Weekly Spices Wrap Up: Jeera Continues To Outperform In Spices Complex

Jeera futures scaled new contract highs this week on the back of waning supplies in the major producing states against strong stockiest demand at lower levels. Jeera arrivals in the Unjha market yard were in the range of 7,000-10,000 bags and price quoted at 14,800-15,800 per 100 kg.  Arrivals were down against the average of 15,000-17,000 bags during the last year. Crop delay of more than 15 days is seen Rajasthan and this may support prices further. Jeera March delivery gained around 8% over the last week toRs. 17370 per 100 kg at close of the week. As per market sources, traders are currently projecting the total jeera production of 2010-11 at around 21 lakh bags against 29 lakh bags reported last year. The total production of Gujarat is likely at 16 lakh bags against 21 lakh bags and Rajasthan is likely to report around 5 lakh bags against 7 lakh bags reported last year. Moreover, weak opening stocks of around 4-5 lakh bags against 8-9 lakh bags of previous year might also reduce the overall supply of jeera in the next marketing season (April to November).

Yellow spice ended the week marginally higher on commodity exchanges. Some profit taking on previous gains and slightly improvement in  arrivals in Erode mandi as farmers received good prices lead some selling in futures. April delivery closed the week 2.20% at Rs. 10086 per 100 kg. Prices gained further in major mandies like Erode, Salem, Nizamabd, Sangli etc. Arrivals in the Erode gained to 13,000-12,000 bags with price quoted at Rs. 12,500-11,500 per 100 kg. Flow of arrivals in the Nizamabad mandi were in the range of 3,000-4,000 and the Finger variety quoted at Rs. 12,000-12,500 per 100 kg.

Chilli ended the week marginally lower on some profit taking coupled with slight increase in the arrivals in the benchmark Guntur mandi during the week. The arrivals were in the range of 30,000-70,000 bags against 30,000- 60,000 bags last week. Chilli March ended the session down 0.12% at Rs. 9920 per 100 kg.

Pepper futures fell further during the week on weak export and domestic demand. March delivery closed the week down 3.4%at Rs. 22735 per 100 kg. Arrivals in the range of 500-200 quintals and price tumbled by Rs. 400 over the last week to Rs. 22,800 per 100 kg.

Cardamom extended the loss on weak demand amid strong arrivals, improved weather in the growing belts. MCX March contract ended the week down 3% over the last week toRs. 1,243.90 a kg and the average prices dropped to Rs. 850-900 levels in the local markets.  Futures rebounded marginally on Saturday on some short covering with contract ending 4% higher over Friday.

Outlook For Next Week:

Despite the weak fundamentals, Cardamom futures may extend the Saturday's recovery on some technical cues as short covering likely to emerge in next few sessions. The 14-day RSI rebounded from the oversold zone with ending at 28.10 levels. MCX March Cardamom ended four percent higher on Saturday after correcting around 38% from the December high. MCX March cardamom contract have next resistance at Rs. 1,180-200 and supports at Rs. 1,060 in next week.

NCDEX Jeera futures likely to extend the gains during the next week as the reports of delay in harvesting are likely to encourage more speculative buying. March Jeera may touch the high of Rs. 18,000 and support at Rs. 16,800 per 100 kg.

Major Events In Spices During The Week

The spices Board of India released the much awaited spices export data for the period April to January 2011 with comparison over the same period last year.  India exported a total of 433,455 tonnes of spices and spice products valued Rs. 5485.40 crores (US$1203.30 Million) during April-January 2010-11as against 413,895 tonnes valued Rs.4646.50 crores (US$ 974.57 Million) in April-January 2009-10 registering an increase of 5% in volume and 18% in rupee terms of value. In dollar terms the increase is 23%.

Compared to the spices export target of 465,000 tonnes valued Rs. 5100.00 crores (US$1125 million) fixed for the financial year 2010-11, the achievement of 433,455 tonnes valued Rs. 5485.40 crores (US$ 1203.30 million) during April-January 2010-11 is 93% in terms of quantity and 108 %   in rupee value and 107% in dollar terms of value.

Table Showing Major spices wise Exports

		APRIL - JANUARY 2010-11 (*)		APRIL - JANUARY 2009-10		Changes 2010 - 11
ITEM		Qty in Tonnes		Vale In Rs.Crores		Rate		Qty in Tonnes		Vale InRs.Crores		Rate		Qty in Tonnes		Value
PEPPER		15,700		307.47		195.84		16,925		269		159.15		-7%		14%
CARDAMOM(S)		780		91.19		1169.07		1,540		121		784.8		-49%		-25%
CARDAMOM(L)		600		33.50		558.4		720		12		160.52		-17%		190%
CHILLI		200,000		1,255.52		62.78		163,750		1,057		64.53		22%		19%
TURMERIC		38,000		551.35		145.09		43,825		316		72.02		-13%		75%
CORIANDER		35,500		139.58		39.32		36,150		180		49.89		-2%		-23%
CUMIN		26,000		311.98		119.99		40,800		452		110.9		-36%		-31%

(Source: http://www.indiainfoline.com/Markets/News/Weekly-Spices-Wrap-Up-Jeera-Continues-To-Outperform-In-Spices-Complex/3581845113)