Sep 4 2007 12:43PM
Weekly Spices Report
| BLACK PEPPER | | HIGHLIGHTS OF THE WEEK | | • | Arrivals were nil during the week as compared to 5 tonnes a week ago at Kochi | | • | Domestic pepper prices of Malabar garbled variety declined by around 1.6 per cent week on week to Rs. 12,600 per quintal | | • | Over 50 per cent of the new crop in Indonesia has been reportedly harvested till now | | • | The Forward Markets Commission (FMC) is considering the proposal to hike near month open position limit for pepper futures | | | | | SPOT MARKET PRICES: (Rs/qtl) | | Grade | Centre | Prices | | Aug 20-25 | Aug 27 - Sep 01 | | Garbled | Kochi | 12800-13300 | 12500-12700 | | Ungarbled | Kochi | 12200-12700 | 11900-12100 | | | | | MARKET COMMENTARY | | Black pepper prices remain highly volatile. Prices, despite some recovery towards weekend, finished at a lower level as compared to previous week. Demand continues to remain weak, though traders reported presence of some demand at lower price levels. Global pepper prices have declined recently eyeing the new crop harvest in Indonesia, which has reportedly been harvested over 50 per cent till now and sold to local stockists and exporters. As the balance crop is also harvested and moves into the hands of traders and stockists, downside will be capped. | | | | FUNDAMENTAL OUTLOOK | | Black pepper prices are expected to remain slightly firm in absence of selling interest at lower price levels. | | | | | WEATHER OUTLOOK | | Rain/thundershowers are likely over few places of the pepper growing regions. Prevailing weather conditions remain congenial for proper growth of the newly planted as well as old vines. | | | | TECHNICALS OUTLOOK | | Pepper prices have failed to breach the psychological 13000 mark and declined sharply thereafter. Further decline in prices can be seen, but will find some buying support coming in at the recent low of 11654 and then at 11475. | | | | LEVELS (NCDEX October) | BLACK PEPPER (NCDEX October): | | S2 | S1 | R1 | R2 | | 11000 | 11475 | 13156 | 13629 | | | | STRATEGY: | | Buy on corrective dips towards support. |
| | | JEERA (CUMIN) | | HIGHLIGHTS OF THE WEEK | | • | Arrivals remain on an average steady, while offtake has increased towards weekend | | • | Good rainfall over major producing regions has raised expectation of a better sowing next season | | • | Weak domestic as well as overseas demand for the commodity | | | | | SPOT MARKET PRICES: (Rs/qtl) | | Grade | Centre | Prices | | Aug 20-25 | Aug 27-Sep 01 | | FAQ New | Unjha | 2260-2460 | 2120-2280 | | Ganesh | Unjha | 2400-2580 | 2300-2410 | | Machine-cleaned | Unjha | 2560-2780 | 2400-2610 | | | | | MARKET COMMENTARY | | Jeera markets extended previous weakness further. Prices declined sharply at the beginning of the week amid lack of buying support. However, further decline in prices were capped by improved offtake towards weekend. Arrivals of crop from other producing nations like Syria and Turkey with lower price tag at international market are weighing on the domestic market. Though the long-term fundamentals for jeera remain firm with the supply shortage, both domestically as well as globally, the near-term outlook seems gloomy until demand improves considerably. | | | | FUNDAMENTAL OUTLOOK | | Domestic jeera prices are likely to remain rangebound on some buying support at lower price levels. | |
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| | | | WEATHER OUTLOOK | | Rain/thundershowers are likely over few places in Gujarat and Rajasthan, which may limit regular trading activity. | | | | TECHNICAL OUTLOOK | | Declining prices along with falling open interest as well as volume suggest likely upward movement in place. Technically, the market is oversold and an upward technical correction is expected soon. | | | | LEVELS (NCDEX October) | JEERA (NCDEX October): | | S2 | S1 | R1 | R2 | | 10225 | 10450 | 11370 | 11600 | | | | STRATEGY: | | Buy at corrective dips toward support levels. |
| | | RED CHILLIES | | HIGHLIGHTS OF THE WEEK | | • | Lack of buying interest among local buyers. | | • | Good and steady export advices from Malaysia, Sri Lanka and Bangladesh. | | • | Low arrivals at 25,000-30,000 bags as compared to last week’s arrivals of 40,000-50,000. | | • | Output at Madhya Pradesh is likely to gain due to increase in acreage by 30percent | | | | | SPOT MARKET PRICES: (Rs/qtl) | | Grade | Centre | Prices | | Aug 20 - 25 | Aug 27 – Sep 01 | | LCA 334 | Guntur | 4000-4600 | 4000-4500 | | | | | MARKET COMMENTARY | | Domestic trade at the Guntur market continued to remain sluggish as against week ago. Steady export advices from Bangladesh supported the steady prices. Local buying support in the market turned sluggish and is likely to remain so in the near term. | | | | FUNDAMENTAL OUTLOOK | | Chilli prices during the week ahead is likely to trade range bound to firm in anticipation of good export demand and a minor consolidation is also likely on profit booking during the mid week. | |
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| | | | WEATHER OUTLOOK | | Rain / thundershowers are likely at coastal Andhra Pradesh and coastal Karnataka. Rainfall during the initial growing stage is beneficial for the crop. | | | | TECHNICAL OUTLOOK | | Technically, red chillies chart looks quite indecisive. However, it’s in a slightly upward channel. Close above short-term EMAs suggest some firmness in prices. RSI is in neutral region and would support any move in either direction. Close below 4200 would be a good level to buy. | | | | LEVELS (NCDEX October) | RED CHILLIES (NCDEX October): | | S2 | S1 | R1 | R2 | | 4058 | 4139 | 4573 | 4661 | | | | STRATEGY: | | Buy on dips near support. |
| | | TURMERIC | | HIGHLIGHTS OF THE WEEK | | • | Weak domestic demand in the market. | | • | Steady overseas demand from Gulf and Japan | | • | Low arrivals at the Erode and Nizamabad spot markets as compared to week ago. | | | | | SPOT MARKET PRICES: (Rs/qtl) | | Grade | Centre | Prices | | Aug 20 - 25 | Aug 27 – Sept 01 | | Nizamabad | Finger
Gattah | 2000-2175
1940-2050 | 1950-2000
1875-1925 | | Erode | Finger
Gattah | 2050-2200
2000-2100 | 2025-2100
2000-2050 | | | | | MARKET COMMENTARY | | Turmeric prices were weak amidst low arrivals as well as offtake at the daily auctions held at Nizamabad and Erode. Lack of buying interest among the local buyers amidst steady export advices from the Gulf countries kept the prices subdued in the spot markets. | | | | FUNDAMENTAL OUTLOOK | | Turmeric prices are likely to trade range bound to slightly weak during the week ahead in anticipation of weak domestic demand as well as ample of stock with the buyers. | |
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| | | | WEATHER OUTLOOK | | Rain / Thundershower are likely at coastal Karnataka, coastal Andhra Pradesh, Tamil Nadu and Madhya Maharashtra. Rains at present are beneficial for the crop. | | | | TECHNICAL OUTLOOK | | Turmeric futures chart looks technically weak. Prices closed below the 9-day and 18-day EMA, supporting the weakness in the market. The market is oversold with the RSI reading below 30, thus may lead to some short-term technical recovery. However, selling at such rallies would better pay off. | | | | LEVELS (NCDEX October) | TURMERIC (NCDEX October): | | S2 | S1 | R1 | R2 | | 2043 | 2062 | 2176 | 2206 | | | | STRATEGY: | | Sell on rise near resistance. |
| | | CARDAMOM | | HIGHLIGHTS OF THE WEEK | | • | Weak demand from the buyers at the auction. | | • | Absence of exporters at the auction. | | | | | SPOT MARKET PRICES: (Rs/qtl) | | Auction | Variety | Price/Quintal | | August 25 | September 01 | | Pulianmalai | 7 mm | 460-480 | 485 | | | | | MARKET COMMENTARY | | Cardamom prices at the auction during the week traded steady to rangebound at Rs. 480-490 for the 7 mm good coloured quality as compared to a week ago. The arrivals and offtake were steady. The domestic buying interest was sluggish in the market and failed to support any uptrend in the prices. | | | | FUNDAMENTAL OUTLOOK | | Cardamom prices are likely to remain rangebound to weak in the week ahead due to lack of buying interest among domestic buyers. | | | | | WEATHER OUTLOOK | | Rain/thundershowers are likely at most places at Kerala and Tamil Nadu. Heavy rains during the picking period may damage the crop. | | | | TECHNICAL OUTLOOK | | Prices closed below the 9-day and 18-day EMA, indicating that the trend favours the bears for the short term. RSI is in neutral region and heading southwards, suggesting further decline in prices. Cardamom futures are likely to trade rangebound to slightly weak during the week ahead. | | | | LEVELS (MCX September) | CARDAMOM (MCX September): | | S2 | S1 | R1 | R2 | | 496.5 | 502 | 533 | 542 | | | | STRATEGY: | | Sell near resistance levels. |
| | | DISCLAIMER
This report is prepared exclusively for Reliance Commodities by Indian Rural Market Products Pvt Ltd (IRMPL). The information and opinions contained in the document have been compiled from sources believed to be reliable. IRMPL does not warrant its accuracy, completeness and correctness. Use of data and information contained in this report is at your own risk. This document is not, and should not be construed as, an offer to sell or solicitation to buy any commodities. IRMPL and its affiliates and/or their officers, directors and employees may have positions in any commodities mentioned in this document (or in any related investment) and may from time to time add to or dispose of any such commodities (or investment).
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