Commodity Trends: Pepper uptrend continues, wheat also gains

Pepper continues to steal the show in agri-commodities with uptrend in prices continuing this week on limited supply from fresh crop. Turmeric futures regained at the end of the week as traders chose to cover short positions after the recent fall. Global wheat prices gained on USDA crop forecasts which estimates fall in output due to drought conditions.

Pepper
Pepper futures rose this week on the back of limited supply from the fresh crop and on depleted stocks with other major producing countries. Lower stocks with other major producing countries also supported buying. Vietnam is the largest pepper producing country in the world.

At Kochi on Friday pepper rose 207 rupees to 29,540 rupees per 100 kg. The most active June futures contract at National Commodity and Derivatives Exchange (NCDEX) closed at Rs.30391 per quintal, higher by 0.59 per cent. July contract opened this week at Rs.30300 per 100 Kg and closed at Rs.30690 per quintal, up by 0.36 per cent.

During April-February 2010-11, a total quantity of 16,600 MT of pepper valued Rs.334.62 crores was exported as against 18,425 MT valued Rs.293.00 crores of last year. The unit value of pepper has increased from Rs.159.02 per kg in 2009-10 to Rs.201.58 per kg during 2010-11.

As per the latest release from the Spices Board of India, Exports of spices and spices products from India have registered an increase of four per cent in volume and 19 per cent in terms of value during April-February 2010-11, as per the latest release from the Spices Board of India. In dollar terms, the rise in exports is 24 per cent.

According to IPC’s projection, pepper output in India is estimated near 48000 tons compared with 50,000 in the previous year.

Chana
Chana continued uptrend this week on firm demand from the millers and on reduced arrivals from the market.

In Delhi on Friday chana prices rose 39 rupees to 2,405 rupees per 100 kg. At NCDEX June delivery contract opened at Rs 2455 per 10 MT and closed at Rs 2512, higher by 2.32 % whereas Chana July contract opened at Rs.2525 and ended at Rs.2590, up by 2.57%.

According to the report released by the government of New South Wales (Australia) acreage under chickpeas during 2011-12 is forecasted to be lower.

India's weather office sees on schedule monsoon retreat India’s June-September monsoon rains are expected to withdraw on schedule, the chief of the weather office said , unlike last year when late end-season rains hit Kharif Pulses output and delayed Rabi sowing.

This year India is not expected to witness late withdrawal of rains unlike last year which was an abnormal one. There were heavy rains in Augusts September and withdrawal too was late, according to general of state-run India Meteorological Department.

A timely withdrawal of the monsoon, which delivers more than 70 percent of annual rainfall, will boost pulses output.

Soybean
Soybean gained this week tracking firm global cues and on falling arrivals in the physical market. Rising oil meal exports also supported the gain.

In global markets also soybean rose on bets that U.S. planting delays will persist because of more rain next week in the Midwest. Bad weather in the U.S is supporting the global oilseed market. Excessive wet weather and flooding in the eastern U.S. Midwest is delaying corn and soybean plantings.

On Friday, soybean futures for July delivery rose 0.75 cent to settle at $13.8025 a bushel on the CBOT. Prices were up 3.8 percent this week. The oilseed has climbed 46 percent in the past year on record Chinese purchases.

On Friday, in the Indore spot market, soybean eased by 6 rupees to 2,387 rupees per 100 kg. At Sri Ganganagar in Rajasthan, rapeseed rose by 28 rupees to 2,765 rupees per 100 kg.

In futures market, NCDEX June soybean prices gained from Rs.2390 to Rs 2401, an increase of 0.46 per cent while July Soybean prices settled down by 0.16 % from Rs 2434 to Rs.2430. June soy oil prices rose from Rs 633.90 to Rs 641.35 per 10 MT, higher by 1.17.

The soy meal exports during April 2011 have declined which might limit the gains. However, the USDA crop planting report has revealed the corn planting has slowed down across the central and western Corn Belt.

Turmeric
Turmeric futures regained at the end of the week as traders chose to cover short positions after the recent fall. In the mid week turmeric fell due to rising supplies from the new season crop and weak demand.

In Erode spot market also turmeric rose this weekend. Turmeric had decreased steeply by about Rs 1,700 a quintal in the last few days. The sale of both varieties of turmeric was also encouraging. There would be no major increase for the commodity in near future, but there would be a price fluctuation from Rs 200 to Rs 500 a quintal.

At the Erode Turmeric Merchants Association, the finger variety was sold at Rs 6,174-8,161 a quintal and the root variety, Rs 6,204-7,289 on Friday.

The most active June futures contract at National Commodity and Derivatives Exchange (NCDEX) closed at Rs.8212 per quintal, a decline of 2.53 per cent. July contract opened this week at Rs.8422 per 100 Kg and closed at Rs.8180 per quintal, down by 2.87 per cent.

Turmeric production for this year has been estimated higher because of increase in the cultivation area. Turmeric production in the year 2010-11 is estimated at 69 lakh bags (1 bag= 70 Kgs) compared to 48 lakh bags during the previous year.

According to India’s Spices Board, exports of Turmeric from India during April 2010- February 2011 stood at 42,500 tonnes as compared to 46,575 tonnes in 2009-10, a decline of 9%.

Wheat
Wheat futures fell this week in global and domestic markets. Wheat fell at the weekend in CBOT as drought cut output in Russia and eroded crops in the U.S. Great Plains.

On Friday wheat futures for July delivery fell 5.5 cents, or 0.7 percent, to $8.065 a bushel in Chicago. This week, prices were up 11 percent.

Drought conditions have expanded across Kansas and are threatening the state’s winter-wheat crop, the largest in the U.S., according to the National Drought Mitigation Center.

As of May 15, 55 percent of winter wheat in Kansas was rated poor or very poor by the U.S. Department of Agriculture. The National Weather Service estimates rainfall in the past 30 days was less than half of normal in much of those three states.

Kansas, Texas and Oklahoma produced 608.4 million bushels of wheat last year, or 28 percent of the total U.S. supply, according to the USDA. This year, the USDA expects production to drop 63 percent in Texas, 38 percent in Oklahoma and 27 percent in Kansas, compared with 2010.

In India, at NCDEX June delivery contract opened at Rs 1233.80 per 10 MT and closed at Rs 1226, fell by 0.63 % whereas Wheat July contract opened at Rs.1259 and ended at Rs.1246.80, down by 0.96%.

The International Grains Council lowered last month its outlook on global wheat production in the 2011-2012 season by 1 million tons to 672 million metric tons, matching global demand, because of "less than ideal conditions for some crops" in the U.S., the European Union and China. Further losses to the crop may cause production to lag behind demand for a second straight year, draining inventories.

Source: http://www.commodityonline.com/news/Commodity-Trends-Pepper-uptrend-continues-wheat-also-gains-39232-3-1.html