Commodities Weekly Tracker, 22nd April 2013

7/28/2019 Commodities Weekly Tracker, 22nd April 2013

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Commodities & Currencies

Weekly Tracker


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Commodities Weekly TrackerContents

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 | April 22, 2013


3/20

Commodities Weekly TrackerMonday | April 22, 2013

1.1

0.5

(0.5)

(0.7) (0.7)

(0.9)

(1.3) (1.3)(1.5)

(1.0)

(0.5)

0.0

0.5

1.0

Currencies Weekly Performance


4/20


3.1

1.90.4

(1.3)

(3.6)(4.3)

(5.0)(6.2)

(10.4)(10.5)

(8.5)

(6.5)

(4.5)

(2.5)

(0.5)

1.5

Non-Agri Commodities Weekly Performance


5/20

*Weekly Performance for April contract



6/20


GoldWeekly Price Performance

Spot gold prices declined around 5 percent in the last week. The yellow metal touched

a weekly low of $1,321.35/oz and closed at $1403.85/oz in the last trading session of

the week. In the Indian markets, prices fell by 8.4 percent in prior week and closed at

Rs.25804/10 gms on Friday after touching a low of Rs.25,270/10 gms in the last week.

ETF Performance

Holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-traded

fund, declined by 3.06 percent to 1,123.06 tonnes as on 19th April 2013 from

previous level of 1,158.56 tonnes as on 12th Apri l 2013.

Factors that influenced downside in gold prices

Weak global market sentiments coupled with strength in DX. Further, rise in theworries among the investors that the Cyprus may have to sell the gold reserves which

may be followed by the other euro nations to aid there financial imbalances exerted

downside pressure on the prices.

Additionally, Federal Reserve Meeting Minutes showed that many policymakers were

in favor of ending the bond buying program earlier also acted as a negative factor.

Apart from this ease in the Inflation data from major economies and decline in the

Chinas GDP growth pushed the prices lower.

Outlook In the coming week, we expect gold prices to trade on a negative note as a result of

rise in risk aversion in the global market sentiments coupled with strength in the DX.

Further, expectations of favorable economic data from US and Euro Zone will led to

decline in safe haven demand from the investors. Appreciation in Indian Rupee will

exert downside pressure in prices on MCX

Weekly Technical Levels

Spot Gold : Support 1,320/1,233 Resistance 1,493/1582. (CMP: $1420.60)

Sell MCX Gold June between 27,200-27,250, SL-28,025, Target -25,150 (CMP:

Rs.26,217)

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

79.5

80.0

80.5

81.0

81.582.0

82.5

83.0

83.5

84.0

1,350

1,400

1,450

1,500

1,550

1,600

1,650

1,700

Spot Gold Vs US Dollar Index

Spot Gol d -$/oz US Dol lar Inde x


7/20


SilverWeekly Price Performance

Spot silver declined 10.4 percent in the last week. The white metal prices

touched a weekly low of $22.04/oz and closed at $23.17/oz in last trading

session of the week.

On the domestic front, prices decreased by 13.2 percent taking cues from

spot silver prices and closed at Rs.42,924/kg on Friday after touching a low

of Rs.42,410/kg in the last week.

ETF Performance

Holdings in the iShares Silver Trust, the world's largest silver-backed

exchange-traded fund, decline by 0.4 percent to 10,451.01 tonnes as on

19th April 2013 from previous level of 10,497.59 tonnes as on 12th April

2013.Factors that influenced downside in silver prices

Fall in gold prices

Downside in the base metals.

Weak global market sentiments and strength in DX

Unfavorable economic data from Europe, US and China

Outlook In the coming week, we expect silver prices to trade lower taking cues

from fall in the gold prices coupled with downside in base metals complex. Additionally, strength in the DX will exert more downside pressure on the

prices.

In the domestic markets, appreciation in the Indian Rupee will add

downside pressure on the prices on the MCX.


Spot Silver: Support 21.42/19.67 Resistance 23.75/25.50. (CMP:23.44)

Sell MCX Silver May Between 44,700-44,800, SL-46,501, Target -41,150.

(CMP:43631)

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 Si lver Futures - Rs/ kg Comex Si lver Futures - $/oz

79.0

79.5

80.0

80.5

81.0

81.5

82.0

82.5

83.0

83.5

84.0

22.0

24.0

26.0

28.0

30.0

32.0

Spot Silver Vs US Dollar Index

Spot Silve r -$/oz US Dollar Inde x


8/20


CopperWeekly Price Performance

Copper prices declined by 6.2 percent in the previous week. The red metal a

weekly low of $6800/tonne and closed at $6967.5/tonne in the last trading

session of the week.

On the domestic front, prices dropped by 7.4 percent as a result of appreciation in

the Indian Rupee and closed at Rs. 374.7/kg on Friday after touching a low of

Rs.368.7/kg in the last week.

Copper Inventories

LME copper inventories gained around 3.4 percent in the last week and stood at

614,350 tonnes as on 19th April, 2013 as against 593,650 tonnes as on 12th April,

2013.

Copper inventories in the warehouse monitored by the Shanghai fell by 2.0percent and stood at 223,663 tonnes for the week ending on 19th April, 2013.

Factors that influenced downside in the copper prices

Weak global market sentiments coupled with strength in DX.

Unfavorable economic data from major global economies.

Rise in LME inventories by 3.4 percent along with cut in global economic growth

forecast by IMF.

Outlook

Copper prices are expected to trade on a negative note on the back of risinginventories, negative data from China, IMF cut the global economic growth

forecast along with weak global market sentiments.

However, sharp downside in the prices will be cushioned as a result of US GDP

expected to come on a positive note.

Appreciation in Indian Rupee will exert downside pressure in prices on MCX.


LME Copper: Support 6700/6432 Resistance 7070/7330. (CMP: $6927.0)

Sell MCX Copper April between 383-385, SL-398, Target -363. (CMP:374.20)

375

385

395

405

415

425

435

445

455

6,900

7,100

7,300

7,500

7,700

7,900

8,100

8,300

LME and MCX Copper Price Performance

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

6,900

7,100

7,300

7,500

7,700

7,900

8,100

8,300

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)


9/20


Crude OilWeekly Price Performance On a weekly basis, Nymex crude oil prices declined around 3.6 percent.

On the domestic bourses, prices declined by 4.7 percent as a result of

appreciation in the Indian Rupee and closed at Rs.4749/bbl on Friday aftertouching a low of Rs.4664/bbl in the last week.

US Energy Department Facts and Figures As per the US Energy Department (EIA) report, US crude oil inventories

declined unexpectedly by 1.2 million barrels to 387.60 million barrels for theweek ending on 12th Apri l 2013.

Gasoline stocks fell by 0.6 million barrels to 221.70 million barrels and whereasdistillate stockpiles rose by 2.4 million barrels to 115.20 million barrels for thelast week.

Factors that influenced downside in crude oil prices Rise in risk aversion in the global market sentiments which led to expectations

of decline in demand for the fuel.

Strength in the DX

Sharp downside cushioned as a result of unexpected decline in US crude oilinventories.

Outlook We expect crude oil prices to trade on negative note on the back of rise in risk

aversion in the global market sentiments coupled with stronger DX.

Further, cut in demand forecast by IEA and OPEC, unfavorable economic datafrom China along with forecast for decline in economic growth by IMF willexert downside pressure on the prices.

However, sharp downside in the prices will be cushioned as a result of US GDPexpected to come on a positive note.

Appreciation in Indian Rupee will exert downside pressure in prices on MCX.

Weekly Technical Levels Nymex Crude Oil: Support: 85.75/83.25 Resistance 89.50/91.70 (CMP:88.94)

Sell MCX Crude May between 4870-4890, SL-4981, Target -4665.(CMP:4827)

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

M CX crude oil (Rs/bbl) NY MEX Crude Oi l ($/bbl)

361.3

360.3

363.1

369.1

371.7

372.2

376.4

377.53

381.4

384

382.7

385.9

388.6 388.9

387.6

360

365

370

375

380

385

390

Crude Oil Inventories (mn barrels)


10/20


DX/ INRWeekly Price Performance

US Dollar Index (DX) gained around 0.5 percent in the last week.

The Indian Rupee appreciated around 0.9 percent on weekly basis.

Factors that influenced upside movement in the DX

Rise in risk aversion in the global market sentiments which led to increase in demand

for the low yielding currency.

Additionally, unfavorable economic data from US, Euro Zone and China also supported

an upside in the currency.

Further, US equities traded on a weak note which also acted as a positive factor for the

DX.

Factors that influenced movement in the Rupee

Positive wholesale price index (WPI) coupled with favorable trade balance data.Additionally, domestic equities trading on an upbeat note along with expectations of

cut in the key rates by the central banks in the monetary policy to be announced on 3rd

May 2013 also supported an upside in the currency.

However, sharp upside in the currency was capped as a result of strength in the DX and

dollar demand from importers and custodian banks.

FII Inflows

For the month of April 2013, FII inflows totaled at Rs.595.90 crores ($110.89 million) as

on 18th April 2013. Year to date basis, net capital inflows stood at Rs.56,218.20 crores

($10,421.0 million) till 18th April 2013.Outlook

We expect Indian Rupee to appreciate in the current week on back of faorable

economic data from the country along with expectations of but in key rates by the

central bank in its stimulus measures declared on 3rd May 2013. However, sharp

upside in the currency will be capped as a result of weak global market sentiments

coupled with strength in the DX.


USD/INR MCX March Support 54.10/53.70 Resistance 55.30/56.0 (CMP: 54.168)

US Dollar Index: Support 82.0/81.40 Resistance 83.30/83.80 (CMP: 82.80)

53.0

53.5

54.0

54.5

55.0

55.5

56.0

$/INR - Spot

79.0

79.5

80.0

80.5

81.0

81.5

82.0

82.5

83.0

83.5

US Dollar Index


11/20


EuroWeekly Price Performance

The Euro depreciated by 0.5 percent in the last week. The Euro touched a low of

1.3045 in the last week and closed at 1.3051 against dollar on Friday.

Factors that influenced upside movement in the Euro

Weak global market sentiments coupled with strength in DX.

Further, European Central Bank (ECB) governing council member Jens

Weidmann said that central bank may cut the interest rates if economic

conditions demand for it added downside pressure.

Additionally, unfavorable economic data from Europe acted as a negative factor

for the currency.

However, sharp decline in the currency was cushioned as the ECB president

Draghi said that central back expects Euro zone economy to recover steadily inthe second half of the year.

News

German Producer price index (PPI) decreased by 0.2 percent in March as

compared to decline of 0.1 percent in February. Europe Current Account was at

surplus of 16.3 billion Euros in February as against a previous surplus of 13.8

billion Euros a month ago.

German Zentrum fur Europaische Wirtschaftsforschung (ZEW) Economic

Sentiment declined by 12.2 points to 36.3-mark in April with respect to rise of

48.5-level in March. European ZEW Economic Sentiment fell by 8.5 points to24.9-level in April as compared to rise of 33.4-mark a month ago.

Outlook

We expect the Euro to trade on negative note on the back of expectations of

unfavorable economic data from the country. Further, rise in risk aversion in the

global market sentiments coupled with strength in the DX will exert downside

pressure on the currency.


EURO/USD SPOT: Support 1.296/1.287 Resistance 1.317/1.328 (CMP: 1.3041)

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

EURO/INR - Spot


12/20

Chana


Weekly Price Performance

Chana prices which rose sharply during the two consecutive weeks, declined

last week on account of increasing arrivals & subdued demand at higher levels.

On a weekly basis, Chana spot as well as May futures settled 1.4% & 2.3% lower.

Rising inflows at higher levels

Higher prices since the beginning of the month has led to a significant increase in

arrivals last week which dragged prices lower.

Chana output estimated at 8.5 mn tn

Chana output is expected to breach its 2010-11 record of 8.2 mn tn and is

estimated at 8.57 mn tn for 2012-13. However, according to market sources,

output may revised marginally lower due to unfavorable weather conditions.

Punjab may offer higher MSP on Pulses

To encourage diversification, the Punjab state government is considering setting

up of state costs and price commission for crops like soybean and pulses, and

offering state minimum support price (MSP) on them.

World pulses market well-balanced

At the International Pulse Trade and Industries Confederation annual

convention, field pea production for 2013-14 was estimated at 10.8 mn tn (9.9

mt). World dry bean production was estimated at 21.3 mt (21.2 mt), however,

world lentil production is projected to be slightly lower at 3.67 mt (3.73 mt). In case of chick pea (desi), production is seen up at 9.7 mt from 9.4 mt. in 2012-

13 following a huge spurt in Pakistan crop.

Outlook

Chana may decline in the early part of the week on account of increasing

inflows. However, fresh demand will emerge at lower levels which will again

push prices higher towards the end of the week.

Weekly Strategy

Sell NCDEX CHANA May between 3640-3680, SL -3755, Target - 3520 / 3500


13/20

Black Pepper

Source: Reuters & Angel Research



Pepper Futures declined last week on account of higher supplies from Karnataka

coupled with weak export demand. However lower supplies as well as gooddemand for Kerala crop supported prices at lower levels. Low stocks in the

exchange accredited warehouses also supported prices..

The Spot as well as the Futures settled 0.91% and 0.7% lower w-o-w.

Indian Pepper is being offered at $6,900/tn (C&F NY). Vietnam and Brazil Austa is

quoted at $6,925-6,975/tn and $6,600/tn, Indonesia GM-1 is quoted at $6,900/tn

Averages daily arrivals stood at 35 tn while offtakes stood at 35 tn last week.

Expectations of higher output in 2012-13

According to IPC, Pepper production is expected around 55,000 tn in 2013 and

carryover stocks of about 15,066 tn.

India Apr-Jan 2013 pepper exports stood at 11,500 tn, lower by 48%. (Source Factiva)

Global updates

Global pepper production in 2012 is projected at 3.27 lk tn vis--vis 3.17 lk tn in

2011. Vietnam pepper exports in 2012 stood at 116,962 mt. Pepper production

from Vietnam decreased to 1.05 lk tn in 2012 from 1.1 lk tn in 2011. Harvesting of

the fresh crop from Vietnam will commence in the coming days.

Exports from Brazil during Jan-Nov 2012 are reported at 25900 tn, as against

32650 tn in the same period last year, down by about 20%.Outlook

Pepper Futures is expected to trade sideways with a negative bias this week.

Higher arrivals of the Karnataka crop coupled with weak overseas demand may

pressurize prices at higher levels. However, Good interstate demand for the

Kerala pepper coupled with low supplies may support the prices. Lack of stocks

for delivery due to lock up of pepper in the NCDEX accredited warehouses may

also support prices.

Weekly Strategy Sell NCDEX Pepper May between 35500-35600, SL -36450, Tgt - 34250 / 34050.

Source: Reuters & Angel Research.


14/20

Turmeric

Source: Agriwatch & Reuters

Commodities Weekly Tracker


Turmeric Futures traded on a negative note last week on account of good arrivals

of the new crop. Higher carryover stocks also added to the downside pressure.

However, good overseas as well as demand from interstate buyers supported

prices at lower levels. Lower output expectations for 2012-13 crop on the back of

poor sowing also supported the prices. Sowing is reported to be 30-35% lower

compared to last year.

According to the weather department, rainfall in the key grown region (Southern

Peninsula) is reported at 10% below normal. The spot as well as the futures

settled 0.41% and 6.81% lower w-o-w.

Weak exports data

Turmeric exports during Apr-Jan 2013 was lower by 4% at 66,550 tn.(Source Factiva)

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).

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

Turmeric may remain under downside pressure this week as higher arrivals of the

new crop may keep prices on the downside. Huge carryover stocks may also

pressurize prices. However, good demand from the overseas as well as the

domestic markets may support prices at lower levels. Lower production estimates

coupled with arrivals of good quality crop may also support prices at lower levels.

Weekly Strategy

Sell NCDEX Turmeric May between 6750-6800, SL -7170, Target - 6200 / 6120.




15/20

Jeera

Source: Ministry of Agriculture, Gujarat.

Commodities Weekly Tracker


Jeera declined last week as arrivals pressure kept prices on the downside.

However, overseas demand coupled with higher exports data supported the

prices in the spot. Sowing in Gujarat was reported at 3.244 lk ha till Jan 2013. Last

3 years average sowing is 3.189 lk ha. Stocks are reported at around 5-6 lk bags.

The spot as well as the futures settled 1.75% and 5.18% lower w-o-w. .

Second consecutive year of higher output

Indias 2013 Jeera output is estimated at 38-40 lakh bags (of 55kgs each), at par

with the production 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 tons while

production in Turkey is reported between 5000-7000 tons, lower by 20% and

around 50% respectively, raising supply concerns in the international markets.

Indian Jeera in the international market is being offered at $2,600/tn (c&f).

Outlook

Jeera is expected to trade with a negative bias this week as higher arrivals of the

new crop is expected to pressurise prices. However, strong overseas demand may

support prices at lower levels. Farmers may also be unwilling to sell their stocks at

lower levels and may hold back their stocks.

Weekly Levels Sell NCDEX Jeera May between 13500-13550, SL -14050, Target - 12750 / 12650.




16/20

Soybean


Weekly price performance

NCDEX Soybean futures declined 3.36% last week on account of weak soy meal

demand and rising supplies of rabi oilseeds. On contrary, CBOT soybean recovered

0.19% last week.

India's soy meal Exports Fall by 12 Percent during FY12-13 SOPA

The annual soy meal exports in the FY 2012-2013 (April-March) were 34,33,916.546

tons, decreased by 12.28 percent from 39,14,683.205 tons a year ago.

India soy meal exporters renegotiate deals with Iran

Indian soy meal suppliers are renegotiating deals with Iranian buyers for April and

May shipments as demand for Indian soy meal has slowed significantly due to the

higher prices, and buyers are seeking alternative South American supplies.

Indias soy meal exports in April are likely to fall to 200,000 tonnes, down 36 percentfrom a year ago, unless buying from Iran improves.

Brazil congestion delays export of record soybean crop

Soybean and corn harvests have reached all-time highs and Brazil looks set to

become the world's top exporter of soybean.

Most of Brazil's soybean harvest goes to China, where it is fed to chickens and used

to make tofu, soymince etc. However, recent rains have caused delay ion shipments.

Bad weather threatening Argentine soybean crop -Oil World

Private analytics firm Informa Economics raised its estimate for Argentina's 2012/13crop to 52 million tonnes, from 51 million previously, but lowered its figure for

Brazil's soy crop to 83.25 million tonnes, from 84.5 million last month.

Outlook

Weak soy meal exports from India amid uncompetitive quotes may exert downside

pressure on the domestic soybean prices. However, if international markets recover

on Argentina crop concerns, then Indian exports may turn competitive.

Strategy

Sell NCDEX Soybean May between 3930-3980, SL -4150, Target - 3670 / 3630


17/20

Refine Soy Oil and Crude Palm Oil


Weekly price performance

Edible oil complex remained under downside taking cues from the weak palm

oil futures at KLCE. CPO prices at MCX and KLCE settled 0.4% and 1.6% loweron account of weak exports. However, seasonally lower yield period of

Malaysian palm oil and firm soy oil restricted sharp fall. Soy oil settled 2.4%

and 0.1% lower in NCDEX and CBOT respectively due to comfortable supplies.

Global Scenario

Exports of Malaysian palm oil products for April 1-20 fell 6.4 percent to

864,206 tonnes from 922,987 tonnes shipped during March 1-20

Malaysia, the world's No.2 palm oil producer, will set its crude palm oil export

tax for May at 4.5 percent, unchanged from April. The Southeast Asian

country calculated a reference price of 2,347.26 ringgit per tonne for crudepalm oil for May.

Domestic Scenario

Indias imports of palm oil fell for a second straight month in March, as

domestic supply improved and purchases by the worlds biggest buyer

continued to suffer from an import levy imposed in January.

Imports of all vegetable oils, including non-edible oils, fell 7.5 per cent to

896,714 tn in March, pulled down by the drop in palm oil imports.

Stockpiles of edible oil at ports fell nearly nine percent during March to

850,000 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

Sell NCDEX Ref Soya Oil May between 706-710, SL -723, Target - 686 / 683

Sell MCX CPO May between 458-462, SL -473, Target - 441 / 438


18/20

Sugar



Sugar prices settled 0.58% lower w-o-w as higher supplies is seen offsetting the

summer demand. Liffe sugar settled 2.6% lower w-o-w on hopes brazils cane harvest will pick pace

as cane zones dry out.

Indias 2012-13 Sugar production declines 2 per cent

The mills crushed about 240 mln tonnes of sugarcane into 24.11 mn tn of sugar,

white value, by April 15, which is 1.9% less than the 24.571 mln produced by this

time last year. The sugar recovery rate is down at 10.11% this season from

10.29% a year ago.

EU could become sugar exporter if quotas abolished

The European Union could eventually become a net exporter of sugar if plans to

abolish production quotas in coming years are implemented.

EU, net sugar importer, is now in talks on proposed reforms to its protected sugar

regime, which restricts output to prop up prices.

Brazil's cane zones dry out, sugar harvest seen quickening

center-south cane belt will stay dry for the next few weeks, according to

forecaster Somar, speeding up the harvest of cane and output of sugar that was

hampered by an unusually wet start to April.

Brazil's sugar production will jump to a record level in the 2013/14 season justnow starting, with a surge in cane output from an expanded planted area,

favorable weather and efforts to renew old and less productive cane plants.

Outlook

Sugar may consolidate at lower levels in the coming week. Supplies will continue

to remain high as millers will release stocks to clear cane arrears. This will

offset summer season demand and recovery in the international markets.

Strategy

NCDEX Sugar May :Support-2850/2800, Resistance- 2930/3020


19/20

Kapas/Cotton



Cotton futures declined 5.8% last week as upward revision in production and

imports estimates coupled with reports that CCI will release stocks in the local

markets to augment supplies.

ICE Cotton declined 2.4% w-o-w as news that China's state reserve will sell some of

its massive reserve offset robust weekly export sales data.

CCI to Release 2 Lakh Bales in Domestic Market

CCI which procured nearly 20 lakh bales of cotton at MSP level, is expected to

release some quantity into the market soon. The CCI had also sought approval from

the Ministry of Textiles for export of 10 lakh bales.

Cotton Advisory Board sees lower kharif sowing

CAB in its latest meet has projected cotton crop at 34 mn bales for 2012-13 seasoncompared 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.

China to sell high-quality state cotton reserves

China will start to sell its high-quality reserves of fibre, which should spur purchases

by textile mills after Beijing's stockpiling tightened domestic supplies.

Starting on Friday, 19th April, govt will offer cotton imported in 2011 and purchased

from the 2012 harvest, and will allow textile mills to buy up to 8 months' worth ofconsumption. Beijing has said it would offer a total of 4.5 million tonnes for the

auctions to last until end of July.

This may dampen demand for foreign fibre from mills in the no. 1 textile market.

Outlook

Cotton prices may trade under downside pressure as near term supply side

fundamentals remain strong in both domestic as well as global markets.

Strategy

Sell MCX Cotton May between 18450-18500, SL -19250, Target - 17350 / 17200


20/20

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 7700Corporate 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

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Commodities Weekly Tracker, 22nd April 2013