Commodities Daily Report

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Monday | 16 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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Monday | 16 Sept, 2013
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Agricultural Commodities
NEWS HIGHLIGHTS
Farm sector growth estimate raised to 4.8% this fiscal
The Prime Ministers Economic Advisory Council (PMEAC) has estimated farm sector growth for current fiscal at 4.8 per cent, more than twice last years 1.9 per cent, on excess rains boosting prospects of a bumper kharif harvest. The monsoon has been very good and the kharif planting has been extraordinarily good. With good rains and reservoir position, the rabi harvest should be strong, it said. As on September 13, the kharif acreage stood at 1,033.63 lakh hectares (ha), about five per cent more than last year. Rice was planted in 371.75 lakh ha (360.92 lakh ha in corresponding last year), pulses in 103.76 lakh ha (98.25 lakh ha) and coarse cereals in 195.02 lakh ha (175.83 lakh ha). Total oilseed acreage stood at 195.02 lakh ha (170.97 lakh ha). The Council said 2013-14 is likely to see higher output in rice and wheat, and significant gains in coarse cereals and pulses. The output of pulses may be en route to crossing 20 million tonnes (mt) the highest output level ever recorded, and nearly double the production level of a decade ago. Thus, output of foodgrain can be expected to hit a new record this year, it said. (Source:
Business Line dated 14th Sept, 2013)

Market Highlights (% change)

Last Prev. day

as on Sept 14, 2013

WoW MoM YoY

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

19782 5851 63.43 108.6 1330.4

-1.08 -1.06 0.24 0.97 -2.46

4.23 4.61 -3.92 0.21 -3.11

4.41 4.25 3.77 2.35 -0.32

9.90 7.73 14.88 11.95 -23.12

.Source: Reuters

FMC asks MCX, NCDEX to probe guar futures price movement

Commodities market regulator FMC has asked MCX and NCDEX to probe the volatility in guar futures prices and submit a report withing 15 days. Prices of guar seed and guar gum for October delivery at the countrys two largest commodity bourses - MCX and NCDEX - have risen up to 85 per cent in the last one month. At NCDEX, prices of guar seed for October delivery has increased by 85 per cent to Rs 7,720 per quintal on September 13 as compared with Rs 4,170 per quintal on August 13. Prices of guar gum for October delivery rose by 81 per cent to Rs 21,490 per quintal on September 13 from Rs 11,860 per quintal on the same day in the previous month. A similar trend was seen in prices of guar seed and guar gum on the MCX platform as well. FMC had allowed resumption of guar futures trade in May this year. In a directive, the Forward Markets Commission (FMC) said: After the re-launch of the guar gum and guar seed contracts, it has been observed that there is high price volatility in recent times. (Source: Business Line)

Vegetable oil imports fall 15.5% in August

Vegetable oil imports fell by 15.52% during the last month to 7.57 lakh tonnes due to volatility in the rupee's value, according to the trade data released Friday. Imports of vegetable oils, comprising edible oil and nonedible oils, stood at 8.97 lakh tonnes in the same month last year. "Import during August decreased due to rupee volatility," Solvent Extractors' Association said in a statement. However, the total import of vegetable oils during November 2012-August 2013 increased by 8% to 87,92,383 tonnes compared to 81,62,545 tonnes in the year-ago period. The oil year runs from November to October. "The rupee has suddenly fallen in the last few days and touched R68.36 a dollar on August 28, 2013 and now rested at R63.59 (September 12), putting pressure on import of vegetable oils," SEA said. The association also noted that during the last one year, RBD Palmolein has fallen by $195 (19%), CPO by $171 (17%), crude soybean oil by $326 (26%) and crude sunflower oil by $202 (16%). Total stock, both at ports and pipelines, is estimated at 16,85,000 tonnes compared to 19,90,000 tonnes in the previous month. (Source:
Financial Express dated14th Sept, 2013)

Record crop likely in coarse cereals

Currenty, maize (corn) for delivery to exporters in November is quoted at $220 or Rs 13,950 a tonne f.o.b. If this is worked backwards, then its price could be lower than the minimum support price of Rs 1,310 a quintal fixed for this year. In turn, it could leave the Government, which is headed for elections in six months time, in a fix to ensure that growers get at least the support price. Excess and even spread of rainfall during the current monsoon could have brought smiles to the faces of farmers. But in the case of coarse cereals, it is also bringing in an additional problem on the prospect of a higher, if not a record, production. Rains have been good in areas where coarse cereals are grown, says Amit Sachdev, a consultant for the industry on cereals. There are some reports of damage in a few places but I dont see that affecting the final outcome, said Sachdev. (Source: Business Line)

Onion price likely to go up again

There seems to be no immediate respite to consumers from high onion prices. After easing marginally in the past couple of weeks, onion prices are on the rise again. Heavy rainfall in the South has affected the ongoing harvest in States such as Karnataka and Andhra Pradesh, resulting in lower market arrivals and prices soaring in consuming centres. In Delhi, the average wholesale price, which stood at Rs 3,700 a quintal in early September, rose to over Rs 4,432 on Friday, an increase of 20 per cent in the past two weeks. In Lasalgaon, the countrys largest onion market, the average wholesale price ruled higher than the Delhi market at Rs 4,550 a quintal on Friday. At the retail level, the prices in Delhi, which hovered around Rs 55 a kg last week, have now crossed Rs 60.Trade sources expect prices to remain firm or increase in the near term until supplies from Karnataka and Andhra Pradesh improve or the main crop from Nashik arrives in early October. (Source: Business Line)

Govt likely to raise import duty on refined edible oil to 10%

The government is expected to raise import duty on refined edible oil to 10%, from 7.5% at present, to protect the domestic oil refining industry. A Cabinet note regarding this has already been circulated by the Food Ministry, sources said. The move is aimed at protecting domestic players who are into refined edible oil business, they added. Currently, the cost of imported refined edible oil is lower than that of crude edible oil due to inverted duty structure adopted by exporting countries like Indonesia and Malaysia. These exporting nations are giving export duty benefits for finished products to their traders. Inverted duty structure impacts the domestic industry adversely as it has to pay a higher price for raw material in terms of duty, while the finished product lands at lower duty and costs low. Import duty on crude edible oil is about 2.5%, while on refined oils is 7.5%. (Source: Business Standard)

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Commodities Daily Report

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Monday | 16 Sept, 2013
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Agricultural Commodities
Chana
Chana futures opened the week on a negative note on account of higher kharif pulses sowing coupled with prospects of a better chana sowing in the coming season. However, prices picked up in the second half of the week on strong festive season demand. Improving demand from the millers due to declining supplies from the major producing regions also supported prices. The spot as well as the October Futures settled 1.72% and 0.61% higher respectively w-o-w. 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 103.76 lakh ha as on 13 September 2013, up by 5.6 percent compared to the corresponding period last year. Sowing of kharif pulses in Maharashtra as on 13 Sept was seen 19.15 lakh ha, up by 1.38% compared to the corresponding period last year.
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Market Highlights
Unit Chana Spot - NCDEX Chana- NCDEX Sept'13 Fut
`/qtl `/qtl

as on Sept 14, 2013 % change Last 3150 3111 Prev day 1.61 3.56 WoW 0.00 0.45 MoM 7.75 10.40
Source: Reuters

YoY -32.31 -32.89

Spread Matrix
Closing 3150 3111 3220 3298 20-Sep-13 -39 0 -

as on Sept 14, 2013 18-Oct-13 70 109 0 20-Nov-13 148 187 78 0 as on Sept 12, 2013 Stocks as on 10th Sept 45605 53893 10732 109230 Qty in Process 160 30 70 260

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

Stock Position at NCDEX warehouse

Location Bikaner Delhi Indore Total Stocks as 11 Sept 45605 52923 10762 109290
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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 0 190

309

111

938

1358

Technical Chart - Chana

NCDEX October contract

Outlook
Chana futures are expected to trade on a mixed note with a positive bias on account of a pickup in the physical demand especially from the millers on the back of declining supplies. Also, upcoming festive demand is expected to support prices. However, higher kharif pulses sowing and expectations of a better rabi sowing due to good rains in the chana producing regions may cap sharp gains and pressurize prices at higher levels.

Source: Telequote

Technical Levels
Contract Chana Oct Futures Unit `/qtl Support

valid for Sept 16, 2013 Resistance 3200-3240

3080-3120

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Commodities Daily Report

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Monday | 16 Sept, 2013
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Agricultural Commodities
Soybean
Soybean futures traded on a positive note last week and settled 0.32% higher due to higher international markets and robust soy meal export demand. Expectations of new season arrivals to commence in the coming days capped gains and pressurized prices earlier last week. In the domestic markets, although area under soybean this season is at record level, concerns over output remain as excessive rains in MP have damaged some soy crop. Overall production is still expected to remain higher due to early rains and increased planting As per data released by the ministry of Agriculture, area under oilseeds th was recorded at 192.51 la ha on 13 Sept, 2013, an increase of 12.6% 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 21.7% at 39.16 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 positive to bullish note last week and settled 3.6% higher as the USDA monthly report revised soybean production estimates lower than August. The USDA monthly crop report kept the acreage to 77.2 mn acres unchanged from its earlier estimates. Harvest estimates have been trimmed to 3.149 bn bushels from the earlier estimates of 3.255 bn bushels. Forecast of 2013-14 ending stocks have also been slashed from 220 mn bushels in August to 150 mn bushels. Dry weather and heat conditions in the Midwest have raised yield concerns and support prices. Export demand further supported an 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. 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.
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Market Highlights

as on Sept 14, 2013 % Change Prev day WoW 0.99 -0.22 0.99 2.62 0.89 2.03 -2.35 1.34 -1.60 -1.96

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 3560 3452 1442 3632 3510

MoM -0.25 15.18 4.97 -1.60 7.87

YoY -20.84 -9.04 -17.16 -14.81 -13.87

USc/Bsh
`/qtl `/qtl

Source: Reuters

Soybean Spread Matrix

Closing 3560 Spot 18-Oct-13 20-Nov-13 20-Dec-13 3452 3454.5 3486 0 2.5 0 18-Oct-13 -108 20-Nov-13 -105.5

as on Sept 14, 2013 20-Dec-13 -74 34 31.5 0 as on Sept 14, 2013 18-Oct-13 -82.1 40 0 20-Nov-13 -38.1 84 44 0

Mustard Seed Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 3632.1 3510 3550 3594 20-Sep-13 -122.1 0 -

RM Seed stock Position at NCDEX warehouse

Location Alwar Bharatpur Bikaner Hapur Jaipur Kota Sriganganagar Total Stocks as on 11th Sept 1776 251 1348 644 38234 781 432 43476 Qty in Process 0 0 0 50 60 30 0 140 Stocks as on 10th Sept 1776 251 1348 644 40649 781 432 45881

as on Sept 12, 2013 Qty in Process 0 0 0 0 61 10 0 71 NCDEX October contract

Source:Telequote

Outlook
Soybean futures are expected to trade on a positive note today on the back of weather concerns in the domestic as well as the US. However, commencement of arrivals of early sown soy crop in the coming days may cap gains.

Technical Chart Soybean

Rape/mustard Seed
Mustard traded on a mixed note last week and settled 0.7% lower. Prices opened lower tracking comfortable supplies coupled with weak oilseeds. However, prices recovered from lower levels due to good demand for mustard on the back of lean supplies of other oilseeds. 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 with a positive bias on the back of good mustard demand coupled with higher oilseeds prices. However, ample supplies coupled with expectations 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 16, 2013 Support 3420-3450 3500-3520 Resistance 3520-3550 3570-3600

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Commodities Daily Report

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Monday | 16 Sept, 2013
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Agricultural Commodities
Refined Soy Oil
Ref soy oil October futures traded on a negative note last week and settled 2.25% lower on expectations that arrivals of new season soy crop in would commence soon, easing supplies in the coming weeks coupled with appreciation in the Rupee. However, festive demand supported prices at lower levels. 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 15.52% to 757,830 tn in August. 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 Sept 1 stood at 505,000 tn, the trade body said, lower than 610,000 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 675.40 684.05 42.69 2361 531.80 Prev day 0.39 0.40 0.09 0.43 0.30

as on Sept 14, 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 -3.20 -1.89 -1.16 -1.63 -2.92

MoM -0.60 1.20 0.87 3.55 5.62

YoY -15.36 -13.14 -23.65 -16.22 -0.73

Source: Reuters

Refined Soy Oil Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 675.4 684.05 669.1 665.3 20-Sep-13 8.65 0 18-Oct-13 -6.3 -14.95 0 -

as on Sept 14, 2013 20-Nov-13 -10.1 -18.75 -3.8 0 as on Sept 14, 2013

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

Crude Palm Oil

MCX CPO Futures traded on a negative note last week and settled 2.9% lower on account of Rupee appreciation coupled with weak KLCE, which also declined 2.96%. However, festive demand supported prices at lower levels. 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, may cap sharp upside and pressurize prices. Malaysian palm oil futures had increased earlier on expectations that healthy exports will persist into September coupled with a weak Ringgit boosting export hopes. 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 7.8% in August against August, while palm oil output increased 3.64% and the end stocks increased 0.11%. India's refined palm oil imports declined 33.03% in Aug to 143,215 tn from 213,853 tn in July as a weak Rupee made imports expensive.

CPO Spread Matrix

30-Sep-13 31-Oct-13 30-Nov-13 Closing 531.8 528.8 529.1 30-Sep-13 0 31-Oct-13 -3 0 -

30-Nov-13 -2.7 0.3 0

Technical Chart Ref Soy Oil

NCDEX October contract

Technical Chart Crude Palm Oil

MCX Sept contract

Source: Telequote

Outlook
CPO may trade with a negative bias today. Comfortable supplies coupled with Rupee Appreciation may pressurize prices. However, festive demand may support prices at lower levels. Sentiments for Malaysian palm oil futures remain positive on hopes of healthy exports to continue in the month of September.

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

valid for Sept 16, 2013 Support 654-657 522-525 Resistance 665-669 532-535

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Commodities Daily Report

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Monday | 16 Sept, 2013
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Agricultural Commodities
Spices
Jeera
Jeera futures traded on a negative note and settled 1.53% last week on account of easing tensions in Syria. Also, good rains in the Jeera growing belt in Gujarat have increased prospects of a better sowing in the upcoming season. However, good overseas as well as domestic demand supported prices at lower levels. 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 $2,200-2,225/tn (FOB Mum) while Europe at $2,325-2,350/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 13674 13348 4942 4568 Prev day 0.07 1.33 -2.17 -3.10

as on Sept 14, 2013 % Change WoW -1.11 -2.73 -4.37 -11.13 MoM 1.01 0.95 -2.85 -2.31 YoY -7.91 -3.91 -11.55 -24.12

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 13673.7 13347.5 13662.5 13862.5 20-Sep-13 -326.2 0 18-Oct-13 -11.2 315 0 -

as on Sept 14, 2013 20-Nov-13 188.8 515 200 0 as on Sept 14, 2013 20-Sep-13 -374.4 0 18-Oct-13 -58.4 316 0 20-Nov-13 59.6 434 118 0 as on Sept 12, 2013 Stocks as on Qty in 10th Sept Process 1319 2310 3629 8546 NCDEX October contract 0 267 267 0

Arrivals production and Exports

Arrivals in Unjha were reported at 12,000 bags on Monday. 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 4942.4 4568 4884 5002

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 may trade on a mixed note. Easing tensions in Syria coupled with prospects of higher sowing in the coming season may pressurize prices. However, overseas as well as domestic demand may support prices at lower levels. 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 11th Sept 1319 2425 3744 8546 Qty in Process 30 288 318 0

Turmeric
Turmeric Futures traded on a negative note last week and settled 3.68% lower on account of huge carryover stocks coupled with good sowing amid favorable weather conditions. Overseas as well as domestic demand have limited the downside. 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 1,000 and 3,000 bags respectively on Friday. Sowing of Turmeric in AP is reported at th 0.53 lakh ha as on 11 September, as against 0.54 lakh ha last year and a normal sowing of 0.66 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 Turmeric futures are expected to trade lower huge carryover stocks coupled with favorable climate may continue to pressurize prices. 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 16, 2013

Support 13300-13400 4730-4800 Resistance 13585-13680 4930-5000
Source: Telequote

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Commodities Daily Report

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Monday | 16 Sept, 2013
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Agricultural Commodities
Sugar
Sugar October futures traded with a negative bias last week as ample supplies along with expectations of a higher output and selling pressure from the mills have pressurized prices. 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 spot as well as the October Futures settled 0.01% and 0.33% lower w-o-w. 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 on th 48.74 la ha as on 13 Sept 2013 which is 2.64% lower than last year. This is because 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 3008 `/qtl 494.5 $/tonne 381.78 $/tonne 0.06 -0.52 0.30 Last 3020

as on Sept 14, 2013 % Change Prev. day WoW -0.25 -0.38 0.37 1.98 4.06 MoM YoY -0.80 -15.63 -0.43 -1.14 0.12 -12.81 -11.36 -12.88

Source: Reuters

Sugar Spread Matrix

Spot 20-Sep-13 18-Oct-13 20-Nov-13 Closing 3020 3008 2988 2997 20-Sep-13 -12 0 18-Oct-13 -32 -20 0 -

as on Sept 14,2013 20-Nov-13 -23 -11 9 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 11th Sept 599 3874 0 923 5396 Qty in Process 599 0 0 0 599 Stocks as 10 Sept 599 3874 0 923 5396
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as on Sept 12, 2013 Qty in Process 599 0 0 0 599

Technical Chart - Sugar

NCDEX October contract

Global Sugar Updates

LIFFE as well as ICE Sugar settled 0.16% and 1.79% w-o-w due to good demand in the physical markets. However, ample supplies due to higher crushing in Brazil coupled with USDA monthly reports forecast of higher supplies 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 16, 2013 Support 2976-2984 Resistance 3000-3010

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Commodities Daily Report

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Monday | 16 Sept, 2013
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Agricultural Commodities
Kapas
MCX Cotton Futures declined 0.84% w-o-w despite higher international prices on account of recovery in the Rupee. 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 at lower levels. The government has allowed the CCI to export more cotton in the current season. The government deferred the decision of imposing a 10% tax on exports of surplus cotton. NCDEX Kapas settled unchanged. 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 1027 21520 85.88 89.85

as on Sept 14, 2013 % Change Prev. day WoW 0.59 0.00 1.80 -0.78 1.27 4.22 -0.17 1.24 MoM YoY 0.00 #N/A 2.92 22.76 -4.64 17.92 -4.47
Source: Reuters

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

6.46

Cotton Spread Matrix

Closing 31-Oct-13 29-Nov-13 31-Dec-13 21520 20530 20540 31-Oct-13 0 -

as on Sept 14, 2013 29-Nov-13 31-Dec-13 -990 0 -980 10 0

Sowing Progress
As per the ministry of agriculture, cotton sowing was reported at 113.5 la th ha on 13 Sept 2013 as against 114.44 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 positive note last week and settled 2.37% higher as the USDA report revised lower the output projection coupled with stockpiling from China. However, higher end stock estimate capped sharp gains. The USDA monthly report lowered US cotton output forecast to 12.9 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. Depreciation in the Rupee coupled with expected delay in arrivals and from millers as well as yarn exporters may support prices.

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

valid for Sept 16, 2013 Support 1021-1026 20930-21130 Resistance 1035-1040 21500-21700

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Commodities Daily Report

`
Monday | 16 Sept, 2013
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Agricultural Commodities
Guar Complex
Guar complex which traded on a bullish note over the last 5 weeks on concerns over crop yield corrected sharply over the last two sessions on account of profit taking at higher levels. 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. Guar seed as well as Guar gum Futures settled 2.91% and 5.47% higher w-o-w. 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 8040 `/qtl 22974 `/qtl 22380 `/qtl 4.00 -10.43 3.34 Last Prev day 8264 -8.58

as on Sept 14, 2013 % change WoW -0.21 19.47 -0.85 21.56 MoM 62.54 99.01 66.23 94.44 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 8264.3 8040 7730 7720 18-Oct-13 -224.3 0 -

as on Sept 14, 2013 20-Nov-13 -534.3 -310 0 20-Dec-13 -544.3 -320 -10 0 as on Sept 14, 2013 20-Nov-13 -1573.8 -980 0 20-Dec-13 -1453.8 -860 120 0 as on Sept 12, 2013 Stocks as on 10th 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 22973.8 22380 21400 21520 18-Oct-13 -593.8 0 -

Stock Position at NCDEX warehouse

Location Deesa Bikaner Sriganganagar Stocks as on 11th 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
Guar prices may trade on a mixed note. Concerns over crop yield amid high temperature in Rajasthan and Haryana coupled with lower supplies, as farmers are also holding back their stocks expecting better realization in the coming days may support prices. However, overall higher output expectations due to higher acreage may cap sharp upside and pressurize prices at higher levels.

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 16, 2013 Support 7270-7350 7220-7300 20650-20830 21000-21180 Resistance 7500-7570 7440-7520 21180-21350 21530-21710

www.angelcommodities.com