Commodity report by ways2capital 12 jan 2015

Page 1


✍ NCDEX DAILY LEVELS DALLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20-02-2014

669

667

665

663

661

658

656

654

652

SYBEANIDR

20-02-2014

3550

3530

3510

3495

3480

3460

3440

3420

3400

RMSEED

20-04-2014

3630

3610

3580

3560

3540

3520

3500

3480

3460

JEERAUNJHA

20-02-2014

15800

15700 15600

15500

15400 15300 15200 15100 15000

CHANA

20-02-2014

3640

3620

3600

3580

3560

3540

3520

3500

3480

CASTORSEED

20-02-2014

4820

4800

4780

4760

4740

4720

4700

4680

4640

✍ NCDEX WEEKLY LEVELS WEEKLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20-02-2014

677

672

668

664

660

656

652

648

644

SYBEANIDR

20-02-2014

3610

3570

3540

3510

3480

3440

3400

3360

3320

RMSEED

20-04-2014

3670

3640

3610

3580

3550

3520

3480

3440

3400

JEERAUNJHA

20-02-2014

16400

16200 16000

15800

15600 15400 15200 15000 14800

CHANA

20-02-2014

3710

3670

3630

3590

3560

3530

3500

3460

3420

CASTORSEED

20-02-2014

4870

4840

4810

4780

4740

4700

4660

4620

4580


✍ MCX DAILY LEVELS DALLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

30-01-2015 119

118

117

116

115

114

113

112

111

COPPER

27-02-2015 393

391

389

387

385

383

381

379

377

CRUDE OIL

16-01-2015 3140

3120

3100

3080

3060

3040

3020

3000

2980

GOLD

05-02-2015 27400

27300

27200

27100

27000

26800

26700

26600

26500

LEAD

30-01-2015 120

119

118

117

116

115

114

113

112

NATURAL GAS 27-01-2015 193

192

191

190

189

188

186

185

184

NICKEL

30-01-2015 990

970

950

930

910

890

870

850

830

SILVER

05-03-2015 37800

37600

37400

37200

37000

36800

36600

36400

36200

ZINC

30-01-2015 138

137

136

135

134

133

132

131

130

✍ MCX WEEKLY LEVELS WEEKLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

30-01-2015 124

122

120

118

116

114

112

110

108

COPPER

27-02-2015 401

397

394

391

387

385

382

379

375

CRUDE OIL

16-01-2015 3210

3170

3130

3090

3050

3010

2970

2930

2890

GOLD

05-02-2015 27900

27700

27500

27300

27100

26900

26700

26500 26300

LEAD

30-01-2015 123

121

119

117

115

113

111

109

107

NATURAL GAS

27-01-2015 199

196

193

190

187

184

181

179

177

NICKEL

30-01-2015 1060

1030

990

960

930

900

870

840

810

SILVER

05-03-2015 38400

38000

37600

37400

37000

36600

36200

35800 35400

ZINC

30-01-2015 142

140

138

136

134

132

130

128

126


� MCX - WEEKLY NEWS LETTERS INTERNATIONAL NEWS The US Dollar Index (DX) strengthened by 0.4 percent yesterday hit fresh nine-year highs against the other major currencies as growing expectations for an upcoming U.S. rate hike continued to boost the greenback. Further, companies added more workers than forecast in December, indicating the U.S. job market was sustaining strength in 2014 acted as a positive factor. The currency touched an intra- day high of 92.51 and closed at 92.12 on Wednesday. ADP Non-Farm Employment Change jumped by 241k in December as compared to a gain of 227k in November. Trade Balance declined by $39 billion in November as against a fall of $42.2 billion in October.

1.

Euro zone economic survey showed that consumers' inflation expectations 12 months ahead continued to fall, reaching 2.7 against 5.7 in November, well below the average since 1990 of 20.2.

2.

Initial claims for state unemployment benefits slipped by 4,000 to a seasonally adjusted 294,000 for the week ended Jan. 3, the US Labor Department said on Thursday.

3.

The U.S. Energy Information Administration said utilities pulled 131 billion cubic feet of gas from storage last week.

The Indian Rupee bounced back after two days of fall and appreciated by 0.5 percent on fresh dollar selling by exporters and some banks. Further, sluggish Indian stock markets, fresh capital outflows amid firm dollar overseas could not restrict sharp upside. However, hopes of interest rate hike by the Fed in its meeting exerted pressure on the currency. The currency touched an intra day high of 63.16 and closed at 63.27 on Wednesday. PRECIOUS METAL Silver was down 1 percent at $16.35 an ounce. The number of Americans filing new claims for unemployment benefits fell last week and job cuts declined sharply in December, suggesting the labor market is tightening. Thursday's reports support views of faster growth this year, driven by consumer spending, despite a faltering global economy. Gold fell for the second straight day on Thursday, in a choppy session weighed down by a stronger dollar and rising stock markets after being buoyed by expectations the Federal Reserve will be patient in raising interest rates. Minutes from the Federal Reserve's latest policy meeting released on Wednesday reassured markets that the central bank was in no hurry to raise interest rates, lifting European shares. Gold has benefited from years of increased central bank liquidity and a low interest rates environment, while higher U.S. interest rates would encourage investors


to put money into riskier assets such as stocks and bonds. Meanwhile, increasing speculation that Greece might exit the euro zone if a left-wing party that wants to cancel austerity measures wins the Jan. 25 elections could lift gold's demand from investors looking for protection. Among currencies, the dollar hit a 9-year high against the euro, as investors ramped up bets the European Central Bank was getting closer to loosening monetary policy to ward off deflation. Analysts are awaiting the release of U.S. non-farm payrolls data for December on Friday, a key barometer of the health of the U.S. economy. An upbeat report is likely to support the view that the Fed will raise rates sooner rather than later.

BASE METAL Aluminum rebounded from lows on Thursday as some investors bought back short positions to lock in profits, but more losses were expected for copper and zinc ahead of the new year holiday in top metals consumer China. Copper, burdened by worries about oversupply, failed to sustain a bounce from 4-1/2 year lows the previous day, ending in the red again. At its lows on Wednesday, aluminum had shed 15 percent since late November as investors worried about smelters restarting capacity they had shut down. Also weighing on copper was more evidence of higher supplies as LME inventories rose to 179,225 tonnes, bringing the increase since last August to 27 percent Copper prices traded at a four and half year low on Wednesday, weighed by demand concerns and steep falls in oil that sapped investors' appetite for most commodities. Worries about the possibility that Greece will quit the euro zone have also dented appetite for risk. Also China, which accounts for more than 40 percent of global metal demand, is facing slower economic growth and a cooling property market, which is a major copper-consuming industry. China's annual economic growth likely slowed to 7.2 percent in the fourth quarter, the weakest since the depths of the global crisis, which would keep pressure on policymakers to head off a sharper slowdown

ENERGY U.S. natural gas futures gained 2 percent on Thursday after the government reported a biggerthan-expected storage draw and on colder-than-normal forecasts for the next two weeks. The U.S. Energy Information Administration said utilities pulled 131 billion cubic feet of gas from storage last week.As on Wednesday, the latest weather models for the lower 48 U.S. states on Thursday called for colder-than-normal temperatures over the next two weeks, with an expected 502 heating degree days.


Global oil prices were little changed for a second straight day on Thursday after better-thanexpected U.S. jobs data helped the market hold ground after a 10 percent loss earlier in the week. But support for oil was likely to be short-lived as market bears continue hunting for a bottom to the second-biggest price rout in crude's history, traders said. Some traders think oil prices could be at a crossroads after losing over half their value from June highs, and that could explain benchmark Brent's stalling at above $50 since Wednesday. Others believe the market has just been handed a reprieve before being hammered lower. Data on Thursday showed jobless claims in the United States fell last week, while a separate report said U.S. employers announced a total of 483,171 job cuts in 2014. That was 5 percent fewer than in 2013 and the smallest number since 1997. Expectations the European Central Bank could resort to stimulus measures after a rash of weak economic data and record crude imports by China in December, possibly due to attractive pricing, also helped sentiment, traders said. But the world's largest oil traders have also started hiring supertankers to store crude at sea, marking a milestone in the build-up of the global glut of supplies, freight brokers and shipping sources said.

LME INVENTORIES LME Inventories

Copper

Lead

Zinc

Aluminium

Nickel

Current Stock

179225

221975

676375

4175750

415842

Change

550

0

-4475

-8650

30

% Change

0.31%

0.00%

-0.66%

-0.21%

0.01%

� NCDEX - WEEKLY NEWS LETTERS RM SEED RMSeed rates stabilized at these levels even as traders anticipate good demand for Mustard Oil to prevent any strong fall in this commodity rates. The recent rains in growing states of Rajasthan, Gujarat and UP had kept pressure on the market sentiments but as demand rises, overall sentiments look set to move up. Reports of crop damage from parts of Rajasthan from recent rains also kept prices firm.


Demand rose further for Mustard Oil amid falling stocks ahead of the Festival season. Cool weather in growing states keep production prospects good though reports of damage to crop in some areas in Rajasthan from the recent rains supported the market sentiments. Haryana area coverage in Rabi 2014-15 till 24 December was reportedly 5.25 lakh ha while it was 5.47 lakh ha in 2013-14 during this time. The reason is again the high temperature during Oct. MP area coverage in Rabi 2014-15 till 24 December was 6.46 lakh ha while it was 7.87 in 2013-14. Due to good rains in Oct and fields being unused, early sowing was possible there. UP area coverage in Rabi 2014-15 till 24 December was 11.42 lakh ha while it was 10.37 lakh ha in 2013-14 during this period. As fields this year were unused in kharif season, so farmers had sown Mustard early in UP. Mustard area coverage in All over India is 63.79 lakh Ha during Rabi 2014-15 and 67.00 lakh ha in 2013-14, area coverage during Rabi 2014-15 is lower. As per latest reports from Oil World, the output of mustard in Europe is expected to decline near 15% to 205 lakh tons, the lowest level in past 30 years, while it was 240 lakh tons last year. There is outbreak of insects on the mustard cops in Europe, as per the Oil World re-port, which may reduce the yield JEERA Lack of strong demand kept trend slight weak for Jeera even as traders anticipate exports to pick up in coming days. Low production reports amidst pickup in export demand are likely to lend strong support to the prices in the medium to long term though short term trend remains very volatile. The recent rains in the growing states of Gujarat and Rajasthan had created possibilities of improved crop productivity. However with International markets opening after the recent holidays, export demand has started rising. As per latest Govt reports, in Guja-rat, normal area for Jeera crop is approximately 388,000 hectares. Till 5.1.2015, only 2.64 lakh ha have sown as compared to 4.54 lakh ha last year. The sowing area during the current year likely to go down in Gujarat and Rajasthan growing regions due to lower price as compared to Coriander. Area may shift to Coriander and Fenugreek seed. Cumin output is expected to fall steeply in Gujarat this year. Output was 3.46 lakh tons in the state last year but output may fall this year as acreage is slashed by 42%. However, yield is expected to improve after the rainfall that the state received last week. Still, there is less probability of the output to cross 2 lakh tons. Latest report from Spice Board of India indicates pickup in exports during April-Sept 2014 period at 87500 tonnes (up from 70243 in April-Sept 2013) – a rise of 25% in Quantity and 2% in value. The targeted Export for 2014-15 period is 1,00,000 tonnes. With Indian produce being of superi-or quality, they fetch a premium w.r.t. International market


producing countries. Adverse reports from International producers would be beneficial for the Indian markets in the long term. The exports have already shot up 40% during the 1st half of the quarter. It is expected to remain high in coming months too – which could create a Bullish sentiment in the long term for the commodity. Finally a fall in area as reported amidst adverse weather conditions in growing areas could help keep market sentiments firm in the medium term.

CHANA Chana traded with high volatility as prices bounced back from the lower levels as demand started rising in domestic market. With skies clearing up in North-West India, trend likely to remain firm for the counter in coming days. Lower sowing reports amid fall in stocks and improved domestic demand are likely to support the prices. Extending Duty-free import for Pulses till March 31 did create a temporary selling pressure. Fall in Rabi sowing area for Rabi Pulses and lower International production prospects could support prices in medium to long term however. As per USDA, expected pulses production in USA is up by 8% to 2,232,630 metric tonne during 2014 from last year. Reports from Canada indicate chickpea production there expected to fall to 0.14 million MT in 2014-15—down from 0.18 million MT in 2013-14due to lower yield. Reports from Australia indicate a 22.5% fall in Pulses production and more than 30% fall in Chick Peas production in 2014-15 vs that in 2013-14. Latest report from AP Agri Dept indicate Rabi Pulses sowing down 6% from 6.43 lakh ha as on 24.12.2013 to 6.02 lakh ha as on 24.12.2014. Rajasthan Agri Dept for Rabi Pulses indicates sowing indicates area at 15.36 lakh ha as on 19.12.2014, vs 15.28 lakh ha as on 19.12.2013. MP Agri Dept indicates Rabi Pulses sowing at 35.81 lakh ha as on 19.12.2014 vs 42.44 lakh ha previous year—down by 15.6%. As per Ministry of Agriculture, rabi pulses 2014-15 coverage till Dec 26 is down to 124.16 lakh Ha as com-pared with last year’s area coverage of 134.72 lakh hectare during the corresponding week. As on 2.1.2015, area planted under chana is down to 79.65 Lakh ha against 95.03 lakh ha in same period last year. All India Masoor area is down by 1.5%, Rabi Urad up by 7% and Moong down by 0.5% -as per latest Govt figures. As per 1st Advanced crop estimates for 2014-15 by Govt of India, India is likely to produce Kharif Foodgrains of 120.27 million tonnes, which is down by 8.97 million tonnes from the record 129.24 million tonnes achieved in Kharif 2013-14.


REFI. SOYA Bullish trend persisted for Ref Soy Oil as good demand in domestic markets amid firmness in Interna-tional markets kept supporting the prices. Sources indicate some more recovery possible in the near term as demand picks up further. The recent hike in Import Duty on Crude Edible Oil and refined edible oil would have a medium term Bullish impact on prices—as per sources. Import Duty on Crude Edible Oil hiked from 2.5% to 7.5% and on Refined Edible Oil hiked to 15% from 10%. Fall in International markets had so far kept pressure on the market sentiments while domestic markets traded firm. Rates however continue to find strong psychological Resistance at the 600 level. Total U.S. oilseed production for 2014/15 is projected at 117.0 million tons, down slightly due to a small reduction in cottonseed. Soybean exports are increased 40 million bushels to 1,760 million reflecting the record export pace in recent weeks and prospects for additional sales and shipments ahead of the South American harvest. With crush unchanged, soybean ending stocks for 2014/15 are projected at 410 million bushels, down 40 million from last month but still the highest since 2006/07. India imported 11.62 million tonnes of edible oil during Sep-Oct 2013/14 compared to 10.68 million tonnes during the same period previous season, stated the Solvent Extracors' Association (SEA). India’s 2013/14 soyoil imports stood at 1.95 Mn T against 1.09 Mn T in 2012/13 season. Palm oil purchases were slightly lower at 7.29 Mn T against 8.29 Mn T last season. Sunflower oil imports were recorded at 1.51 Mn T against 0.97 Mn T in 2012/13 estimate for 9.4 crore tons.


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