Commodity report 16 mar 2015 ways2capital

Page 1


✍ NCDEX DAILY LEVELS DALLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20 APR 15

613

603

593

587

583

577

573

563

553

SYBEANIDR

20 APR 15

3420

3399

3374

3363

3349

3338

3324

3299

3274

RMSEED

20 APR 15

3484

3450

3420

3400

3385

3365

3350

3320

3285

JEERAUNJHA

20 MAR 15

15975

15515

15060

14875

14605 14420 14155 13695

13245

CHANA

20 APR 15

3770

3735

3705

3690

3675

3660

3640

3610

3575

CASTORSEED

20 MAR 15

3880

3800

3720

3675

3640

3595

3560

3480

3400

✍ NCDEX WEEKLY LEVELS WEEKLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20 APR 15

667

641

615

598

589

575

563

537

511

SYBEANIDR

20 APR 15

3690

3585

3480

3416

3375

3311

3270

3165

3060

RMSEED

20 APR 15

3672

3580

3488

3435

3396

3343

3304

3212

3120

JEERAUNJHA

20 MAR 15

18325

17165

16000

15345

14845 14185 13,685 12,525

11365

CHANA

20 APR 15

3967

3873

3779

3728

3685

3634

3591

3497

3403

CASTORSEED

20 MAR15

4060

3926

3926

3712

3680

3578

3524

3390

3256


✍ MCX DAILY LEVELS DALLY

EXPIRY

ALUMINIUM

31 MAR 15

R4 117

R3 115

R2 113

R1 112

PP 111

S1 110

S2 108

S3 106

S4 104

COPPER

30 APR 15

386

382

378

376

373

372

369

365

361

CRUDE OIL

19 MAR15

4289

4158

4027

3946

3896

3815

3765

3634

3503

GOLD

03APR 15

26444

26246

26048

25980

25850

25782

25652

25454

25256

LEAD

31 MAR 15

121

118

115

113

112

110

109

106

103

NATURAL GAS 26 MAR 15

188

182

177

176

172

170

167

162

157

NICKEL

31 MAR 15

944

925

906

899

887

880

868

849

849

SILVER

05 MAY 15

36321

36055

35789

35676

35523

35,410

35257

34991

34725

ZINC

31 MAR15

130

129

128

127

126

126

125

124

122

R3

R2

✍ MCX WEEKLY LEVELS WEEKLY

EXPIRY

R4

R1

PP

S1

S2

S3

S4

ALUMINIUM

31 MAR 15

120

117

114

112

111

109

107

104

101

COPPER

30 APR 15

405

394

382

378

371

367

360

349

337

CRUDE OIL

19 MAR15

4022

3671

3320

3092

2969

2741

2618

2267

1916

GOLD

03APR 15

27568

27001

26434

26173

25867

25606

25300

24733

24166

LEAD

31 MAR 15

125

121

117

114

112

109

108

104

100

NATURAL GAS 26 MAR 15

208

197

185

179

174

168

162

151

140

NICKEL

31 MAR 15

1,061

1,005

948

920

892

864

835

779

722

SILVER ALUMINIUM

05 MAY 15 31 MAR 15

39449 120

38148 117

36847 114

36205 112

35546 111

34904 109

34245 107

32944 104

31643 101


MCX - WEEKLY NEWS LETTERS � INTERNATIONAL NEWS Chinese economy faces big downward pressures: China registered 7.4 percent growth last year, slowest in 24 years. A recent IMF forecast said China's growth rate would further decline to 6.8 this year and 6.3 next year. Admitting that China's economy is facing considerable downward pressures due to the slowdown, the new GDP target of around 7 percent set for this year is not easy to meet but the government has host of policy to halt the slide. "This year we set the anticipated GDP target approximately 7 percent. It is true that we have adjusted downward our GDP target but it will by no means easy for us to meet this target," annual press conference at the end of the 10-day meeting of the legislature, the National People's Congress (NPC). China registered 7.4 percent growth last year, slowest in 24 years. A recent IMF forecast said China's growth rate would further decline to 6.8 this year and 6.3 next year. Li said because China's economic aggregate is expanding it size now is valued at about USD 10 trillion which is equivalent to the total economy of a medium sized country. Russian economy is ready to grow: While the political impact of the opposition leader Boris Nemtsov's killing has been limited in Russia, it has fueled demands for new sanctions against Moscow in the West. Meanwhile, Russian equity valuations suggest potential for a strong performance over the coming months. After a year of sanctions and a contraction, the Russian economy is ready for the upside. What it needs are economic reforms and international integration - not further sanctions and geopolitical isolation. While the political impact of the opposition leader Boris Nemtsov's killing has been limited in Russia, it has fueled demands for new sanctions against Moscow in the West. Meanwhile, Russian equity valuations suggest potential for a strong performance over the coming months. The ailing post-sanctions economy In pre-sanctions Russia, growth was expected to remain weak in 2014-2015 due to stagnant oil demand, while institutional weaknesses reflected a poor investment climate. In early 2014, markets projected growth of 1.7 percent for 2014 and 2.3 percent in 2015, with a deceleration of inflation to about 5 percent and a policy rate of 5 percent. With sanctions in place, the Russian economy wound up contracting 3.5 percent in 2014. Even in a benign scenario, Moscow can only expect flat growth in 2015. With subdued oil prices and weak ruble, only exports are driving growth. Euro sinks to 12-year lows as yield gap grows: In a dollar rally that began last July the single currency has lost around a quarter of its value, and there is little sign of that bottoming out. Deutsche Bank on Tuesday forecast a fall to 85 US cents by the end of 2017. The euro dived to its lowest since early 2003 against the dollar on Wednesday, dragging other European currencies with it on the back of the huge differences developing in market interest rates between Europe and the United States. In a dollar rally that began last July the single currency has lost around a quarter of its value, and there is little sign of that bottoming out. Deutsche Bank on Tuesday forecast a fall to 85 US cents by the end of 2017. That comes largely courtesy of the collapse in European bond yields, which are set to stay low for the foreseeable future under the programme of money-printing launched by the European Central Bank on Monday. Yields on German 30-year government bonds are now lower than those on US two-year paper. The picture for European stock markets, given the projected 1 trillion of new euros set to flow


into the financial sector, is less grim, and the main indexes were all higher in early trade.

� BULLION Gold imports rise to $1.98 bn in February: As per data released by the Commerce Ministry this month, the gold shipments in February jumped 48.78 percent on a year-on-year basis. India is the largest importer of gold, which is mainly utilised to meet the demand of the jewellery industry. old imports in February rose to USD 1.98 billion (Rs 12,293 crore), the second successive monthly rise. Gold imports had inched up in January 2015 to USD 1.55 billion. Despite easing in gold import norms, the shipments had dropped sharply in December 2014. The December import figure stood at USD 1.34 billion, about one-fourth of the quantity in November. As per data released by the Commerce Ministry this month, the gold shipments in February jumped 48.78 percent on a year-on-year basis. India is the largest importer of gold, which is mainly utilised to meet the demand of the jewellery industry. In November 2014, the RBI had eased restrictions on gold imports by scrapping the controversial 80:20 scheme. Under the 80:20 norm, put in place in August 2013 to curb high gold inflows that was widening the current account deficit, at least 20 percent of the imported gold had to be mandatorily exported before bringing in new lots. Government has been repeatedly asking people to desist from buying gold and instead invest in other saving instruments. Gold demand in Asia picks up due to lower prices :Demand for gold picked up across Asia this week as bullion prices dropped to their lowest level in three months after the longest losing streak in more than 40 years, but caution still prevailed, traders said. Gold, trading at about USD 1,158 an ounce on Friday, touched USD 1,147.10 on Wednesday, the lowest since Dec. 1. The metal fell for nine straight sessions to Thursday, the longest losing streak since 1973. The lower prices attracted bargain-hunters across Asia, the top consuming region, although wariness over the price outlook kept a lid on purchases. In top consumer India, premiums remained largely unchanged from last week's levels at about USD 1.50 to USD 2.50 an ounce. "Demand has increased a little bit because of the drop in prices but there is no big rush," "This is the last month of the financial year so there is some liquidity crunch in the market. That is quite seasonal, but that's also curbing some purchases," he said. Indian demand could pick up pace next month with the onset of the wedding season. The festival of Akshaya Tritaya, considered an auspicious time to buy gold, could also boost demand and imports in April, he said. In second-biggest consumer China, premiums on the Shanghai Gold Exchange, the platform over which all Chinese physical trades are conducted, was steady on last week's levels at about USD 4-USD 5, though some noted that volumes had slowed recently.

� BASE METAL LME Copper prices to trade sideways: LME Copper prices is expect to trade sideways as pressure on policymakers to introduce broad-based stimulus measures will be supportive. Also, estimates of favorable inflation and consumer sentiments data from the US will act as a positive


factor. Base metals on the LME traded mostly higher on Thursday as dollar index weakened by 0.4 providing respite to the falling prices. LME copper, Nickel, rose the most in the base metals pack gaining 2.1 and 1.4 percent respectively while Lead, Zinc gained by 0.7 and 0.3 percent respectively In the Indian markets, base metals traded mostly positive in line with international trends. Copper LME Copper prices jumped by 2.1 percent as credit growth expanded more than forecast in China, the world’s largest user of industrial metal. Also, triggered short-covering coupled with a dip in the US dollar offered support. MCX copper prices surged by 1.7 percent and closed at Rs.371.2/kg on Thursday. Outlook We expect LME Copper prices to trade sideways as pressure on policymakers to introduce broad-based stimulus measures will be supportive. Also, estimates of favorable inflation and consumer sentiments data from the US will act as a positive factor. On the MCX, copper prices are expected to trade sideways taking cues from international markets.

✍ ENERGY Oil prices drop on strong dollar, US crude hits 6 year low: US crude fell to USD 43.57, the lowest since March 2009, while Brent slipped to USD 53.34 in early trading on Monday after the dollar index closed above 100 on Friday for the first time since April 2003 to hit fresh 12-year highs. Oil prices fell sharply in early Asian trade on Monday, with US crude dropping more than 2 percent to a six-year low after the dollar hit fresh highs and concerns grew that the United States might run out of oil storage. Both US crude and Brent have dropped steeply this month on a stronger dollar and worries over an oil supply glut. US crude fell to USD 43.57, the lowest since March 2009, while Brent slipped to USD 53.34 in early trading on Monday after the dollar index closed above 100 on Friday for the first time since April 2003 to hit fresh 12-year highs. By 2330 GMT, U.S. crude was down 93 cents, or 2.1 per cent, at USD 43.91 a barrel, and Brent was down 97 cents at USD 53.70 a barrel. The Fed's policy-setting committee meets this week with the expectation that it could tighten monetary policy as soon as June. NYMEX crude prices down sharply in Asia as supply worries weigh: Crude oil prices sharply on Monday in Asia as supply worries weighed on sentiment. On the New York Mercantile Exchange, crude oil for delivery in April plunged 2.19% to $46.03 a barrel. Last week, crude oil futures fell sharply on Friday to hit the lowest level in six weeks, following the release of a mostly bearish report from the International Energy Agency on global oil supply and demand. In its closely-watched monthly oil market report released Friday, the IEA warned that an oil-price recovery remained fragile amid a production rebound in the U.S.

NCDEX - WEEKLY NEWS LETTERS ✍ Use e-auction to procure agri commodities: Govt to states The central government has written to all state governments to opt, where possible, for e-auctions to procure agricultural commodities. This is part of a plan to get going in a national


common market for agri products, linking all the wholesale markets run by Agricultural Produce Marketing Committees. According to the official Economic Survey for 2014-15, there are 2,477 principal regulated markets based on geography and 4,843 sub-market yards regulated by the APMCs. The Centre aims to link all these, to create one market. The first step has been to get each state to change its APMC law, to allow private market yards or markets. Some states have denotified fruit and vegetables from their Act. This is not considered enough and the recommendation on e-auction is the next step. Half a dozen states have begun procuring sugar for public distribution by using the e-auction facilities provided by NCDEX E-Markets (NEML), a subsidiary of the National Commodities and Derivatives Exchange (NCDEX). The Centre has lauded NCDEX’s mandi modernisation programme (MMP), under which all APMCs of Karnataka have already been linked electronically and farmers get one state price for commodities traded on this common platform. The Survey said in Karnataka, 51 of the 155 main market yards and 354 sub-yards have been integrated into a single licensing system. Rashtriya e-market Services, a joint venture created by the state government and NCDEX Spot Exchange, offers automated auction and post auction facilities (weighting, invoicing, market fee collection, accounting), assaying facilities in the markets, facilitation of warehouse-based sale of produce, commodity funding and price dissemination NCDEX is also implementing a Unified Market Platform, whereby all mandis in the state are being unified for single trading. Apart from Karnataka, it has started unifying mandis in Telangana and Andhra Pradesh. Among other states in discussion with NEML are Punjab, Haryana and UP. NCDEX has also launched forward trading in several agricultural commodities, such as castor seed, cumin, maize and sugar. The exchange has started a membership drive specially for farmer producer organisations, through which farmers can sell their produce directly on the NCDEX forwards segment. There are lakhs of physical traders who buy commodities from APMC markets nationwide. The forwards segment provides them an alternative platform to sell these.�

� Chana falls Concerns over lesser output due to lower sowing acreage restricted the losses Chana prices were down by 0.22% to Rs 3,645 per quintal in futures traded on wednesday, largely in tandem with subdued demand at sot markets.


However, concerns over lesser output due to lower sowing acreage restricted the losses. At the National Commodity and Derivative Exchange, chana for delivery in April eased by Rs 8, or 0.22% to Rs 3,645 per quintal with an open interest of 1,75,150 lots. Similarly, the commodity for delivery in May contracts traded lower by the same margin to Rs 3,654 per quintal in 1,04,730 lots. It can be said offloading of positions by speculators, amid subdued demand in spot market against adequate stocks position, mainly influenced chana prices at futures tradew

� Refined soya oil up, Oil for delivery in May contract edged up by 0.10% Refined soya oil prices rose by 0.35% to Rs 562.25 per 10 kg in futures traded on monday as speculators created fresh position, driven by pick-up in demand in the spot market. At the National Commodity and Derivatives Exchange, refined soya oil for delivery in June rose by Rs 1.95, or 0.35%, to Rs 562.25 per 10 kg with an open interest of 1,19,740 lots. Likewise, the oil for delivery in May contract edged up by 60 paise, or 0.10% to Rs 581.60 per 10 kg in 86,500 lots. Besides pick-up in demand in the spot market, tight supplies from producing belts mainly helped refined soya oil prices to trade higher at futures trade.

� Castorseed down 0.8% on subdued demand Castorseed prices fell by Rs 35 to Rs 3,902 per quintal in futures traded on Wednesday after speculators positions triggered by higher output estimates and weak domestic as well as export demand. At the National Commodity and Derivative Exchange, castorseed for delivery in February dropped by Rs 35, or 0.89%, to Rs 3,902 per quintal with an open interest in 50,810 lots. Also, March contracts moved down by Rs 22, or 0.55%, to Rs 3,951 per quintal, having an open interest of 83,660 lots. We can say that, the fall in castroseed prices at futures trade to offloading of positions by speculators triggered by higher production estimates and weak domestic and export demand at spot markets.


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