Commodities Weekly Tracker 16th Sept 2013

7/29/2019 Commodities Weekly Tracker 16th Sept 2013

1/23

Commodities & Currencies

Weekly Tracker


2/23

Commodities Weekly TrackerContents

Returns

Non Agri Commodities Currencies

Agri Commodities

Non-Agri Commodities

Gold

Silver

Copper Crude Oil

Currencies DX, Euro, INR

Agri Commodities

Chana

Black Pepper Turmeric

Jeera

Soybean

Refine Soy Oil & CPO

Sugar

Kapas

Monday| September 16, 2013


3/23

Commodities Weekly TrackerMonday | September 16, 2013

3.9

3.0 3.02.9 2.8

2.4

2.0 2.0

1.6

1.3

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Global Equities Performance (%)


4/23


1.6

0.9

0.2

(0.9)

(1.4)

(2.0)

(2.9)(3.1)

(3.5)

(3.0)

(2.5)

(2.0)

(1.5)

(1.0)

(0.5)0.0

0.5

1.0

1.5

2.0

Currencies Weekly Performance


5/23


4.1

(0.6)(1.1) (1.3) (1.5)

(2.1)(2.8)

(4.6)

(6.8)(7.0)

(5.0)

(3.0)

(1.0)

1.0

3.0

Non-Agri Commodities Weekly Performance


6/23

*Weekly Performance for October contract

CPO and Mentha Oil - September contract

*Kapas- April 2014 Contract

Commodities Weekly TrackerMonday| September 16, 2013


7/23


GoldWeekly Price Performance

Week-on-week fall in gold prices on the MCX has been around 7.2 percent, with the

yellow metal touching a low of Rs29,501/10 gms on the futures market.

Rupee appreciation is the major factor that is adding downside pressure. During thelast week, Spot Gold prices have dropped around 4.6 percent and tested a low of

$1304.56/oz.

While overall international factors are acting as a negative factor in gold prices in the

short-term, it is the currency factor that is exerting downside pressure in gold prices

in the domestic markets.

Year-to-date Price Performance

While gold prices in dollar terms are down by more than 20 percent over the year, on

the other hand, MCX gold prices are down by just around 4 percent.

In the Indian markets, over the year Rupee depreciation has acted as a catalyst

capping sharp fall in prices.

SPDR Gold Holdings

Holdings in the SPDR Gold Trust witnessed a decline by 8.11 metric tonnes to 911.12

tonnes on 13thSeptember13 , marking a fall of around 0.9 percent in the last week.

On a year-to-date basis, holdings have slipped sharply by 439.7 tonnes, making a drop

of 32.5 percent.

South Africas gold production rose for the first time in 27 months in July

South Africa is the sixth largest producer of gold and has the biggest reserves of

platinum and chrome

Bullion output rose 0.9 percent from a year earlier, leading to 0.6 percent gain in the

total mining production that had slumped by 5.4 percent a month earlier

The country lost output of around $1.5 billion due to labor unrest in platinum mines in

August last year that spread to gold, iron-ore, chrome and coal producers later.

CFTC Data

As per the US Commodity Futures Trading Commission (CFTC) data, net-long position

in gold held by hedge funds and speculators fell 16 percent to 84,929 contracts.

1,200

1,300

1,400

1,500

1,600

1,700

1,800

1,900

25,000

26,000

27,000

28,000

29,000

30,000

31,000

32,000

33,000

34,000

35,000

MCX and Comex Go ld Price Performance

MCX-Near Month Gold Futures -Rs/10 gms Comex Gold Futures -$/oz

79.0

80.0

81.0

82.0

83.0

84.0

85.0

1,150

1,250

1,350

1,450

1,550

1,650

Spot Gold Vs Dollar In dex

Spot Gol d -$ /o z US Do ll ar In de x


8/23


GoldGold demand in India to fall in H2 2013 - Gold Field Mineral Services (GFMS)

Indian gold demand is expected to fall as the Indian government introduced a series of measures to curb gold imports, in order to curb the

widening trade deficit as per London based GFMS. In the first half of 2013, Indian jewelry fabrication jumped by 25 percent to almost 350tonnes. However, China is now poised to overtake India by 100 tonnes this year due to physical buying of as high as 620 tonnes in the first six

months of the year

World Gold demand to slide before prices gain in 2014 - GFMS

GFMS sees gold demand falling in the second half of 2013 due to drop in bar buying and lesser addition of gold to reserves by the central

banks. Total demand will slide to 2,237 metric tons this half from 2,533 tons in the first six months of 2013 and 2,309 tons a year earlier

Jewelry demand in the first half of 2013 reached a six year high as demand in China surged 41 percent to a record 345 tons and Jewelry usage

jumped 23 percent to 1,137 tons in the first half from a year earlier. Central banks added 191 tons to reserves in the first half, 32 percent less

than a year earlier, and buying is predicted to slow down to 170 tons in the second half of 2013. It further added that the Bar purchases rose

52 percent to 725 tons in the first half and will ease to 441 tons in the six months through December

Outlook

Over the week, gold prices are likely to take cues from the outcome of the FOMC monetary policy review that is scheduled for the 17-18 th

Sep13.

Ahead of the FOMC monetary policy review, gold prices in the international and domestic markets are expected to remain under pressure and

post that the trend in the yellow metal will be largely dependent on the decision the Federal Reserve takes towards the QE taper.

Weekly Technical Levels

Spot Gold : Support $1290/$1253 Resistance $1350/$1380 (CMP: $1327.10)

Sell MCX Gold October between 30,500-30,600, SL-31,501, Target -29,100. (CMP: Rs.30060)


9/23


SilverWeekly Price Performance

Declining around 10 percent on the MCX near-month futures contract, silver

prices touched a low of Rs49,160/kg.

Rupee appreciation coupled with negative cues from gold prices led to the fall

in silver.

Spot Silver prices during the last week fell 6.8 percent and tested a low of

$21.35/oz.

ETF Performance

The iShares Silver Trust rose in the last week on account of positive economic

data from advanced economies, that led to increased interest in silver

Tonnage of silver bullion bars held by the US silver ETF increased around 30

tonnes, i.e. 0.3 percent to 10,536.70 tonnes till 12th September 2013. On a year-to-date basis, ETF holdings rose by 478.74 tonnes making an

increase of 4.75 percent.

Factor affecting the silver prices

Fall in Gold prices.

Downside trend in base metal prices acted negative factor to the white metal.

However, sharp fall in prices was cushioned as a result of weakness in the DX

coupled with bounce back in holdings of the iShares Silver Trust ETF.

Outlook Over the week, the price trend in silver is expected to be mixed as world

markets await the decision by the Federal Reserve towards its QE pullback

decision. If the Fed goes ahead with the tapering, then prices are expected to

correct sharply, while on the other hand no decision could provide respite to

falling prices.


Spot Silver: Support $21.02 /$19.82 Resistance $22.50/$23.65. (CMP:$22.20)

Sell MCX Silver December between 51,450-51,550, SL-52,501, Target -48,300.

(CMP: Rs.50,510)

18

20

22

24

26

28

30

32

38,500

43,500

48,500

53,500

58,500

MCX and Comex Silver Price Performance

MCX-Near Month Silver Futures -Rs/ kg Comex Si lver Futures -$/oz

79.0

80.0

81.0

82.0

83.0

84.0

85.0

18.0

20.0

22.0

24.0

26.0

28.0

30.0

32.0

Spot Silver Vs US Dollar I ndex

Sp ot Si lve r -$ /o z US D ol lar In de x


10/23


CopperWeekly Price Performance

Copper prices on the LME slipped around 1.3 percent in last week and touched a low of

$7024/tonne on Friday.

Prices declined during the later part of the week on the back of favorable economicdata from the US that increased concerns of QE tapering from the Federal Reserve in

its meeting next week.

Further, decline in industrial production data from Euro Zone exerted downside

pressure on prices. In the early part of the week, prices rose on account of positive

economic data from Chinese economy.

In the Indian markets, appreciation in the Rupee acted as a negative factor.

Copper Inventories

On the LME last week, copper inventories declined around 3.8 percent to 577,525tonnes as on 13th September 2013 from 600,275 tonnes last week.

While Shanghai inventories rose 3.6 percent to 157,164 tonnes during the same period.

Chinese Refined copper production rises in August

Chinese production rose 4.9 percent in August, reversing a fall the previous month, as

some smelters likely stepped up operations ahead of seasonal demand hike in

September-October

The August output of refined copper was 560,515 tonnes in August, the third-highest

this year and 11.2 percent up from last year

Seasonal demand as seen in the previous years had risen in September to November,leading to increased buying as orders are expected to rise

Outlook

Despite falling inventories and supportive economic indicators, copper prices could

witness a mixed trend over the week on the back of uncertainty surrounding the FOMC

QE tapering decision.


LME Copper: Support $6975/$6870 Resistance $7120/$7200. (CMP: $7064)

Sell MCX Copper November between 465-467, SL-477.10, Target -449. (CMP: Rs459.90)

365

385

405

425

445

465

485

505

525

6,700

6,900

7,100

7,300

7,500

7,700

7,900

8,100

8,300

LME and MCX Copper Price Performance

LME Copper Future ($/tonne) MCX Near Month Copper Contract (Rs/kg)

6,700

6,900

7,100

7,300

7,500

7,700

7,900

8,100

8,300

318,000

368,000

418,000

468,000

518,000

568,000

618,000

668,000

LME Copper v/s LME Inventory

Copper LME Inventory (tonnes) LME Copper Future ($/tonne)


11/23


Crude OilWeekly Price Performance

Easing Geopolitical tensions in Syria led to drop in crude oil prices that touched a low of

$106.39/bbl, with prices on the Nymex contract declining by more than 2 percent during

the week. The MCX near-month crude oil contract witnessed fall due to Rupee appreciation and

the commodity fell around 5 percent over the week, touching a low of Rs6778/bbl.

Oil Inventories

As per the US Energy Department (EIA) report, US crude oil inventories declined by 0.2

million barrels to 360.0 million barrels for the week ending on 6th September 2013.

The American Petroleum Institute (API) report showed, US crude oil inventories declined

by 2.9 million barrels to 359.5 million barrels for the week ending on 6th September 13.

US Crude oil output highest since 1989 on Fracking

US crude oil production jumped to the highest level since 1989 last week which led to

the US cutting consumption of foreign fuel

Energy Information Administration said fracking pushed crude output up by 124,000

barrels, or 1.6 percent, to 7.745 million barrels a day in the seven days ended September

6

US has become the worlds largest exporter of refined fuels including gasoline and diesel

due to Rising crude supplies from fields including North Dakotas Bakken shale and the

Eagle Ford in Texas

Crude fluctuated throughout the week on Syria concerns WTI fluctuated between gains and losses as the US and Russia discussed plans for Syria

to surrender its chemical weapons

Concerns about the Syria crisis spreading to other Middle east countries has fuelled

supply concerns

During the week, concerns were eased by the US deciding to plan limited military strikes

against Syria, which can be cancelled completely if Syria surrenders its chemical

weapons as proposed by Russia

The swing in the Crude price continues as the US and Russia are yet to come up with a

well defined surrender plan for Syria

86.0

90.0

94.0

98.0

102.0

106.0

110.0

114.0

4,700

5,200

5,700

6,200

6,700

7,200

7,700

Nymex and MCX Crude Oil Price Performance

MCX crude oil (Rs/bbl) NYMEX Crude Oi l ($/bbl)

361.3

360.3

363.1369.1

371.7

372.2

376.4

377.53

381.4

384

382.7

385.9

388.6 388.9

387.6

388.6

395.3 395.5

394.9 394.6

397.6

391.3

393.8

394.1

394.1

383.8

373.9

367

364.2

364.6

363.3 360.5

360.21360360

365

370

375

380

385

390

395

400

Crude Oil Inventories (mn barrels)


12/23


Crude Oil

WTI Crude swung between gains and losses on declining Cushing stockpiles, ample Saudi output

Crude fluctuated as stockpiles at Cushing, Oklahoma, declined to the lowest level since February 2012 along with rise in refinery

utilization and amply supply from Saudi Arabia

Cushing inventories, slid for a 10th week, the longest stretch in two years and refineries ran at 92.5 percent of capacity, the

highest level for this time of year since 2006 according to EIA

Ali Al-Naimi, Saudi Arabias oil minister, said the nation will meet additional demand as geopolitical concerns dominate the market

and that the global oil market is well supplied

CFTC Data

As per the CFTC report, bullish bets on crude oil fell around 5.2 percent to 290,058 contracts the lowest since 9th July 2013.

Outlook

During the week, crude oil prices are expected to trade lower on the back of easing Syrian concerns. Further, US and Russia are planning diplomatic actions towards Syria and with no military actions around the corner, the stress of

oil supply disruptions has reduced, thus leading to downside pressure on oil prices

In the Indian markets, Rupee factor will play a crucial role in determining the prices movement of the commodity.


Nymex Crude: Support $106.40/$104.30 Resistance $110.50/$112.50. (CMP: $108.60)

Sell MCX Crude September between 7020-7040, SL-7201, Target -6750.(CMP: Rs 6923)


13/23


RupeeWeekly Price Performance

During the last week, the Rupee appreciated around 3 percent on the back of favorable

industrial production and manufacturing output data from the country.

Further, decline in countrys inflation data supported an upside in the currency.

Additionally, expectations of new measures to be declared by Reserve Bank of India (RBI)

Governor acted as a positive factor.

The Indian Rupee touched a weekly high of 62.91 and closed at 63.37 on Friday.

Capital inflows strengthen Rupee

For the month of September 2013, FII inflows totaled at Rs.6372.20 crores ($986.41 million)

as on 13th September 2013. Year to date basis, net capital inflows stood at Rs.66542 crores

($12569.70 million) till 13th September 2013.

Indias Economic Data during the week Indias Industrial Production gained by 2.6 percent in July as against a decline of 2.2 percent

a month ago.

Manufacturing Output rose by 3 percent in July from fall of 2.2 percent in prior month.

Consumer Price Index (CPI) dropped to 9.5 percent in August with respect to 9.6 percent in

July.

Cabinet Ministry Approval for infrastructure bonds

Cabinet Ministry on Thursday has approved for purchase of $4.3 billion infrastructure

bonds issued by World Bank.

The countrys main aim is to develop infrastructure projects and is targeting $1 trillion

investment by foreign funds till 2017.

The Reserve Bank of India (RBI) would invest in the bonds floated by the International Bank

for Reconstruction and Development (IBRD) that is a lending arm of the World Bank.

As per World Economic Forum, Indias infrastructure is ranked worse than Kazakhstan and

Guatemala.

Outlook

While sentiments and recently announced

measures by the RBI indicate a supportive trend

for the Rupee, risks to depreciation in the

currency remain as the Indian inflation scenario

worsens at a time when the country is grappling

with domestic and global economic issues.

Also, during the week the decision by the FOMC

and the RBI will help set a clearer trend for the

Rupee.

Considering the rising inflation and risks to

further weakness in the Rupee, the RBI is not

likely to take a stance of reducing interest rates.


USD-INR August Contract: Support 61.80/60.30

Resistance 64.20/65.70 (CMP: 62.85)

53.0

55.0

57.0

59.0

61.0

63.0

65.0

67.0

69.0

$/INR - Spot


14/23


Dollar IndexWeekly Price Performance

Over the week, the Dollar Index weakened on the back of rise in risk appetite in the

global market sentiments.

Further, decline in US jobless claims data which was at lowest level since April 2006

acted as a negative factor.

However, sharp downside in the currency was cushioned as a result of unfavorable

retail sales and consumer sentiments data from US.

Additionally, decline in jobless claims data increased concerns of QE tapering from

Federal Reserve in its meeting during the week.

Likely Scenarios with respect to the FOMC Decision

Scenario 1: At the start of the month in our Economic Report dated 4 th Sep13, we

were expecting the QE taper to be delayed as Syrian tensions had heightened and hadhit the world markets by a storm. However, this view may not apply in the current

context as diplomatic decision making is seen towards Syria, thus reducing the risk of a

war.

Scenario 2: The US unemployment rate has dipped to 7.3 percent and unemployment

claims have fallen to the lowest levels since April 2006. a positive jobs market report

could lead the Fed towards making the pullback

Outlook

The Dollar Index is expected to trade on a weaker note as mixed sentiments andexpectations revolve around the FOMC QE taper decision.

In case ofScenario 2, the Dollar Index would strengthen, while the Scenario 1 would be

negative and could lead to weakness in the currency.


Dollar Index: Support 80.40/79.00 Resistance 81.70/82.70 (CMP: 81.11)

79.0

80.0

81.0

82.0

83.0

84.0

85.0

US Dollar Index


15/23


EuroWeekly Price Performance

The Euro appreciated around 1 percent in the last week due to weakness in the

DX. The currency touched a weekly high of 1.3324 and closed at 1.3292 on Friday.

Further, optimistic global market sentiments supported an upside in the

currency.

However, sharp upside in the currency was restricted as a result of unfavorable

economic data from the region.

Economic data from the Euro Zone comes negative

French Industrial Production declined by 0.6 percent in July as against a fall of

1.4 percent a month ago

German Wholesale Price Index (WPI) declined by 0.6 percent in August as

against a fall of 0.3 percent in July.

French Consumer Price Index (CPI) rose by 0.5 percent in last month from drop

of 0.3 percent in July.

Italian Industrial Production declined by 1.1 percent in July with respect to rise

of 0.2 percent in earlier month.

European Industrial Production dropped by 1.5 percent in July when compared

with increase of 0.6 percent in prior month.

Outlook

The Euro is expected to trade on a positive note on the back of upbeat economic

indicators from the Euro Zone and the fact that the region has exited recession,

is a major supportive factor for the currency.


EURO/USD SPOT: Support 1.3170/1.3000 Resistance 1.3530/1.3700. (CMP:

1.3360)

1.275

1.285

1.295

1.305

1.315

1.325

1.335

1.345

1.355

1.365

Euro/$ - Spot

69.0

74.0

79.0

84.0

89.0

94.0

EURO/INR -Spot


16/23

Chana


Weekly Price Performance

Chana futures opened lower last week extending preceding weeks losses on

prospects of a better sowing in the rabi season due to good rains in chana

growing regions. However, prices recovered from lower levels on account of

festive season demand. The spot as well as the October Futures settled 1.72%

and 0.61% higher w-o-w.

Pulses output heading for second year of bumper output

As on 13th September 2013, Pulses sowing is up 5.6 percent at 103.76 lakh ha.

Increase in acreage under kharif pulses this year and above average monsoon

has raised hopes of bumper Pulses output for second straight year in row.

Festive season demand to offset higher supplies

Renewed buying interest from dal millers to meet the festive season demandhave supported chana prices higher despite sufficient supplies. A series of

festivals shall commence in the coming weeks and thus demand side

fundamentals shall remain strong offsetting higher supplies.

Chana output at record high in 2012-13

Ministry of Agriculture released its fourth Advance estimates of Food grain

production last week wherein it pegged Chana significantly higher at record 8.8

mn tn in the current season 2012-13. compared with 7.5 mn tn.

Outlook

Prospects of a higher sowing in the coming season along with comfortable

supply scenario may exert downside pressure on the prices. However,

improvement in demand by the dal millers due to upcoming festivals may

restrict sharp fall.

Weekly Strategy

Sell NCDEX Chana Oct between 3190 3210, SL 3350, Target 3000 (CMP

3150).


17/23

Turmeric

Source: Agriwatch & Reuters

Commodities Weekly Tracker


Turmeric Futures declined last week on the back of huge carryover stocks and

favorable weather conditions. However, fresh overseas as well as domestic

demand ahead of the upcoming festival supported prices at lower levels.

The spot as well as the October Futures settled 3.91% and 3.68% lower w-o-w.

Postponement of launch of contract

According to a circular released by the regulator, launch of April 2014 expiry

contract in Turmeric has been postponed till further notice.

Sowing of Turmeric for the 2013-14 season

The area covered under Turmeric in A.P. as on 11/09/2013 is reported at 0.53

lakh ha against 0.54 lakh ha last year and a normal sowing of 0.66 lakh ha. Normal

sowing for the season is 0.68 lakh hectares.

Better than expected exports

Turmeric exports in 2012-13 stood at 80,050 tn as against 79,500 tn in 2011-12.

Lower production in the 2012-2013 season

Turmeric production in 2012-13 was around 50% lower compared to 2011-12 and

is expected around 45-50 lakh bags. Production in 2011-12 is reported at

historical high of 90 lakh bags/ 10.62 lakh tns.

Outlook

Turmeric prices are expected to trade on a negative note this week as huge

carryover stocks as well as favorable weather conditions may boost the yield this

season. However, overseas as well as domestic demand may restrict a sharp

decline and support prices at lower levels. The withdrawal of monsoon needs to

be watched carefully at this stage, as this may affect the acreage as well as the

yield of the crop.

Weekly Strategy Sell NCDEX Turmeric Oct between 4900 4920, SL 5150, Target 4600/4500

(CMP 4820)

Source: Reuters & Angel Research.

Monday | September 10, 2013


18/23

Jeera

Source: Ministry of Agriculture, Gujarat.



Jeera futures traded with a negative bias last week on account of easing tensions

in Syria coupled with good rains in the jeera belt in Gujarat that have increased

prospects of a better sowing in the upcoming season. However, good overseas aswell as domestic demand supported prices at lower levels. .

The spot as well as the October Futures settled 0.68% and 1.53% lower w-o-w.

Global supply concerns boost Jeera exports

The ongoing tensions in Syria one of the largest exporters of the spice has led to

global supply concerns, and thus, increased exports demand from India.

Jeera exports in 2012-13 stood at 79,900 tn, as against 45,500 tn last year.

Second consecutive year of higher output

Indias 2013 Jeera output is estimated at 40-45 lakh bags (of 55kgs each), higher

than 40 lakh bags in 2012. However, increase in the exports due to supply

concerns in the global markets offset the impact of higher supplies on the prices

and thus, medium term fundamentals remain supportive for the upside.

International Scenario

According to reports, production in Turkey is reported around 8,000-10,000

tonnes while production in Syria is expected to be lower, raising supply concerns

in the international markets.

Currently, 1% Jeera of Indian origin is being offered for Singapore at $2,200/tn(FOB Mumbai) while for Europe at $2,325/tn (CNF) (Source: Agriwatch).

Outlook

Jeera may trade on a mixed note with a negative bias on easing tensions in Syria

coupled with prospects of a better sowing in the upcoming season. Higher

production last year may also keep prices under check. However, overseas as well

as domestic demand ahead of the festive season may support prices.

Weekly Levels Sell NCDEX Jeera Oct between 13600 13630, SL 13930, Target 13100/13000

(CMP13460)

Source: Reuters & Angel Research.



19/23

Soybean


Weekly price performance

Soybean futures traded on a mixed note last week. expectations of new season

arrivals to commence soon pressurized prices initially. However, crop damage

concerns in India as well as the US led to a recovery and supported prices at lowerlevels. The spot settled as well as the Futures settled 0.87% and 0.32% higher w-o-w.

CBOT Soybean September futures gained 3.6% last week due to weather concerns

coupled with lower output forecast in the USDA monthly crop report.

Withdrawal of monsoon

Receding rains in Central India and IMDs expectations that withdrawal of monsoon

to start this week from the north-west part of India may ease the fears of damage to

the standing soy crop. The acreage is higher at record 191.64 lh, up by 12.86%

compared to the same period last year.

Lower harvest and ending stocks

The USDA monthly crop report kept the acreage to 77.2 mn acres unchanged from

its earlier estimates. Harvest estimates have been trimmed to 3.149 bn bushels from

the earlier estimates of 3.255 bn bushels. Forecast of 2013-14 ending stocks have

also been slashed from 220 mn bushels in August to 150 mn bushels.

Soybean 2012-13 output revised up Fourth Advance Estimates

Ministry of Agriculture released its fourth Advance estimates of Food grain

production earlier in July wherein it pegged Soybean output significantly higher at

record 14.6 mn tn in the current season 2012-13 compared with 12.2 mn tn in 2011-12. Total nine Oilseeds production is pegged at 31 MT in 2012-13, slightly higher

than 29.79 MT achieved in the previous year.

Outlook Soybean futures are expected trade on a negative note this week on expectations of

higher output coupled with commencement of arrivals of the new crop in the

coming days. Weak international markets may also pressurize prices. However, tight

supplies coupled with strong meal export demand may support prices.

Strategy

Sell NCDEX Soybean Oct between 3440 3460, SL 3600, Target 3230/3200



20/23

Refine Soy Oil and Crude Palm Oil


Weekly price performance

Edible oil complex traded on a negative note last week due to an appreciation

in the Rupee coupled with weakness in edible oil prices in the internationalmarkets. Soy oil as well as MCX CPO settled 2.25% and 2.9% lower

respectively last week

Prices on KLCE declined 2.96% on expectations of increase in the output

during the seasonally higher yield period. However, export demand

supported prices at lower levels.

Global Scenario

Exports of Malaysian palm oil products in August increased 7.5% to 1,511,755

tons tonnes from 1,406,935 tonnes shipped in July.

Indonesia has cut export tax on crude palm oil to 9% in September from10.5% in August.

Domestic Scenario

As per the data released by the Solvent Extractors' Association of India,

imports of vegetable oils, including non-edible oils, declined 15.52% to

757,830 tn in August, a weak Rupee has made imports more expensive.

India's refined palm oil imports declined 33.03 per cent in August to 213,853

tn from 213,853 tn in July due to overall weakness in the Rupee, which has

made imports expensive.

Monthly soy oil imports rose 69% as local supplies are almost before the

soybean crop enters the markets.

Stockpiles of edible oil at ports on September 1 stood at 505,000 tn, the trade

body said, higher than 610,000 tn on August 1.

Strategy

Sell NCDEX Refined Soya Oil Oct between 660 665, SL 680, Target

630/625 (CMP 652.70)

Sell MCX CPO Sept between 530 535, SL 550, Target 510/500 (CMP

523.50)



21/23

Sugar



Sugar futures traded with a negative bias last week on account of ample supplies

coupled with selling pressure from the millers. upward revision of output forecast

also pressurize prices. However, festive demand has supported prices at lowerlevels. The spot as well as the Futures settled 0.01% and 0.33% lower w-o-w.

LIFFE as well as ICE Sugar settled 0.16% and 1.79% higher on account of improved

physical demand coupled with weather concerns in in Brazil.

India's sugar output seen up next year

According to the Ministry of Agriculture, Sugarcane has been planted in 48.74

lakh ha as compared to 50.06 lakh ha last year.

Excess rains in current season have raised hopes of higher output in the coming

season that shall begin in October 2013. Indian Sugar Mills Association (ISMA) hasprojected 2013-14 sugar production at 23.7 million tonne as against the domestic

requirement of 23.5 million tonne.

Higher exports from Brazil

According to the Trade Ministry of Brazil, raw sugar exports in August increased to

2.68 mn tn against 1.85 mn tn in July on the back of strong Dollar and weak Real.

Forfeiture of sugar from processors

According to a USDA report, US Sugar processors have forfeited about 85,000

tonnes sugar worth about US $ 35 million due to default at the end of August onthe back of lower global prices.

Outlook

Sugar are expected to trade on a mixed note with a negative bias as ample

supplies coupled with selling pressure from the millers to clear their arrears may

keep prices under check. However, expectations of improvement in the physical

demand to meet the festive season requirements may support prices at lower

levels.

Strategy

NCDEX Sugar Oct S1 2965, S2 2950, R1 3005,R2 3025 (CMP 2987)



22/23

Cotton



Cotton prices on MCX declined last week by 0.84% on the back of an appreciation

in the Rupee. Prices have earlier gained due to incessant rains, a weak Rupee and

expectations of delay in arrivals by about 15 days. Kapas Futures on the NCDEXhowever, settled unchanged.

ICE cotton futures traded on positive note last week and settled 2.37% higher as

the USDA report revised lower the output projection coupled with stockpiling from

China. However, higher end stock estimate capped sharp gains.

Cotton Association pegs 2013-14 crop higher

The Cotton Association of India has placed the cotton crop for the 2013-14 season

beginning October 1 at 375 lakh bales (of 170 kg each).

The association revised the 2012-13 crop estimate from the previous 356.75 lakhbales due to conducive weather conditions.

India eyes cotton export duty to boost value added textile sales

India has proposed a 10% duty on cotton exports as it wants to boost overseas sale

of value added textiles taking advantage of the weak rupee.

The move would encourage more textiles & garments to be shipped overseas,

generating more money than simple cotton exports.

China starts cotton stockpiling program from Sept. 9

China started its cotton purchase and reserve plan for the 2013-14 crop year from

Monday as market prices have been lower than the protective price of 2,0400

yuan/metric ton (tonne).

Outlook:

Cotton prices are expected to remained under downside pressure on expectations

harvesting to commence soon in Northern states of India.

Strategy

Sell MCX Cotton Oct between 21300 - 21400, SL -21850, Target 20700


d kl k


23/23

Thank You!

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Commodities Weekly Tracker 16th Sept 2013

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Transcript of Commodities Weekly Tracker 16th Sept 2013