Commodity report ways2capial 04 may 2015

Page 1


✍ NCDEX DAILY LEVELS DAILY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

19 JUN 2015

595

591

587

584

583

580

579

575

571

SYBEANIDR

19 JUN 2015

4299

4215

4131

4099

4047

4015

3963

3879

3795

RMSEED

20 MAY 2015

3928

3889

3850

3834

3811

3795

3770

3733

3694

20 MAY 2015 20300 19410

18520

18080

17630 17190 16740 15850

14960

CHANA

20 MAY 2015

4382

4325

4268

4236

4211

4179

4154

4097

4040

CASTORSEED

20 MAY 2015

3845

3795

3745

3720

3695

3670

3645

3595

3545

JEERAUNJHA

✍ NCDEX WEEKLY LEVELS WEEKLY

EXPIRY DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

19 JUN 2015

634

618

602

592

586

576

570

554

538

SYBEANIDR

19 JUN 2015

4604

4422

4240

4157

4058

3975

3876

3694

3512

RMSEED

20 MAY 2015

4149

4042

3935

3876

3828

3769

3721

3614

3507

20 MAY 2015 21380 20120

18860

18020

17600 16760 16340 15080

13820

CHANA

20 MAY 2015

4755

4568

4381

4291

4194

4084

4007

3820

3633

CASTORSEED

20 MAY 2015

4238

4070

3902

3798

3734

3630

3566

3398

3230

JEERAUNJHA


✍ MCX DAILY LEVELS DAILY

EXPIRY DATE R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

29-MAY-15

125

124

122

121

120

119

118

117

116

COPPER

30-JUN-15

450

435

420

414

404

399

389

374

359

CRUDE OIL

18-MAY-15

3974 3907

3840

3816

3773

3749

3706

3639

3571

GOLD

5-JUN-15

2875 28129 3

27502

27105

26880

26485

26255

25630

25000

LEAD

29-MAY-15

140

138

136

134

133

132

130

128

126

NATURAL GAS

26-MAY-15

218

202

187

181

172

166

157

141

126

NICKEL

29-MAY-15

940

919

895

885

870

863

847

823

795

SILVER

3-JUL-15

38399

37398

36729

35728

35059

33389

31719

4173 40069 9


✍ MCX WEEKLY LEVELS WEEKLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

29-MAY-15

137

131

125

123

119

117

113

108

102

COPPER

30-JUN-15

465

444

423

415

402

394

381

360

339

CRUDE OIL

18-MAY-15

4392

4168

3944

3863

3720

3644

3496

3272

3048

GOLD

5-JUN-15

28735 28770

27485

27070

26860

26440

26240

25615

24990

LEAD

29-MAY-15

146

142

138

136

133

132

129

125

121

NATURAL GAS

26-MAY-15

238

215

192

183

169

160

146

123

100

NICKEL

29-MAY-15

1000

955

910

895

865

850

820

775

730

SILVER

3-JUL-15

35808

37453

35479

34960

33786

31412

3100

ALUMINIUM

29-MAY-15

137

131

125

123

119

117

113

108

102

COPPER

30-JUN-15

465

444

423

415

402

394

381

360

339

42056 40282


✍ MCX - WEEKLY NEWS LETTERS ✍ INTERNATIONAL NEWS ✍ China export fell Plunging iron ore prices are providing a lifeline for some of China's biggest steel mills, but raising the prospect of a rising tide of exports and increased friction with the European Union and countries such as India. Even as China's domestic steel demand shrinks and the industry battles chronic overcapacity, lower iron ore prices have helped many large mills post better earnings in 2014 than a year earlier, supported by record exports. China boosted exports of the alloy by some 50 percent last year to a record 94 million tonnes, and western industry bodies see little sign of a major rationalisation of the industry. Seaborne iron ore prices tumbled 50 percent over the course of the year amid a push by mega iron ore miners to ramp up supply and win market share. BIG MILLS BENEFIT Big Chinese mills are able to ship in cheaper seaborne ore direct to their coastal steelmaking operations, selling to customers nearby or shipping steel overseas. The European Union is imposing anti-dumping duties on imports of cold-rolled flat stainless steel from China and Taiwan. India's trade ministry has also recommended anti-dumping duties against China, Malaysia and South Korea for some industrial grade steel imports. EXPORT CONCERN China aims to cut the number of steel mills by more than 40 percent to below 300 by 2017, and plans to have three to five giant steel players by 2025. It wants the top 10 mills to account for 60 percent of output, up from 37 percent of 2014's production of 823 million tonnes. Investors are backing the plan, pushing the shares of some big companies up sharply in 2014, led by Maanshan Iron & Steel whose shares have more than trebled in the past year.

✍ Fed holds rate at zero, no hint for hike The FOMC indicated after its March meeting that a rate hike in April was unlikely. The US central bank has kept its key funds rate anchored near zero since late 2008, amid the financial crisis. Officials have indicated a desire to raise rates at some point this year, with the market now anticipating a September increase.


The move came amid a struggling US economy that barely registered any growth at all in the first three months of the year- a meager 0.2 percent increase in gross domestic product, thanks to a stubbornly frugal consumer, strengthening dollar and rough winter. However, many market participants believe the Fed is still on its course of tightening, though the timing remains a question. "It's the long-term trend that matters to the Fed," said Michael Arone, chief investment strategist for State Street Global Advisors' US intermediary business. "They've been very consistent on the idea of data dependence.:" "Growth in household spending declined; households' real incomes rose strongly, partly reflecting earlier declines in energy prices, and consumer sentiment remains high," the FOMC said. "They are willing to look through that weakness," said John Bellows, portfolio manager at Western Asset Management. "They think it's oil, they think it's the dollar and they think the economy is going to be stronger in the second and third quarter. And whether or not we hike in September or later really depends on whether they are right on that call."

� BULLION * Gold retains overnight gains of nearly 2 percent. * Fed's two-day policy meet begins Tuesday. Gold clung to sharp overnight gains on Tuesday, bolstered by a weaker dollar and short-covering on rising expectations the Federal Reserve would not hint at a June rate increase at its policy meeting this week. Spot gold was steady at $1,200.90 an ounce at 0645 GMT after jumping nearly 2 percent in the previous session. The metal rose to its highest in a week at $1,207.01 on Monday on short-covering ahead of the Fed's two-day meeting, which kicks off on Tuesday. A statement will be released on Wednesday. "Nobody thinks an interest rate hike is going to come in June because of weak economic data," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong. Expectations had centred on a rate rise in June, but after recent sluggish economic data, many now believe the U.S. Central bank will probably not act until later in the year.


If the Fed continues to hold rates near rock-bottom levels, gold prices could be supported. Higher rates, however, could dent demand for bullion, a non-interest-paying asset. A soft dollar was also helping gold on Tuesday. It fell to a three-week low against a basket of major currencies as the euro gained on hopes Greece was a step closer to securing fresh funding. Weakness in the greenback typically boosts gold, seen as a safe haven at times of financial turbulence. Options-related buying also buoyed prices on Monday as U.S. Recent sluggish economic data from the United States led the market to expect the Fed will probably not act until later in the year. A rate hike could dent demand for bullion as investors' appetite for non-yielding assets diminish. � BASE METAL Copper prices rallied to a five-week high on Thursday, as the U.S. dollar tumbled with a June rate hike now looking less likely. On the Comex division of the New York Mercantile Exchange, copper for July delivery touched an intraday peak of $2.834 a pound, the most since March 26, before trading at $2.833 during European morning hours, up 3.4 cents, or 1.21%. A day earlier, copper tacked on 1.2 cents, or 0.45%, to end at $2.799. Futures were likely to find support at $2.735, the low from April 27, and resistance at $2.868, the high from March 26. The U.S. dollar index, which measures the greenback's strength against a trade-weighted basket of six major currencies, was down 0.8% to trade at 94.57 early on Thursday, the weakest level since February 26. The Federal Reserve kept interest rates on hold following the conclusion of its Federal Open Market Committee meeting on Wednesday, but offered little hints on the timing of its first rate hike in nearly a decade. In its policy statement, the Fed said it will take into account labor market conditions, inflationary pressures and expectations of international financial developments when it decides on the timing of a rate increase. The central bank removed all calendar references on a potential window for raising rates from its statement, adding to uncertainty over the timing of a Fed rate hike. The statement came after data on Wednesday showed that the U.S. economy grew just 0.2% in the three months to March, slowing sharply from 2.2% in the final quarter of 2014.

Zinc prices rose by 0.98 per cent on Monday at the domestic markets due to the decline in the zinc stockpiles at the London Metal Exchange (LME) on account of the strong demand for the


commodity. LME zinc stocks fell by 2650 metric tonnes to 478725 metric tonnes as on April 27, 2015. Zinc futures for April 2015 contract, at MCX, were trading at Rs 144.50 per kg, up by 0.98 per cent after opening at Rs. 143.30 against the previous closing price of Rs. 143.10. Major refined zinc exporting countries are Canada, Australia and Rep. of Korea, while major refined zinc importing countries are China, USA and Germany. Lead futures rose 0.19 per cent to Rs 132 per kg today on rising demand in spot markets and positive global cues. Besides strong demand from battery-makers, a firm trend in copper and other base metals overseas influenced lead prices at futures trade. At the MCX, Lead futures, for the April 2015 contract, is trading at Rs 132 per kg, up by 0.19 per cent, after opening at Rs 132.20, against a previous close of Rs 131.75. Sentiment improved further due to the decline in the lead stockpiles at the London Metal Exchange (LME) on account of the strong demand for the commodity. LME lead stocks fell by 4000 metric tonnes to 179100 metric tonnes as on April 29, 2015.

� ENERGY � Crude Oil Fell more than 1 percent on Tuesday ahead of weekly U.S. crude inventory data that is expected to hit another high and as Saudi Arabia pledged to supply more oil to China if needed. U.S. commercial crude stockpiles were expected to have risen last week for the 16th straight week, up from a record 489 million barrels, even though drilling activity fell, a preliminary survey by Reuters showed on Monday. Comments from top Saudi oil officials on Monday reiterated the country's position of keeping production high to meet demand as it maintains its market share. Brent June crude futures had dropped 84 cents to USD 63.99 a barrel by 0702 GMT. US June crude fell 84 cents to USD 56.14 a barrel. The fall in prices "reflects the major gains that have been made in the last few weeks and a little bit of concern over what the inventory numbers in the U.S. might show", said Michael McCarthy, chief strategist at CMC Markets in Sydney. Brent crude hit a 4-1/2 month high last week, while West Texas Intermediate (WTI) has risen for six consecutive weeks, underpinned by net long positions on both contracts as speculators bet on a decline in U.S. shale output. While a roughly 50 percent drop in global oil prices since June last year has helped economies in Asia, it has posed "difficult challenges" for many oil producers, Saudi Arabian Oil Minister


Ali al-Naimi said on Tuesday. "Sudden rises or falls in the cost of oil are not welcome ... It's in all our interests to ensure stable prices," he said in Beijing. Geopolitical tension, mainly in Yemen and Syria, and unplanned production outages, including in the North Sea and Brazil, have prompted Barclays to raise its oil price forecast. While maritime laws allow innocent passage into the strait, much of the area is still located in Iranian territory. When the Iranian patrol ordered the commercial vessel deeper into Iran waters, the captain of the ship reportedly refused, prompting the firing of several rounds of shots. The ship then sent out a distressed call, according to NBC News, that caused the U.S. Navy to dispatch a destroyer – the U.S.S. Farragut and several planes to observe the situation. The UN reportedly became close to brokering a deal between Saudi Arabia and a group of Shiite-led Houthi rebels last month, before talks collapsed amid a series of Saudi air strikes. More than 3,000 people in Yemen are feared dead from the month-long air campaign. ✍ Natural Gas Futures plummeted in the domestic and overseas market on Monday as investors and speculators exited positions in the energy commodity amid bets that the end of the winter season may curb demand for the heating fuel. Latest weather forecasting models called for mostly mild weather across the US. About 49 per cent of American households use natural gas for heating purposes. At the MCX, Natural Gas futures for April 2015 contract closed at Rs 157.3 per 1 kg, down by 2.48 per cent after opening at Rs 160, against the previous closing price of Rs 161.3. Natural Gas futures closed higher in the domestic and overseas market on Tuesday as the sharp losses in the energy commodity in the previous session offered investors and speculators good bargain buying opportunity, at existing levels. Prices had plummeted on Monday amid speculation that the end of the winter season in the US may cut heating demand for the fuel in the world’s biggest economy. About 49 per cent of US households use natural gas for heating purposes. At the MCX, Natural Gas futures for April 2015 contract closed at Rs 161.5 per 1 kg, up by 0.75 per cent after opening at Rs 159.7, against the previous closing price of Rs 160.3.

✍ NCDEX - WEEKLY NEWS LETTERS ✍ NCDC DISBURSES OVER RS 5,700 CR TO AGRI CO-OPERATIVE SOCIETIES


The government's agri-financing body National Co-operative Development Corporation today said it disbursed over Rs 5,700 crore to cooperative societies during the last financial year. The disbursal was about 8-9 per cent higher than the 2013-14 fiscal. "We disbursed over Rs 5,700 crore during last fiscal, of which about Rs 3,600 crore was for marketing and procurement of agricultural produce, NCDC was established by an Act of Parliament in 1963 as a statutory corporation under the Union Agriculture Ministry for developing rural economic activities through co-operatives. Minister of State for Agriculture Mohanbhai Kundaria presented NCDC award for Co-operative Excellence-2014 to 31 best performing co-operatives from different states. NCDC gave 28 state-level awards and 3 national awards this year. Underlining the key role of NCDC, Kundaria said the schemes are helping co-operatives build infrastructure for storage, cold storage and agro-based processing units in the rural areas. It also assists them in distribution of agriculture inputs and marketing of agriculture produce to give better price to farmers. The minister said that NCDC has so far disbursed more than Rs 52,000 crore for various co-operatives development programmes. The period of repayment of loan ranges from 3 to 8 years. The rate of interest varies from time to time. � CHANA Chana fell by 0.98% to Rs 4,238 per quintal in futures trade Tuesday after speculators booked profits at prevailing higher levels amid a decline in demand in the spot market. However, lower output reports due to unseasonal rains in key producing areas, capped the fall. At the National Commodity and Derivative Exchange, chana for delivery in June dropped by Rs 42, or 0.98%, to Rs 4,238 per quintal with an open interest of 76,450 lots. Similarly, the commodity for delivery in May declined by Rs 39, or 0.92%, to Rs 4,187 per quintal in 99,060 lots. Besides profit-booking by speculators at existing levels, fall in demand in the spot market against adequate stocks position mainly pulled down chana prices at futures trade.

� JEERA Amid profit-booking by participants, jeera prices declined by 0.68% to Rs 18,160 per quintal in


futures trading on thursdsay. However, expectations of lower output due to unseasonal rains in major growing regions restricted the fall. At the National Commodity and Derivatives Exchange, jeera for delivery in June month moved down by Rs 125, or 0.68% to Rs 18,160 per quintal with an open interest of 12,396 lots. Similarly, the spice for delivery in May contracts traded lower by Rs 105, or 0.59% to Rs 17,790 per quintal in 17,076 lots. Besides profit-booking by speculators at existing levels, fall in demand in the spot market against adequate stocks position, weighed on jeera prices at futures trade.

� REFINED SOYA Refined soya oil prices fell further by 0.67 per cent to Rs 572.80 per 10 kg in futures trade on Wednesday as speculators trimmed positions following subdued demand in spot market against adequate stocks. At the National Commodity and Derivatives Exchange, refined soya oil for delivery in August eased by Rs 3.85, or 0.67 per cent to Rs 572.80 per 10 kg with an open interest of 1,53,870 lots. Similarly, oil for delivery in June shed Rs 2.45, or 0.42 per cent to Rs 584.70 per 10 kg in 1,11,705 lots. Market analysts said offloading of positions by speculators, driven by sluggish demand in spot market against adequate stocks position mainly kept refined soya oil prices lower at futures trade.


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