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 5052 4714 4918 5038

Production of Jeera in 2012-13 is expected around 40-45 lakh bags (55 kgs each), marginally higher than 40 lakh bags last year. Carryover stocks from 2011-12 harvest were around 8-9 lakh bags.

Outlook
Jeera futures are expected to trade lower today. Easing tensions in Syria coupled with prospects of higher sowing in the coming season may continue to pressurize prices. However, overseas as well as domestic demand may support prices. Situation in Syria needs to be closely watched, as escalation of tensions will push up the prices.

Stock Position at NCDEX warehouse

Location Jeera Turmeric Jodhpur Unjha Total Nizamabad Stocks as on 6th Sept 1319 2310 3629 8546 Qty in Process 0 267 267 0

Turmeric
Turmeric October Futures traded on a negative note and settled 2.69% lower on Wednesday on account of huge carryover stocks coupled with good sowing amid favorable weather conditions. However, overseas as well as domestic demand supported prices at lower levels. According to a circular by NCDEX, launch of April 2014 expiry contract in Turmeric has been postponed till further notice.

Technical Chart Jeera

Production, Arrivals and Exports

Arrivals in Nizamabad and Erode were reported at 1,500 and 2,200 bags respectively on Wednesday. Sowing of Turmeric in AP is reported th at 0.51 lakh ha as on 4 September, as against 0.54 lakh ha last year and a normal sowing of 0.64 lakh ha. Production in 2012-13 is reported around 45 lakh bags, lower by 4050%. It is estimated that current years carryover stocks would be around 10 lakh bags. (1 bag= 75 kgs). Exports for 2012-13 stood at 80,050 tn, marginally higher than 79,500 tn last year. (Source: Spices Board) Outlook Huge carryover stocks coupled with favorable climate may continue to pressurize turmeric prices further. However, export as well as festive demand may limit the downside and support prices at lower levels.

Technical Chart Turmeric

NCDEX October contract

Technical Outlook
Jeera NCDEX Oct Futures Turmeric NCDEX Oct Futures Unit `/qtl `/qtl

Valid for Sept 12, 2013

Support 13340-13430 4760-4840 Resistance 13620-13710 5000-5080
Source: Telequote

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Commodities Daily Report

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Thursday | 12 Sept, 2013
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Agricultural Commodities
Sugar
Sugar October futures continued to decline on Wednesday and settled 0.5% lower as ample supplies along with expectations of a higher output and selling pressure from the mills have kept prices under check. However, a pickup in demand ahead of the festive season restricted a sharp decline and supported prices at lower levels. An increase in the import duty to curb the inflows also supported prices at lower levels. The Food Minister said that his ministry has moved a cabinet proposal to allow state governments to hike prices of sugar for PDS. Good monsoon conditions in Maharashtra and Karnataka has led to expectations of recovery in the cane yield, keeping prices under pressure. According to the Ministry of Agriculture, Sugarcane has been planted in th 48.74 la ha as on 6 Sept 2013 as compared to 50.06 la ha last year as drought affected Maharashtra and Karnataka have reported lower area. Based on satellite images for June and field surveys carried out by ISMA (Indian Sugar Mills Association), total sugarcane acreage available for crushing in the sugar season 2013-14 will be about 51.50 lakh hectares, which is about 1.52% less than 52.30 lakh hectares last year. (Source: ET)

Market Highlights
Unit Sugar SpotNCDEX Sugar M- NCDEX Sept '13 Fut Sugar No 5- LiffeOct'13 Fut Sugar No 11-ICE October '13 Fut `/qtl 2999 `/qtl 497.1 $/tonne 381.56 $/tonne -0.06 -0.16 0.44 Last 3028

as on Sept 11, 2013 % Change Prev. day WoW -0.08 0.07 -0.10 3.54 4.82 MoM YoY -0.81 -15.70 -0.33 0.81 2.08 -13.75 -10.67 -11.68

Source: Reuters

Sugar Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 3027.5 2999 2984 3005 20-Sep-13 -28.5 0 18-Oct-13 -43.5 -15 0 -

as on Sept 11,2013 20-Nov-13 -22.5 6 21 0

Domestic Production and Exports

After producing surplus sugar in the current season, sugar output is expected to decline in 2013-14 season on account of lower plantings. However, good monsoon has curbed some losses. According to the preliminary estimate of an industry body, Production is estimated to be 237 lakh tonne for 2013-14 season as compared to 250 lakh tonnes in 2012-13. According to trade body, with a domestic consumption of 235 lakh tonne and an expected production of 237 lakh tonne, the year 2013-14 will be a consecutive fourth year of surplus production for India. ISMA has estimated that the opening balance as on October 1, 2013 (for the new season 2013-14), will be around 80 lakh tonne, which is about 20 lakh tonne more than the normal opening balance.

Stock Position at NCDEX warehouse

Location Delhi Kolhapur Sangli Solapur Total Stocks as on 6th Sept 599 3874 0 923 5396 Qty in Process 599 0 0 0 599 Stocks as 3 Sept 449 5452 0 923 6824
rd

as on Sept 06, 2013 Qty in Process 0 0 0 0 0

Technical Chart - Sugar

NCDEX October contract

Global Sugar Updates

LIFFE as well as ICE Sugar corrected on account of profit taking and settled 0.16% and 0.06% lower respectively on Wednesday. Prices have gained due to good demand in the physical markets. However, ample supplies due to higher crushing in Brazil have capped sharp gains. The ISO has estimated sugar surplus to fall to 4.5 mn tn in 2013/14 as against 10.3 mn tn last year. Brazil's main cane region produced 3.2 mn tn sugar in the second half of August, up 10% from the 2.91 mn tn produced in the first half of August. Prices, in the long term have declined on account of abundant supplies from Brazil. According to UNICA, Brazilian mills have produced 19.961 mn tn of sugar from the start of the cane season on April 1, up 7 percent from a year ago. According to Datagro, Centre-South output for 2013/14 is seen at 34.18 mn tn against 34.09 mn tn last year. Mills allocate 48.63% of cane to sugar while 51.37% to ethanol.

Source: Telequote

Outlook
Sugar may trade with negative bias as ample supplies, selling by the mills and expectations of a sugar surplus continue to mount pressure on the prices. However, festive demand may support prices at lower levels.

Technical Outlook
Contract Sugar Oct NCDEX Futures Unit `/qtl

valid for Sept 12, 2013 Support 2965-2975 Resistance 2995-3005

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Commodities Daily Report

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Thursday | 12 Sept, 2013
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Agricultural Commodities
Kapas
A sharp appreciation in the Rupee has continued to pressurize prices in NCDEX Kapas as well as Cotton Futures which settled 0.87% and 1.26% lower respectively. Demand from millers as well as yarn exports coupled with expectations of delay in harvesting by around 15 days due to heavy rains have supported prices. The government has allowed the CCI to export more cotton in the current season. The government may discuss imposing a 10% tax (with a maximum of Rs.10,000 per tonne) on exports of surplus cotton today. Ministry of Agriculture, in its fourth Advance estimates of Food grain production wherein it pegged Cotton output at 34 million bales (1 bale= 170 kg) in 2012-13, lower than the record 35.2 million bales in the previous year. With the cotton season nearing its end, arrivals have declined considerably. According to CCI, Cotton arrivals since the beginning of the th season (Oct 2012- Sep 2013) till 14 July is reported at 331.15, down 1.48 percent compared to same period last year.

Market Highlights
Unit `20 kgs `/Bale USc/Lbs Last 1021 21140 84.8 90

as on Sept 11, 2013 % Change Prev. day WoW -0.87 -1.59 -1.26 -5.29 -0.06 2.38 0.67 1.41 MoM YoY -1.59 #N/A 1.54 20.59 -5.12 14.16 -3.69
Source: Reuters

NCDEX Kapas Apr Fut MCX Cotton Aug Fut ICE Cotton Oct 13 Cot look A Index

5.82

Cotton Spread Matrix

Closing 31-Oct-13 29-Nov-13 31-Dec-13 21140 20390 20370 31-Oct-13 0 -

as on Sept 11, 2013 29-Nov-13 31-Dec-13 -750 0 -770 -20 0

Sowing Progress
As per the ministry of agriculture, cotton sowing was reported at 113.12 th la ha on 6 Sept 2013 as against 113.46 la ha last year. In Gujarat, cotton was sown on 26.88 la ha as on 6 September 2013, up by 13.7% compared to the same period last year. In Rajasthan, it was th done on 3 la ha as on 27 August 2013 as against 4.53 la ha last year. In th AP, cotton sowing was undertaken on 20.94 la ha as on 4 September 2013 as against 21.4 la ha last year.
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Technical Chart - Kapas

NCDEX April contract

Domestic Production and Consumption

Cotton Advisory Board (CAB) in its latest meet dated 17 April 2013 has projected cotton crop at 34 mn bales for 2012-13 season compared to the previous estimates of 33 mn bales. Mill consumption is expected to go up from 22.3 mn bales last year to 23.5 mn bales. Exports are estimated at 8.1 mn bales while imports are estimated 2.5 mn bales. However, Cotton Association of Indias estimates differ from that of the CAB which pegs cotton output for 201213 at 35.2 mn bales as on May 31 down 6% compared with 37.3 mn bales in 2011-12.
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Technical Chart - Cotton

MCX Oct contract

Global Cotton Updates

ICE cotton futures traded on a flat note and settled 0.06% lower ahead of the USDA report. Prices gained earlier due to stockpiling from China. However, subdued mill demand capped sharp gains. The USDA monthly report lowered US cotton output forecast to 13.05 million bales, the lowest in four years. The USDA weekly crop progress report rated good/excellent condition at 47% against 46% last week and reduced the poor/very poor at 20% against 23% last week. ICAC has increased projections for global production and endings stocks for the 2013/14 crop year. As per USDA acreage report, the estimate for U.S. cotton planted acreage is down 17% from 2012, but is up from March 2013 estimates.

Source: Telequote

Outlook
Cotton futures may trade on a mixed note. Appreciation in the Rupee may pressurize prices while expected delay in arrivals coupled with demand from millers as well as yarn exporters may support prices. Prices may also take cues from the USDA crop report to be released today.

Technical Outlook
Contract Kapas NCDEX April 14 Fut Cotton MCX Oct Futures Unit `/20 kgs `/bale

valid for Sept 12, 2013 Support 1006-1014 20750-20950 Resistance 1030-1040 21320-21500

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Commodities Daily Report

`
Thursday | 12 Sept, 2013
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Agricultural Commodities
Guar Complex
Guar complex hit yet another upper circuit on Wednesday on concerns over crop yield. Further holding back of stocks in anticipation of further rise in the prices also supported an upside rally in the complex. Despite of the regulator imposing 10 percent special margin on long side w.e.f from Wednesday, upside remained intact. Special Margin of 10% on the Long side will be imposed on all running contracts and yet to be launched contracts in Guar Seed and Guar Gum w.e.f beginning of Wednesday Sept 11, 2013. This will be in addition to Special Margins imposed as stated in contract specifications. Dry and hot weather in the Guar areas in Rajasthan and Haryana may have an adverse impact on the yield. Supplies have declined in the last 23 weeks as farmers are not liquidating their stocks at lower levels. All these factors along with overall weakness in the Indian rupee supported an upside movement in the guar complex.

Market Highlights
Unit Guar Seed SpotNCDEX Guar Seed- NCDEX Oct 13 Fut Guar Gum SpotNCDEX Guar Gum- NCDEX Oct 13 Fut `/qtl 7780 `/qtl 25648 `/qtl 21520 `/qtl 3.96 6.39 3.87 Last Prev day 9040 6.35

as on Sept 11, 2013 % change WoW 15.36 20.25 23.34 21.58 MoM 70.99 84.80 75.59 82.53 YoY #N/A #N/A #N/A #N/A

Source: Reuters

NCDEX Guarseed Spread Matrix

Spot 18-Oct-13 20-Nov-13 20-Dec-13 Closing 9040 7780 7480 7430 18-Oct-13 -1260 0 -

as on Sept 11, 2013 20-Nov-13 -1560 -300 0 20-Dec-13 -1610 -350 -50 0 as on Sept 11, 2013 20-Nov-13 -5068.35 -940 0 20-Dec-13 -4888.35 -760 180 0 as on Sept 06, 2013 Stocks as on 3rd Sept 50 52 20 Qty in Process 0 0 0

Monsoon and Sowing

Southwest monsoon which arrived early this season is seen retreating from the parts of Haryana and Rajasthan. Also, High temperature is affecting the growth of guar seeds sown after July 15. Almost 75-80 percent area in Rajasthan is rain fed while in Haryana 35-40 % area is dependent on rains. Guar is a rain-fed monsoon crop, which requires 8-15 inch of rain in 3-4 spells. According to Rajasthan Farm Department, Guar seed acreage as on 27 August, 2013 stood at 34.3 lakh hectares compared with 26.58 lakh hectares sown during the same period last year.
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NCDEX Guar gum Spread Matrix

Spot 18-Oct-13 20-Nov-13 20-Dec-13 Closing 25648.35 21520 20580 20760 18-Oct-13 -4128.35 0 -

Stock Position at NCDEX warehouse

Location Deesa Bikaner Sriganganagar Stocks as on 6th Sept 50 52 20 Qty in Process 0 0 0

Production and Exports

According to Rajasthan Farm Departments third advance estimates, Guar seed production stood at 20.23 lakh tonnes in 2012-13. Although production is higher compared to the previous year, but still it is much below the initial expectations on account of erratic monsoon last year. In the coming season, higher sowing along with timely rains has raised hopes of bumper production earlier. However, the current dry spell may adversely impact output going forward. Exports which touched record 7.07 lakh tonnes in the FY 2011-12, declined in the FY 2012-13 as US, the largest importer of Guar gum has stocked huge inventories. However, Fuelled by demand in China and the US, guar gum export from India in April-May rose nearly 12 per cent but realization fell 57 per cent due to lower prices. (Source: Business standard).

Technical Chart - Guar Seed

NCDEX October contract

Outlook
Concerns over crop yield amid high temperature in Rajasthan and Haryana may continue to support an upside rally in the guar complex. Also, supplies are comparatively lower as farmers are also holding back their stocks expecting better realization in the coming days.

Technical Chart - Guar Gum

NCDEX October contract

Source: Telequote

Technical Outlook
Contract Guar Seed Oct (NCDEX) Guar Seed Oct (MCX) Guar Gum Oct (NCDEX) Guar Gum Oct (MCX) Unit `/qtl `/qtl `/qtl `/qtl

valid for Sept 12, 2013 Support 7650-7720 7450-7510 21180-21350 20370-20530 Resistance 7840-7900 7640-7700 21680-21850 20880-21050

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