Epic Research Daily Agri Commodity Report Of 24 July 2018

The increase in Vietnam‟s yarn exports, particularly to the world‟s largest yarn importer - China, has made the country the world‟s fastestgrowing market for Cotton. This has spurred opportunities for greater Cotton exports from the US to the Southeast Asian nation, according to the Foreign Agricultural Service of the US department of agriculture (USDA). “US market share in Vietnam has grown to more than half from around a third in only 3 years. Burgeoning imports of US cotton are expected to underpin Vietnam‟s record 2018-19 consumption and to surpass projections for 2017-18 record imports and use,” said the latest USDA report „Cotton: World Markets and Trade‟.

Farmers of the two main Paddy growing states Bihar and Uttar Pradesh are facing drought-like situation due to shortage of rainfall. According to Agriculture Ministry data, compared to last year Rice has been sown in 68 per cent less area in Bihar while UP has witnessed 35 per cent less area sowing under Rice cultivation till date. Rain deficiency in Bihar is at 49 per cent whereas UP has recorded 48 per cent less rainfall in Eastern and Western parts. The IMD data shows 64 out of 72 districts in UP have so far recorded deficient or large deficient rainfall, the precipitation was at least 20 per cent less than the normal in 33 out of 38 districts in Bihar till date.

India will continue to maintain its supremacy in global black tea production in the next ten years, the Rome-based Food and Agricultural Organisation (FAO) said in its document on medium-term outlook for tea giving predictions up to 2027. FAO has projected India‟s black tea production to grow at 1.4 per cent per annum to 1,618 million kg in 2027 from 1,260 mkg in 2017. Similarly, India will continue to be the world‟s largest consumer of black tea with a growth of 2.2% per year. This will take the consumption level to 1,264 million kg in 2027 from 1,040 million kg in 2017.

Economic News

With the four-month rainy season almost half over, the rainfall deficiency in the eastern part of India, especially in Bihar and Jharkhand, has crossed the 40 per cent mark, while a quarter of the country has received "deficient" rainfall, the India Meteorological Department data shows. Bihar has recorded the highest monsoon deficiency of 48 per cent, while east Uttar Pradesh and Jharkhand have recorded 46 and 42 per cent respectively. The overall monsoon deficiency in the country has, however, dipped to three per cent. The overall deficiency in east and northeast India is 34 per cent, the highest in the country in comparison to the other meteorological divisions of the country. The Northwest India division, comprising Uttar Pradesh, Haryana, Punjab, Himachal Pradesh, Rajasthan and Jammu and Kashmir, has recorded 9 per cent of negative rainfall or less rainfall than the long period average.

Technically Cardamom market is under short covering as market has witnessed drop in open interest by 0.73% to settled at 136 while prices up 5.4 rupees. Now MCX Cardamom is getting support at 1125.4 and below same could see a test of 1119.2 level, And resistance is now likely to be seen at 1137.4, a move above could see prices testing 1143.2. Cardamom on MCX settled up 0.48% at 1131.5 as there are fears of damage to standing crops and delay in new crop supplies. Rains have also impacted the new crops and supplies from the fresh crop would get momentum by the third week of this month, though scattered supplies have begun to pour in some of the auction centres. Stockists did not make buying on hopes of higher output and early commencement of new crop supplies. Heavy monsoon rainfall that has caused damage to plantation thereby resulting in crop loss and downward revision of earlier made higher crop estimates. At the Vandanmedu auction centre, supplies were at 21 MTs; lower by 22 MTs that traded at avg.

Trading Recommendations

BUY CORIANDER AUG ABOVE 4920 TARGET 4940/4960/4980 SL 4890
BUY TURMERIC AUG ABOVE 7450 TARGET 7480/7510/7540 SL 7410
BUY GUARGUM5 OCT ABOVE 9300 TARGET 9340/9380/9420 SL 9250

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