Commodities & Currencies Weekly Trackerweb.angelbackoffice.com/Research_ContentManagement/commodit… · Commodities Weekly Tracker Monday | June 3, 2013 Silver Weekly Price Performance

Commodities & Currencies

Weekly Tracker

Commodities Weekly Tracker

Contents Returns

• Non Agri Commodities

• Currencies

• Agri Commodities

Non-Agri Commodities

• Gold

• Silver

• Copper

• Crude Oil

Currencies – DX, Euro, INR

Agri Commodities

• Chana

• Black Pepper

• Turmeric

• Jeera

• Soybean

• Refine Soy Oil & CPO

• Sugar

• Kapas

Monday | June 3, 2013

Commodities Weekly Tracker Monday | June 3, 2013

3.6

2.4

1.7 1.4

0.7

(0.3)(0.7)

(1.9)(2.0)

(1.0)

0.0

1.0

2.0

3.0

4.0 Currencies Weekly Performance


4.4

3.0

2.0

0.7 0.6

(0.1) (0.4)(0.9)

(1.9)(2.0)

(1.0)

0.0

1.0

2.0

3.0

4.0

Non-Agri Commodities Weekly Performance

*Weekly Performance for June contract,



Gold Weekly Price Performance

• Spot gold prices increased marginally by 0.1 percent in the last week. Gold marked a weekly high of $1421/oz and closed at $1386.40/oz at the end of the last week.

• In the Indian markets, prices closed on a positive note by 1.8 percent in the previous week to close at Rs.26874/10 gms on Friday, after touching a high of Rs. 27308/10 gms in the last week. Depreciation in the Indian Rupee supported upside in prices.

ETF Performance

• Holdings in the SPDR Gold Trust declined by 0.5 percent to 1,013.15 tonnes as on 31st May 2013 from previous level of 1,016.16 tonnes as on 24th May 2013.

Factors that influenced upside in gold prices

• Weakness in the US Dollar Index (DX).

• Rise in risk aversion globally acted as a positive factor for safe haven demand.

• However, sharp upside in prices was capped due to expectations of a pullback in the

bond -buying program of the Federal Reserve.

Outlook

• In the coming week we expect gold prices to trade on a negative note on the back of weak global markets.

• Further, expectations from markets that the Federal Reserve will cut its bond buying program will further exert downside pressure on prices.

• Decline in SDPR gold holdings will add more downside pressure.

• Depreciation in the Rupee will help to cushion sharp fall in gold prices on the MCX.

Weekly Technical Levels

• Spot Gold : Support 1,367/1,345 Resistance 1,415/1,442. (CMP: $1,394.20)

• Sell MCX Gold August between 27,180-27,220, SL-27,555, Target -26,500. (CMP: Rs 27,076)

1,350

1,400

1,450

1,500

1,550

1,600

1,650

1,700

1,750

1,800

25,500

26,500

27,500

28,500

29,500

30,500

31,500

MCX and Comex Gold Price Performance

MCX- Near Month Gold Futures - Rs/10 gms Comex Gold Futures - $/oz

79.0

80.0

81.0

82.0

83.0

84.0

85.0

1,350

1,400

1,450

1,500

1,550

1,600

1,650

1,700

Spot Gold Vs US Dollar Index

Spot Gold -$/oz US Dollar Index


Silver Weekly Price Performance

• Spot silver declined 0.8 percent in the last week and prices touched a low of $22.11 /oz, closing at $22.21/oz in at the end of the week.

• On the domestic front, prices increased 0.3 percent on account of depreciation in the Rupee . Silver closed at Rs.43616/kg on Friday, after touching a high of Rs.44925/kg in the prior week.

ETF Performance

• Holdings in the iShares Silver Trust declined 0.3 percent to 9,992.92 tonnes on 31st May 2013 from 10,022.95 tonnes on 24th May 2013.

Factors that influenced downside in silver prices

• Mixed Performance of Base Metals Complex.

• Weak economic data from the US and Euro Zone also exerted downside pressure on prices.

• But sharp downside in prices was capped due to upside in gold prices coupled with weakness in the DX.

Outlook • In the coming week we expect spot silver prices to decline, taking cues from

fall in spot gold prices coupled with expectations of unfavorable economic data from the US and Euro Zone.

• However, weakness in the DX along with upside in base metals group will cushion sharp fall in prices.

• Depreciation in the Indian Rupee will prevent sharp fall in prices on the MCX.


• Spot Silver: Support 21.84/21.47 Resistance 22.57/23.30. (CMP:$22.38)

• Sell MCX Silver July between 44,100-44,200, SL-44,851, Target -

42,700/42,300. (CMP: Rs.43,799)

22

24

26

28

30

32

42,000

44,000

46,000

48,000

50,000

52,000

54,000

56,000

58,000

60,000

MCX and Comex Silver Price Performance

MCX- Near Month Silver Futures - Rs/ kg Comex Silver Futures - $/oz

79.0

80.0

81.0

82.0

83.0

84.0

85.0

22.0

24.0

26.0

28.0

30.0

32.0

Spot Silver Vs US Dollar Index

Spot Silver -$/oz US Dollar Index


Copper Weekly Price Performance

• Copper prices closed on a flat note in the last week. But the trend was largely bearish and the metal touched a weekly low of $7198/tonne.

• On the domestic front, prices gained 1.3 percent as a result of depreciation in the Rupee and closed at Rs. 413.05/kg on Friday.

Copper Inventories

• LME copper inventories declined 1.8 percent last week and stood at 608,450 tonnes as on 31st May, 2013.

• Copper inventories in the warehouse monitored by the SHFE rose 1.5 percent and stood at 179,317 tonnes for the week ending on 31st May, 2013.

Factors that influenced downside in the copper prices

• Risk aversion in the global markets.

• Slow growth in US GDP coupled with rising unemployment in the Euro Zone.

• Sharp downside in prices was cushioned due to weakness in the DX and rise in US consumer confidence data.

• Decline in LME copper inventories.

Outlook

• In the coming week, we expect base metal prices to trade on a positive note on the back of weakness in DX, decline in LME inventories along with expected favorable manufacturing data from China.

• However, sharp upside will be capped as a result of weak global markets coupled with expectations of cut in Fed’s bond buying program.

• Depreciation in the Rupee will act as a positive factor for prices on the MCX.


• LME Copper: Support 7190/7105 Resistance 7370/7470. (CMP: $7373.0)

• Buy MCX Copper June between 407-406, SL-395, Target -422. (CMP: Rs 418.40)

365

375

385

395

405

415

425

435

445

455

6,800

7,000

7,200

7,400

7,600

7,800

8,000

8,200

8,400

LME and MCX Copper Price Performance

LME Copper Future ($/tonne) MCX Near Month Copper Contract (Rs/kg)

6,800

7,000

7,200

7,400

7,600

7,800

8,000

8,200

8,400

318,000

368,000

418,000

468,000

518,000

568,000

618,000

LME Copper v/s LME Inventory

Copper LME Inventory (tonnes) LME Copper Future ($/tonne)


Crude Oil Weekly Price Performance • On a weekly basis, Nymex crude oil prices declined around 2.3 percent. • On the domestic bourses, depreciation in the Rupee prevented the commodity

from closing in the red.

US Energy Department Facts and Figures • The US Energy Department (EIA) report showed that US crude oil inventories

increased unexpectedly by 3.0 million barrels to 397.60 million barrels for the week ending on 24th May 2013.

• Gasoline stocks fell by 1.5 million barrels to 219.20 million barrels, whereas distillate stockpiles rose by 1.9 million barrels to 120.70 million barrels for the last week.

Factors that influenced downside in crude oil prices • Unexpected rise in the US crude oil inventories. • Organization of Petroleum Exporting Countries (OPEC) maintained its oil output

quota at 30 million barrels a day. • US GDP grew at a slower pace. • Unfavorable economic data from the US and the Euro Zone. • Weakness in the Dollar Index cushioned fall in oil prices.

Outlook • For the coming week, crude oil prices are expected to trade lower on the back

of forecast of rise in the crude oil inventories coupled with an unchanged production quota at 30 million barrels a day from OPEC .

• Additionally, weak global markets and expectations of cut in bond buying program from US federal Reserve will act as a negative factor for prices.

• However, sharp downside will be cushioned on account of weakness in DX. • Depreciation in the Indian Rupee will prevent sharp fall in prices on the MCX.

Weekly Technical Levels • Nymex Crude Oil: Support: 90.15/88.67 Resistance 93.05/94.60. (CMP:$91.51) • Sell MCX Crude June between 5265-5285, SL-5331, Target -5155. (CMP:Rs

5199)

86.0

88.0

90.0

92.0

94.0

96.0

98.0

4,700

4,800

4,900

5,000

5,100

5,200

5,300

5,400

Nymex and MCX Crude Oil Price Performance

MCX crude oil (Rs/bbl) NYMEX Crude Oil ($/bbl)

361.3

360.3

363.1369.1

371.7

372.2

376.4

377.53

381.4

384

382.7

385.9

388.6 388.9

387.6

388.6

395.3 395.5

394.9 394.6

397.6

360

365

370

375

380

385

390

395

400

Crude Oil Inventories (mn barrels)


DX/ INR Weekly Price Performance

• US Dollar Index (DX) declined around 0.4 percent in the last week.

• The Indian Rupee depreciated around 1.4 percent on weekly basis.

Factors that influenced downside movement in the DX

• In the initial part of the week, the currency declined on the back of rise in risk appetite in the global markets.

• Favorable US consumer confidence and sentiments data added downside pressure.

• However, in the later part of the week , weakness in the global markets cushioned sharp fall along with slow growth in the US GDP.

Factors that influenced movement in the Rupee

• Inflation expectations remained on the higher side.

• High current account deficit.

• Heavy dollar buying from defense related companies and month end requirement of oil importers.

• However, sharp downside in the currency was cushioned as a result of weak domestic and global market sentiments, growth in country’s GDP coupled with weakness in the DX.

FII Inflows

• For the month of May 2013, FII inflows totaled at Rs.22,168.60 crores ($4,042.64 million) as on 31st May 2013. Year to date basis, net capital inflows stood at Rs.83,205.10 crores ($15,353.0 million) till 31st May 2013.

Outlook

• In the coming week, Rupee is expected to depreciate due to dollar demand from gold and oil importers, weak global market sentiments along with unfavorable economic data.

• However, weakness in the DX will cushion sharp fall in the currency.


• USD/INR MCX June Support 56.25/55.70 Resistance 57.25/57.60. (CMP: 56.87)

• US Dollar Index: Support 82.60/82.0 Resistance 83.80/84.40. (CMP: 83.01)

53.0

53.5

54.0

54.5

55.0

55.5

56.0

$/INR - Spot

79.0

80.0

81.0

82.0

83.0

84.0

US Dollar Index


Euro Weekly Price Performance

• The Euro appreciated 0.5 percent last week, touching a weekly high of 1.3061.

Factors that influenced upside movement in the Euro

• Weakness in the DX coupled with mixed global markets sentiments.

• However, sharp upside was capped on account of unfavorable economic data from the region along with rise in the unemployment rate of the Euro region.

News

• German Retail Sales declined 0.4 percent in April as against a fall of 0.5 percent in March. French Consumer Spending fell by 0.3 percent in April from rise of 1.3 percent in March.

• Italian Monthly Unemployment Rate increased to 12 percent in last month when compared to increase of 11.9 percent in March. European Unemployment Rate grew to 12.2 percent in April from rise of 12.1 percent in March.

• German Unemployment Change increased by 21,000 in April as against a rise of 6,000 in March.

Outlook

• In the coming week, we expect the Euro to depreciate on the back of rise in risk aversion in the global markets.

• Further, rise in the Euro Zone unemployment rate will also exert downside pressure on the currency.

• However, sharp downside in the currency will be cushioned on account of weakness in the DX coupled with expectations of favorable economic data from the region.


• EURO/USD SPOT: Support 1.288/1.275 Resistance 1.312/1.325. (CMP: 1.303)

1.275

1.285

1.295

1.305

1.315

1.325

1.335

1.345

1.355

1.365

Euro/$ - Spot

69.0

69.5

70.0

70.5

71.0

71.5

72.0

72.5

73.0

73.5

74.0

EURO/INR - Spot

Chana


Weekly Price Performance

• Higher supplies and record output expectations led chana prices to hit fresh contract lows of Rs. 3105 per qtl in the June contract. However, emergence of fresh demand at lower levels led to some recovery in the prices towards the later part of the week.

• Chana spot as well as June futures settled 0.4% and 4.6% lower w-o-w.

Timely arrival of monsoon to boost Kharif Pulses sowing

• Monsoon has finally hit Kerala coast on time and is expected to progress soon in other part of southern India. This has raised expectatations over sowing as kharif Pulses are mainly grown in the western and southern belts of India.

Chana output estimated at record high - Third Advance Estimates

• According to the third advance estimates released last week, Chana output is pegged marginally lower to 8.49 mn tn compared with its second advance estimates of 8.57 million tonnes. Chana output is expected to breach its 2010-11 record of 8.2 mn tn in 2012-13.

Seasonal pattern to restrict further downside in the prices

• Chana prices tend to follow a seasonality pattern, wherein prices decline during the harvesting period (Apr-May) and bottom out when arrivals reach their peak in the month of May. Thus, taking cues from seasonality pattern , chana prices are set to recover from the current month (June as arrival will decline gradually.

Outlook

• Chana prices are expected to remain sideways as arrivals will gradually start declining in the coming weeks which may restrict further downside in the prices.. Also prices are hovering around the MSP levels below which farmers will not liquidate their stocks.

Weekly Strategy

• Sell NCDEX CHANA July between 3255-3265, SL -3370, Target - 3100 / 3050

Turmeric

Source: Agriwatch & Reuters



• Turmeric Futures continued to decline last week as huge carryover stocks coupled with weak demand due to high temperatures kept prices under pressure. However, buying by stockists supported prices at lower levels.

• The spot as well as the futures settled 0.5% and 2.8% lower w-o-w.

Weak exports data

• Turmeric exports during Apr-Jan 2013 declined by 4% to 66,550 tn. (Source Factiva)

Modification in Tick size and Lot size

• NCDEX issued a circular earlier this month that it will modify the tick as well as the lot size in the Turmeric contract. However the exchange later announced that it has kept the circular issued earlier has been kept in abeyance till further notice.

Lower acreage of Turmeric for the 2012-13 season

• Production of turmeric may decline in 2012-2013 season due to weak monsoon as well as lower turmeric prices. The area covered under Turmeric in A.P. as on 10th October, 2012 has been reported at 0.58 lakh hectares. The area covered is lower as compared to last year (0.81 lha), as well as normal as on date (0.67 lha). Sowing is reported to be 30-35% lower compared to last year.

Lower production in the 2012-2013 season

• Turmeric production in 2012-13 is expected around 50% lower compared to last year and is expected around 45-50 lakh bags. Production in 2011-12 is reported at historical high of 90 lakh bags/ 10.62 lakh tns.

Outlook

• Prices are expected to trade on a negative note this week as huge stocks as well as weak demand may continue to pressurize prices. However, prices may recover from lower levels as farmers may hold back their stocks. Also export demand may emerge at lower levels ahead of Ramadan and the summers start to cool down.

Weekly Strategy • Sell NCDEX Turmeric July between 5810-5850, SL -6030, Target - 5550 / 5450.


Source: Reuters & Angel Research.

Jeera

Source: Ministry of Agriculture, Gujarat.



• Jeera futures corrected from higher levels due to higher arrivals in the spot market. The demand also did not pick up as expected. However, expectations of improvement in the overseas demand in the coming weeks limited the downside in the prices. Higher production estimates have capped sharp gains in the prices. Prices had declined over the last few months due to higher sowing. The 3 years’ average sowing is reported at 3.189 lk ha. About 25-30% of the new crop from Gujarat has already been exported to Singapore, Europe & Dubai.

• The spot as well as the Futures settled 1.07% and 2.11% lower w-o-w.

Second consecutive year of higher output

• India’s 2013 Jeera output is estimated at 40-45 lakh bags (of 55kgs each), higher than 40 lakh bags in 2012. However, increase in the exports due to supply concerns in the global markets offset the impact of higher supplies on the prices and thus, medium term fundamentals remain supportive for the upside.

Global supply concerns boost Jeera exports

• Jeera exports during Apr-Jan 2013 stood at 64,400 tn, higher by 86% (Source Factiva).

• Due to lower production in Syria and Turkey, coupled with the ongoing tensions between them, exports are not taking place and have been diverted to India. They have stopped shipments. Turkey may start offering its Jeera in the coming days.

International Scenario

• According to reports, production in Syria is reported around 22,000 tonnes while production in Turkey is reported between 5000-7000 tonnes, lower by 20% and around 50% respectively, raising supply concerns in the international markets.

• Indian Jeera in the international market is being offered at $2,450/tn (c&f).

Outlook

• Jeera may decline due to higher output coupled with good arrivals. However, expectations of overseas demand may support prices at lower levels.

Weekly Levels • Sell NCDEX Jeera July between 13300-13350, SL -13700, Target - 12800 / 12600.


Source: Reuters & Angel Research.

Soybean


Weekly price performance

• Soybean declined for the fourth straight week and settled 1.91% lower on expectations normal monsoon and higher returns will boost sowing this season.

• CBOT Soybean July gained 2% w-o-w on the back of delayed planting coupled with tight soybean stocks and good demand for US soy meal.

India's soy meal Exports Fall by 68 Percent during FY12-13 – SEA

• India’s soy meal exports for the month of April 2013 were 99.451 tonnes, lower by 68.31 percent from 313,832 tonnes a year ago.

Increase in the output in the 3rd Advance Estimates

• As per the 3rd Advance Estimates released by the Ministry of Agriculture, soybean output increased to 14.14 mn tn from 12.24 mn tn in the previous estimates.

Delay in shipments from Brazil

• Heavy rainfall in Brazil caused has hampered the loading of soybeans at the Brazil ports, leading to a delay in the shipments.

South American Soybean Exports Seen at Record High- Oil World

• Brazil, set to become the world’s largest soybean exporter, may ship a record 7.6 million tons of the oilseed in May after permitting ports to operate 24 hours a day, from a previous 8-hour limit.

US Soy planting- 44% complete

• According to the USDA weekly crop report, Soybean planting has been delayed due to heavy rains in the US Midwest and is reported at 44%. However, it is much lower as against 87% last year and five year average of 61%.

Outlook • Soybean prices may trade with upward bias in the current week as firm international

markets as a result of delayed planting may support domestic soybean prices.

Strategy

• Buy NCDEX Soybean July between 3710-3700, SL -3620, Target - 3820 / 3840.

Refine Soy Oil and Crude Palm Oil


Weekly price performance

• Edible oils continued to remain in the positive territory last week as lower stocks and seasonally lower yield period of Malaysian Palm Oil continued to support prices. Ref Soy oil on NCDEX as well as CPO prices at MCX settled 0.19% and 1.24% higher w-o-w.

Global Scenario

• Exports of Malaysian palm oil products for May declined 3.4 percent to 1,248,014 tonnes from 1,292,371 tonnes shipped during April.

• Stocks data from industry regulator the Malaysian Palm Oil Board showed inventory levels at the end of April down 11.3 percent to 1.93 million tonnes against the previous month's 2.17 mn tn. But exports of palm oil products for May 1-10 slid 16.7% to 380,047 tn.

Domestic Scenario

• As per the data released by the The Solvent Extractors' Association of India Imports of all vegetable oils, including non-edible oils, by India, declined 29.23% in April 2013, to 654,827 tonnes from 925,334 tonnes in April 2012 due to high stocks lying at the ports.

• Stockpiles of edible oil at ports on May 1 stood at 670,000 tn, the trade body said, off a record of 930,000 tn on March 1. “Stocks were still on the higher side despite the decline in monthly imports.

• India's imports of palm oil could rise more than 17% in the year to October 2013 to stand at 9 mn tn, compared with 7.67 mn tn of palm oil in 2011/12 as the edible oil is the cheapest available, despite an import duty.

Strategy

• Buy NCDEX Ref Soya Oil July between 690-692, SL -681, Target - 704 / 710.

• Buy MCX CPO June between 481-479, SL -473, Target - 491 / 493.

Sugar



• After showing some signs of recovery , sugar prices remained flat last week as higher supplies continue to offset demand ahead of festive season.

• ICE as well as Liffe Sugar remained under downside pressure last week on account of good progress of harvesting and crushing in brazil.

Sugarcane acreage likely to fall 10% this kharif season • The sowing area under sugarcane is likely to decline by 10 per cent this season

following shortage of water in major producing states including Maharashtra, Tamil Nadu and Karnataka. (Source: Business Standard)

• Data compiled by the agriculture ministry showed planting is completed in 41.24 lakh ha compared with 46 lakh hectares.

India sugar reserves at five-year high set to avert imports

• Sugar inventories in India, are poised to surge by 37% to 9.2 million tonnes at the start of October, a five-year high as exports halt because of slumping global prices. Exports have plunged to about 35,000 tonnes since 1 October from 3.4 million tonnes in 2011-2012.

Brazil's CS sugar output up 40 percent yoy

• Sugar and ethanol mills in Brazil's main center-south cane belt made strong progress harvesting record crop through mid-May, producing more than twice the amounts of sugar and ethanol than they did from last season's smaller cane crop. Mills in the region benefited from dry weather in late April and early May and produced mn tn of sugar, up 40 percent from a year ago.

Outlook

• Sugar prices are expected to recover on account of improvement in demand from the bulk manufacturers coupled with lower cane planting figures. However, weak international markets may keep sharp upside capped.

Strategy

• Buy NCDEX SUGAR July between 3090-3080, SL -3040, Target - 3145 / 3160

Kapas/Cotton



• Kapas as well as cotton traded on a bullish note and settled 5.57% and 3.5% higher last week on the back of pick up in demand for yarn mixed coupled with extreme hot weather. However, offloading of stocks from the state reserves capped sharp gains.

• ICE Cotton futures declined 2.61% last week as worries of a potential slowdown in China coupled with improving weather in the US easing sowing concerns.

Increase in the planting in India.

• Cotton planting in India is reported at 11.86 lakh ha as against 10.4 lakh ha last year.

Government selling cotton through e-auction

• Cotton Corporation & NAFED are expected to offload 8 lakh bales at lower prices. CCI offered 38100 bales last week through e-auction.

Cotton Advisory Board sees lower kharif sowing

• CAB in its latest meet 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 million bales last year to 23.5 million bales.

• Exports are estimated at 8.1 mn bales. While Import are estimated 2.5 mn bales.

US Cotton planting to determine cotton prices

• As on 27h May, Cotton planting was 59% completed in the US compared to 39% last week and average of 69% in the last five years. However, Planting is expected to pick up as weather improved in Mississippi Delta and into the Southeast United States .

Outlook

• Cotton prices may trade with a positive bias this week on account of improvement in the demand for yarn. Millers are also buying actively towards the end of the season. Extreme hot weather is also supportive for the prices. Farmers are also holding back their stocks. Any recovery in international markets may also support prices. However, offloading more stocks in the local markets from state reserves may exert pressure on the domestic cotton prices.

Strategy

• Buy MCX Cotton June between 18610-18590, SL -18300, Target - 19000 / 19150.

Thank You!

Angel Commodities Broking Pvt. Ltd. Registered Office: G-1, Ackruti Trade Centre, Rd. No. 7, MIDC, Andheri (E), Mumbai - 400 093. Tel: (022) 3083 7700 Corporate Office: 6th Floor, Ackruti Star, Central Road, MIDC, Andheri (E), Mumbai - 400 093. Tel: (022) 2921 2000 MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX : Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302 Disclaimer: The information and opinions contained in the document have been compiled from sources believed to be reliable. The company does not warrant its accuracy, completeness and correctness. The document is not, and should not be construed as an offer to sell or solicitation to buy any commodities. This document may not be reproduced, distributed or published, in whole or in part, by any recipient hereof for any purpose without prior permission from “Angel Commodities Broking (P) Ltd”. Your feedback is appreciated on [email protected]


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Commodities & Currencies Weekly Trackerweb.angelbackoffice.com/Research_ContentManagement/commodit… · Commodities Weekly Tracker Monday | June 3, 2013 Silver Weekly Price Performance