2nd May Monthly Report On SPICES. May 2017

Transcription

1 2nd May 2017 Monthly Report On SPICES May 2017

2 CARDAMOM Forward curve of Cardamom futures Historic returns of Cardamom futures during month of May % 11% 16% -11% 4% May June July August September Source: MCX Closing as on 28th April Cardamom futures on MCX are trading near its yearly low of levels. In days to come, cardamom futures (June) may witness sell on rise & decline towards levels. Any short covering may face resistance near 1280 levels. Selling pressure to clear the old stocks ahead of the new season crop is continuously adding bearish sentiments & pressurizing prices. Good summer showers in Idukki district of Kerala, has raised the expectations of a good yiled crop this season. With good rains in the April month, the harvest season to set in by June this year. If the growing regions get good showers in the next two months, then it would be a good crop. Showers during Mar-Apr are expected to boost the yield of the standing cardamom crop, which in turn will improve the output in (Jul-Jun). Buyers were staying away from the market on the anticipation that the next crop is expected to hit the markets by mid-june. The production and export of cardamom, also known as the queen of spices, has been increasing over the past three years. In three years the production and exports have increased by 33.5 per cent and 30 per cent. The union government is implementing various schemes to meet the increasing demand of cardamom in the country. These include production of quality materials of cardamom in the growers field, replanting of old, senile and uneconomic gardens of cardamom 2

3 TURMERIC Forward curve of Turmeric futures Historic returns of Turmeric futures during month of May % % % -6% -3% -8% -7% -7% May June July August -2-16% Source: NCDEX Closing as on 28th April Turmeric futures on the national bourse are making fresh yearly low & presently at 2 year low. In days to come, turmeric futures (June) will possibly plunge further towards levels. A recovery can be seen till 6200 levels. Turmeric prices are decreasing in all the major spot markets. Buyers are hesitant to make any large commitments due to bearish outlook due to good crop against poor demand. The prices of the yellow spice on the spot as well on the futures market are making fresh yearly lows on expectations of a bumper harvest this season. Duggirala turmeric yard is purchasing third grade quality of turmeric produced by farmers at Rs 6,000 per quintal, based on the certificates given by the horticulture department officials. In Andhra Pradesh, out of 13 districts, farmers from 12 districts are bringing their stocks to Duggirala agriculture market yard as it is the biggest turmeric yard in the state. Only the turmeric farmers in Kadapa district are selling their stock in their district market yard. Marketing Federation of Andhra Pradesh (Markfed) has opened two turmeric purchase centres so that farmers could avoid distress sale of their produce and instead get the minimum support price. The Markfed purchase centres will remain open till June 7. A-grade turmeric is being purchased at Rs 6,500 per quintal and B-grade turmeric is being purchased for Rs 6,000 per quintal at these centres. Farmers in Erode urged the district administration to prevail upon the State Government to emulate Andhra Pradesh in procuring turmeric, to arrest falling prices. In Erode, at present, farmers are selling their produce for Rs.7000 per quintal that was Rs.2000 per quintal lesser compared to last year. The supply side fundamentals highlight that total output in country is expected to be around 7.5 million bags in , as compared to 6.8 million bags in When added to the carryover stocks of 3 million bags, the total supply may rise to 10.5 million bags. The domestic consumption is around million bags & this will leave a surplus of 3 million bags for the next season even after exports. As per the third advance estimate of Andhra Pradesh state agriculture department, turmeric production was estimated higher at 1.55 lakh tonnes compared with 1.21 lakh tonnes last year. 3

4 JEERA Forward curve of Jeera futures Historic returns of Jeera futures during month of May % % 6.14% % 1.99% -5.36% -2.29% % May June July August Source: NCDEX Closing as on 28th April Jeera futures on NCDEX are trading near to its yearly high of levels & little shy from its all time high of levels. In days to come, Jeera futures (June) is expected to take support near levels & trade higher to test levels. It is estimated that cumin seed crop would be around 55 lakh bags (55kg each) for against lakh bags a year ago. As per third advance estimates for 2016/17, production of Jeera in Gujarat revised down to 2.12 lt, down 4% from its 2nd estimates and almost 11% compared to last year production of 2.38 lt. On the demand side, exporters demand at present is slow due to volatility in prices and they are waiting it to stabilize so they can enter in market. Chinese buyers are active in the market and likely to buy in bulk quantity. Export demand in cumin seed is average, but likely to improve. As per the data released by the government, the exports increased by 32% to 1,01,188 tonnes during first ten month of the financial year 2016/17 (April-January). Last year, India exported about 76,663 tonnes during the same period. The export of cumin in 2016/17 is expected to be higher than the previous year. Cumin seed prices in the spot and futures are around lifetime high and actual buyers or consumers are unlikely to buy in big quantity as risk-reward ratio is not favorable. Upcountry buyers and masala powder manufacturers are buying as per their near term requirements. 4

5 CORIANDER Forward curve of Coriander futures Historic returns of Coriander May futures during month of 7, , , % 6, , , , , % 6, , , , May June July August - -2% -9% -12% Source: NCDEX Closing as on 28th April Coriander futures (June) is trading near its yearly low of 6511 levels. In days to come, more downfalls is expected in the counter & it can test 6250 levels, if breaks the long term support near 6450 levels and face resistance near 6950 levels. Coriander supply is good and farmers are interested to sell their produce after recent strength in prices. Coriander off take at present is not encouraging, but buyers are eyeing on Ramzan demand ahead from this month. Any sharp fall in prices from hereon unlikely as it may prompt farmers and stockists to hold their produce to sell at the lower level. The data indicates that major chunk of the crop of Rajasthan & Gujarat has been offloaded in the market. India turned out net importer of coriander during FY as Russian produce was very competitive. India imported record 41, metric tonnes of coriander during April 2016 to January 17 out of this 28, metric tonnes imported from Russia. Despite of good production last season in the country domestic buyers procured huge quantity from there. But since coriander prices this season has corrected and now seems to competitive in the world market, export demand is likely to improve and may support prices. Strong arrivals of coriander in the spot markets are also weighing on its prices. Farmers and stockists are liquidating their stocks as they are bearish in the commodity on long term due to higher stock in the country. The market participants are slightly positive in coriander and expect exports to rise FY after lackluster previous year. India s coriander exports may rise to 60,000 MT in (April-March) after India turned net importer in

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