Commodities Weekly Tracker -22nd October 2012

7/31/2019 Commodities Weekly Tracker -22nd October 2012

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Commodities & Currencies

Weekly Tracker



Commodities Weekly Tracker

ContentsReturns•

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 | October 22, 2012



Commodities Weekly Tracker Monday | October 22, 2012

2.5

2.0

1.5

1.10.8

0.5

(0.1)(0.4)(0.5)

0.0

0.5

1.0

1.5

2.0

2.5

Currencies Weekly Performance




(0.5)(0.9)

(1.2) (1.4) (1.6)(1.9) (2.0)

(2.6)

(4.2)(4.5)

(3.5)

(2.5)

(1.5)

(0.5)

Non-Agri Commodities Weekly Performance



*Weekly Performance for November contract; Kapas - April 2013 contract, Mentha oil and CPO – November 2012





GoldWeekly Price Performance• Spot gold prices declined 1.9 percent week on week .• The yellow metal touched a weekly low of $1,715.79/oz and closed at

$1,720.49/oz on Friday.• On the MCX, Gold October contract ended 0.1 percent lower taking cues

from bearishness in the spot gold.

ETF Performance• Holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-

traded fund, increased 0.53 percent and stood at 1340.52 tonnes tillOctober 12 2012 as against 1333.44 tonnes till October 05 2012.

Factors that influenced gold prices• Strength in the DX. Rise in risk aversion in the global markets.• Poor U.S. corporate earnings and uncertainty over Spain bailout as the

European Central Bank meeting failed to discuss on that matter.Depreciation in the Indian rupee cushioned sharp fall in the MCX Goldprices.

Outlook • In the coming week, we expect gold prices to witness selling pressure due

to weak global market sentiments along with no conclusive steps stated to

resolve the Euro zone debt crisis is creating bearish market sentiments.• Strength in DX will also exert downside pressure. However, prices might also

take cues from the FOMC meeting to be scheduled on October 24. In thedomestic markets, depreciation in the Indian rupee along with demand fromthe local buyers ahead of festivals is expected to keep prices firm.

Weekly Technical Levels• Spot Gold : Support 1706/1692 Resistance 1730/1744. (CMP: 1722.70)• Buy MCX Gold December between 31,090-31,060, SL-30,900, Target -

31,500. (CMP : 31083)

1,530

1,560

1,590

1,620

1,650

1,680

1,710

1,740

1,7701,800

27,20027,70028,20028,70029,20029,70030,20030,70031,20031,70032,20032,700

MCX and Comex Gold Price Performance

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

78.0

79.0

80.0

81.0

82.0

83.0

84.0

85.0

1,5301,5501,5701,5901,6101,6301,6501,6701,6901,7101,7301,7501,7701,790

Spot Gold Vs US Dollar Index

Spot Gold -$/oz US Dol lar Index




SilverWeekly Price Performance• Spot silver prices declined 4.2 percent•

The white metal touched a weekly low of $31.89/oz and closed at $32.02/ozon Friday.• In the Indian markets, MCX silver prices fell 2.4 percent tracking bearishness

in the spot silver and closed at Rs. 59,872/kg after touching a low of Rs.59,623/kg on Friday. However, depreciation in the Indian rupeecushioned sharp fall in the MCX Silver prices in yesterday’s session.

Factors that influenced silver prices • Weakness in the spot gold prices along with bearishness in the base metals.• Strength in the DX. Rise in risk aversion in the global market sentiments.

ETF performance• On a weekly basis, holdings in the iShares Silver Trust declined 0.06 percent

to 9888.55 tonnes till 19th October 2012 as against 9894.58 tonnes tillOctober 12 th 2012.

Outlook• Silver prices in the coming week is expected to trade with bearish note on

the back of weak global market sentiments along bearishness in the basemetals pack. Strength in the DX is also expected to exert downside pressure

on the silver prices.• Silver prices might also take cues from the FOMC meeting to be scheduled

on October 24. In the domestic markets depreciation in the Indian Rupeemight cushion sharp fall in the MCX Silver prices.

Weekly Technical Levels• Sell MCX Silver December between 60,150-60,200, SL-61,011, Target -

59,300/58,700. (CMP: 59532)• Spot Silver : Support 31.48/30.94 Resistance 32.43/32.97. (CMP: 32.15)

262728293031323334353637

50,500

52,000

53,500

55,000

56,500

58,000

59,500

61,000

62,500

64,00065,500

MCX and Comex Silver Price Performance

MCX-Near Mo nth Si lve r Fu tu res -Rs/ kg Comex Si lve r Futures -$/oz

78.0

79.0

80.0

81.082.0

83.0

84.0

85.0

26.0

27.5

29.0

30.5

32.0

33.5

35.0

36.5

Spot Silver Vs US Dollar Index

Spot Silver -$ /oz US Dollar Index




CopperWeekly Price Performance• Copper, the leader of the base metals pack declined by 1.6 percent week on

week and closed at $7,992.25/tonne on Friday.

Copper Inventories• The red metal’s inventories on the LME warehouses increased around 2.3

percent to 220,900 tonnes on 19 th October 2012 from the previous level of 215,900 tonnes on 12 th October 2012.

• Copper inventories at warehouse monitored by the Shanghai FuturesExchange increased by 8.4 percent to 196,710 tonnes in the week ended 19 th October.

Factors that influenced copper prices• Mixed global market sentiments coupled with strength in the DX . Rise in LME

& Shanghai Copper inventories.• Additionally, slowdown in the Chinese economy also added downside

pressure on the prices.

Outlook• Weak export data from the Japanese economy along with slower growth in

China might reduce the demand from key consuming nation. No no specificsteps stated in the meeting to resolve the Euro zone debt crisis are creatingbearish market sentiments.

• However, there is expectation that stimulus measures could be announced inJapan to boost the economy which might increase the demand for the basemetals. This might cushion sharp fall in the prices.

• Depreciation in the Indian Rupee will act as a supportive factor for the copperprices on MCX.

Weekly Technical Levels • Sell MCX Copper November between 437.50-439, SL-443.10, Target -

430.20/427. (CMP: 431.90)• LME Copper: Support $7896/$7800 Resistance $8173/8355. (CMP: 8013)

385390395400405410415420425430435440445450455460

7,100

7,300

7,500

7,700

7,900

8,100

8,300

8,500

8,700

8,900

LME and MCX Copper Price Performance

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




Crude OilWeekly Price Performance• On a weekly basis, Nymex crude oil prices declined by 2 percent.•

On the domestic bourses, prices declined by 0.1 percent and closed atRs.4,848/bbl on Friday after touching a low of Rs.4,785/bbl in the last week.However, depreciation in the Indian Rupee prevented sharp fall in the prices .

US Energy Department Facts and Figures• As per the US Energy Department (EIA) report released last week, US crude oil

inventories increased more than expected by 2.86 million barrels to 369.20million barrels for the week ending on 12th October 2012.

• Gasoline stocks rose by 1.72 million barrels to 197.10 million barrels andwhereas distillate stockpiles drop by 2.20 million barrels to 118.70 million

barrels for the last week.Factors that influenced crude oil prices • European policymakers failed to discuss over Spain bailout .• Rise in US crude oil inventories. Strength in the DX.• However, sharp downside in the prices was cushioned as a result of shut in the

Keystone pipeline for three days by TransCanada Corporation which transfers590,000 barrels of oil a day from Canada to midcontinent.

Outlook• Crude oil prices are expected to trade with a negative bias anticipating reduction

in the demand after observing slower growth in Chinese economy and weakdata from the US and Japan. Strength in the DX might also exert downsidepressure on the crude oil prices . In the domestic market depreciation in theIndian Rupee is expected to cushion sharp fall in the prices.

Weekly Technical Levels • Sell MCX Crude November between 4940-4960, SL-5031, Target -4820/4770.

(CMP: 4848)• Nymex Crude Oil: Support: $89.35/88.10 Resistance $92.30/94.80. (CMP:

90.76)

75.0

80.0

85.0

90.0

95.0

100.0

105.0

110.0

4,4004,5004,6004,7004,8004,9005,0005,1005,2005,3005,4005,5005,600

Nymex and MCX Crude Oil Price Performance

MCX crude oil (Rs/bbl) NYMEX Crude Oil ($/bbl)

320

330

340

350

360

370

380

390Crude Oil Inventories (mn barrels)




DX/ INRWeekly Price Performance• US Dollar Index swung between gains and losses and ended 0.1 percent lower.• The Indian Rupee depreciated around 2 percent week on week.

Factors that influenced movement in the DX• US Dollar Index swung between gains and losses and ended 0.1 percent lower. However,

the index reversed some of earlier losses and ended 0.1 percent higher on Friday on theback of rise in the risk aversion taking cues from weak global market sentiments causedby uncertainty over Spain bailout and weak economic data from the US economy.However, the index traded lower in the early part of the week due to favorable datafrom the retail sales and manufacturing data from the US and Spain retaining theinvestment grade credit rating by the Moody’s .

Factors that influenced movement in the Rupee• The Indian Rupee depreciated around 2 percent in the last week. The currency

depreciated taking cues from dollar demand from oil importers, defense relatedcompanies along with requirement from foreign banks. Additionally, strength in the DXalso added downside pressure on the currency.

• However, sharp downside in the currency was cushioned as result of upbeat domesticmarket sentiments. The currency touched a low of 53.99 during the week and closed at53.84 on Friday.

FII Inflows•

For the current month FII inflows totaled at Rs. 11,113.50 crores till 19th October 2012.While year to date basis, net capital inflows stood at Rs. 175,859.30 crores till 19thOctober 2012.

Outlook• We expect rupee to depreciate in the current week as reforms announced are awaiting

implementation. Further, month end dollar demand from the oil importers is alsoexpected to depreciate the domestic currency.

Weekly Technical Levels• USD/INR MCX October: Support 52.85/52.1 Resistance 54.45/55 (CMP:53.7)• US Dollar Index: Support 78.95/78.45 Resistance 80.2/81 (CMP: 79.6)

77.077.578.078.579.079.580.080.581.081.582.082.583.083.584.084.585.085.586.0

US Dollar Index

48.0

49.0

50.0

51.052.0

53.0

54.0

55.0

56.0

57.0

58.0

$/INR -Spot




EuroWeekly Price Performance• The Euro appreciated 0.5 percent week on week .• The currency touched a high of 1.3139 and closed at 1.3021 on Friday.

Factors that influenced movement in the Euro• Euro gained 0.5 percent week on week due to optimism that European leaders were

committed to establish the Euro area bank supervisor by this year end. However theyfailed to discuss Spain bailout.

• Additionally , weakness in the DX also supported an upside in the currency.

News• German Producer Price Index (PPI) increased by 0.3 percent in September as against a

previous rise of 0.5 percent in August. European Current Account was at a surplus of 8.8 billion Euros in August from previous surplus of 8.1 billion a month ago.

• German ZEW Economic Sentiment was at -11.5-mark in October from previous fall of 18.2-level in September. Consumer Price Index (CPI) was at 2.6 percent in Septemberas compared to rise of 2.7 percent in August. Core CPI remained unchanged at 1.5percent in the month of September.

• European ZEW Economic Sentiment was at -1.4-level in October with respect toprevious decline of 3.8-mark in September. European Trade Balance was at a surplus of 9.9 billion Euros in August when compared to earlier surplus of 7.2 billion Euros in priormonth.

• European Central Bank policy leaders were committed to establishment a euro-areabank supervisor by year-end, opening the prospect of direct aid to Spain’s banks.

Outlook• We expect the Euro to trade range bound as Spain Prime Minister Mariano Rajoy wins

the majority vote and thus prospects of seeking a bailout could be achieved. However,strength in the DX is expected to cap sharp gains.

Weekly Technical Levels• EURO/USD SPOT: Support 1.289/1.2755 Resistance 1.317/1.3284 (CMP:1.3055)

1.15

1.18

1.21

1.24

1.27

1.30

1.33

1.36

1.39

Euro/$ - Spot

63.5

64.5

65.5

66.567.5

68.5

69.5

70.5

71.5

72.5

EURO/INR -Spo t



Chana


Weekly Price Performance• After remaining firm during the preceding week, chana futures witnessed selling

pressure last week as demand was subdued at higher price levels. Also reportsof shipments from Australia & Canada led to short coverings.

Chana Sowing commenced in Maharashtra and Karnataka• Chana sowing commences in October in Maharashtra and Karnataka followed

by MP and then Rajasthan. In Maharashtra, 97000 ha area has been covered sofar which is only 7.1% of the targeted 12.32 lakh ha by the state dept.

Chana pulses area targeted at 7.9 mn tn after poor Kharif harvest• According to Farm minister, Kharif pulses output is seen at 5.26 mn tn , down

14.3% compared to last year. However, the ministry has targeted higher rabipulses output, particularly chana at 7.9 mn tn vs 7.5 mn tn in previous year.

CCEA approved supply of imported pulses at subsidized rates under PDS• The CCEA gave its approval for introducing subsidized distribution of 4 lakh tn

imported pulses through PDS with a subsidy of Rs.20/kg to below poverty. Thediscontinued scheme in June will be re-launched for 6 months till Mar 31,2013.

Australian Chana Production Up by 70.5%: ABARES• In Australia, chana production is likely to rise by 70.5% to 8.27 lakh tn from 4.85

lakh tn in previous years. A large chunk of chickpeas imports by India comesfrom Australia and Canada. Reports of higher import deals for shipment throughThus, higher imports may ease supplies in the domestic markets.

Outlook• Chana futures may trade with upward bias on account of festive season

demand. However, sharp upside may be capped as expectations oh highershipments of chickpeas may ease supplies in the coming weeks.

Weekly Strategy• Buy NCDEX Chana Nov between 4510-4560, SL -4350, Target - 4800 / 4840



Black Pepper

Source: Agriwatch & Reuters


Weekly Price Performance• Pepper opened the week on a negative note on expectations of pepper output

this season to around 60,000-63,000 tn. However, prices recovered towards theend of the week due to good festive demand. Export demand for Indian pepper isweak due to a huge parity. The Spot as well as the Futures settled marginallylower by 0.2% and 0.17% w-o-w.

• Indian Pepper is being offered at $8,850/tn (c&f) while Indonesia is offering itsAsta at $6,850/tn and Vietnam is offering 500GL at $7,000/tn.

• Average daily arrivals stood at 22 tn while offtakes stood at 22 tn last week .

A sharp fall in Pepper Exports• According to Spices Board of India, exports of pepper fell sharply from 2,266

tonnes in April 2011 to 1,200 tonnes in April 2012, by about 47%. In value terms itfell by only 18%, as the export prices were comparatively much higher.

Global updates• Pepper imports by U.S. the largest consumer of Pepper declined 14.8% in the first

2 months of the year to 8810 tn as compared to 10344 tn in the same period lastyear. Consumption in the US is expected to be lower by 22-24% this year.

• According to Vietnam General Statistics Office, exports of Black Pepper fromVietnam during January till September 2012 is reported at 80,433 mt. Globalpepper production in 2012 is expected to increase 7% to 3.20 lk tn as comparedto 2.98 lk tn in 2011. Brazil is expected to produce 22,000 tn this year.

Outlook• Pepper Futures may trade on a positive note. Festive season demand as well as

winter buying may support the prices in the coming days. Also, buying demandmay emerge from the crushing/grinding industry. However, expectations of better output coupled with low export demand for Indian pepper may cap sharpgains.

Weekly Strategy • Buy NCDEX Nov Pepper between 43000-43100, SL- 41900, Target- 44700/44950.

Source: Reuters & Angel Research.



Jeera

Source: Ministry of Agriculture, Gujarat.

Commodities Weekly Tracker

Weekly Price Performance• Jeera Futures continued to traded on a bullish note last week as exports were

active in the spot markets. Also, festive buying supported the prices. According tomarket sources, about 75% of the year’s export targets have already beenachieved. However, good rains in Gujarat capped sharp gains in the spot market.

• The Spot as well as the Futures settled 2.89% and 3.51% higher w-o-w.

Higher exports to offset higher production• Output of Jeera in India this season (2012) is estimated around 40 lakh bags, a rise

of 37.9% as compared to 29 lakh bags in 2011 (55kgs each). However, the impactof higher supplies on the prices may be offset by expected increase in exports thisseason and thus, medium term fundamentals remain supportive for the upside.

Global supply concerns to boost Jeera exports• Exports of Jeera rose from 2,369 tn in April 2011 to 2,500 tn in April 2012. Target

for exports in 2012 have been set at 45,000 tn against 35,000 tn in 2011.• Due to fall in the production in Syria and Turkey, and the ongoing tensions in

Syria, exporters have been diverted to India. Syria and Turkey have stoppedshipments. Export enquiries may re-emerge at lower levels.

International Scenario• According to reports, production in Syria is reported around 17,000 tons while

production in Turkey is reported between 5000-7000 tons, lower by 20% andaround 50% respectively, raising supply concerns in the international markets.

• The ongoing civil war in Syria has disrupted exports from Syria.• Indian Jeera in the international market is being offered at $2,770/tn (c&f).

Outlook• Jeera is expected remain in the positive zone this week due to festive demand.

Active buying by exporters is also expected to boost the prices. However, goodcarryover stocks and rains in Gujarat may restrict sharp gains.

Weekly Levels• Buy NCDEX Nov Jeera between 14900-15000, SL-1420, Target 16030/16185.

Monday | October 22, 2012

0

1

1

2

2

3

3

P r o d u c t i o n

, i n L a k h

T o n n e s

Production of Jeera in India

Source: Reuters & Angel Research.



Soybean


Weekly price performance• NCDEX Soybean November contract settled 4.4% higher on account of bargain

buying at lower prices levels. Although arrivals have gathered pace , there arereports that farmers are not ready to sell their stocks at such low level.

• CBOT soybean have recovered from their lows and settled around 0.5% higher,showing signs of seasonal rebound as harvesting in US complete almost 85% as onSunday.

Arrivals gathered pace• New soybean crop in MP are reported at 400000 bags last week. While in

Maharashtra and Rajasthan other two major growing states, arrivals are reportedat around 170000 bags and 100000 bags respectively.

•

Soybean follows seasonality pattern, wherein prices decline with start toharvesting in Sept & bottom out in mid October when harvesting reaches peak.

Soybean output for 2012-13 season up by 2.7% - Farm minister• A 3.7% increase in soybean acreage and good rains in MP, major soybean

producing state may lead to higher output next season. Farm minister has peggedoutput at 126.2 lk tn for 2012-13 season.

Brazilian Soy crop at record- CONAB• US soybean harvest is 85% complete as on Sunday and thus farmers selling have

slowed down, supporting the firm market sentiments. However south Americanhigher plantings is weighing on the prices. Argentina’s 2012/13 soybean harvestseen at 55-58 million tons, if weather conditions are conducive. Brazilian Soybeanoutput should be between 80 mn and 82.8 mn tn as yields return to normal.

Outlook• Going by the seasonality pattern, Soybean prices bottom during mid October

when harvesting reaches its peak and starts rising gradually with declining arrivalpressure. Also recovery in the international markets may support the upside.

Strategy• Buy NCDEX Soybean Nov between 3210-3260, SL -3060, Target - 3490 / 3520



Refine Soy Oil and Crude Palm Oil


Weekly price performance• BMD CPO and CBOT soy oil remained under pressure on account of higher

Malaysian palm oil stocks. However, domestic CPO and ref soy oil recoveredmarginally last week taking cues from the firm domestic oilseeds markets.MCX CPO and NCDEX Ref soy oil settled higher by 2.05% and 2.04% w-o-wWhile BMD Palm oil and CBOT soy oil settled lower by 0.2% and 2% w-o-w.

Global Scenario• Exports of Malaysian palm oil products for Oct. 1-20 rose 14.1 percent to

1,058,844 tonnes from 928,110 tonnes shipped during Sept. 1-20.• Despite hopes for an improved exports trend, rising inventories which hit a

record high in September, remain worrying as palm oil output shows no signs

of slowing. Malaysia, the world's No.2 producer of palm oil, will scrap a taxfree export quota for the crude grade from 2013 in a bid to reduce feedstockprices for refiners who have lost market share to top supplier Indonesia.

Domestic Scenario • India has lifted a ban on edible oil exports in small branded consumer packs,

until Sep. 30, 2013.• India imported 111,163 tonnes of refined palm oil in September, an increase

of 39.9 percent from August (Source: Reuters).• Total vegetable oil imports in September were 993,912 tonnes, up from

897,018 tonnes in the previous month.• India's 2012/13 edible oil imports seen at record 10.31 mln tonnes, up 5.4 pct

on year an industry expert said in glob oil conference. India's 2012/13 palmoil imports seen at 8.1 mln tn vs. 7.5 mln tn yr earlier .

Strategy: Refine Soy Oil• Buy NCDEX Ref Soya Oil Nov between 645-650, SL -620, Target - 687 / 693

Strategy : Crude palm Oil (CPO)• Buy MCX CPO Nov between 425-430, SL -405, Target - 460 / 465



Kapas/Cotton

Commodities Weekly Tracker Monday| October 22, 2012

Weekly Price Performance• NCDEX Kapas futures extended the weekly gains and settled higher by 6.5% owing to

firm international market. Also, CCI has stated procuring its annual cotton stock for

2012-13 season. ICE Cotton futures also gained further and settled 7.7% higher w-o-w on the back of quality concerns of the upcoming cotton crop due to early harvest.

CAB Meet: Cotton output to decline by 5% in 2012-13 and Exports to dip• India's cotton crop in 2012-13 (Oct-Sep) is expected to fall 5% to 33.4 mln bales from

35.3 mln bales in the previous year, according to the Cotton Advisory Board.• A drastic fall in exports is expected to 7.0 mln bales in the 2012/13 marketing year

that began on Oct. 1 from 12.9 mln bales a year ago as China demand falls.

CCI begins its purchases for 2012-13 season•

State-run Cotton Corporation of India (CCI) has begun its annual cotton procurementdrive for the 2012-13 marketing season (Oct-Sep). In the 2011-12 marketing season,CCI procured 3.48 lh bales (of 170 kg each) from across the country. (Economic Times).

Cotton Quality Concerns raised fears of supply squeeze internationally• Concerns that cotton from the early harvest of fields in the southeastern United

States had high levels of "micronaire", or coarse fibers that could break during thespinning process at textile mills has raised supply fears in the international market.

USDA monthly supply demand report raised ending stocks estimates• In its October monthly crop report, the Agriculture Department of U.S. government

raised its global inventory forecast for the season to end-July 2013 by 3.4 percent toa record of 79.11 million 480-lb bales due to a combination of sharply higherproduction and reduced consumption ahead of demand drop from china .

Outlook• Cotton prices are expected to trade firm due to good domestic demand at lower

levels. As prices have declined considerable, CCI has begun its procurement. Inaddition, firm international market may also support the upside .

Strategy• Buy NCDEX KAPAS April'13 between 970-980, SL -915, Target - 1060 / 1075



Thank You!

Angel Commodities Broking Pvt. Ltd. Registered Office: G-1, Ackruti Trade Centre, Rd. No. 7, MIDC, Andheri (E), Mumbai - 400 093. Tel: (022) 3083 7700Corporate Office: 6th Floor, Ackruti Star, Central Road, MIDC, Andheri (E), Mumbai - 400 093. Tel: (022) 2921 2000MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX : Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302

Disclaimer: The information and opinions contained in the document have been compiled from sources believed to be reliable. The company does not warrant its accuracy, completeness and correctness.The document is not, and should not be construed as an offer to sell or solicitation to buy any commodities. This document may not be reproduced, distributed or published, in whole or in part, by anyrecipient hereof for any purpose without prior permission from “Angel Commodities Broking (P) Ltd”. Your feedback is apprecia ted on [email protected]


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Commodities Weekly Tracker -22nd October 2012

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Transcript of Commodities Weekly Tracker -22nd October 2012