Epic Research Daily Agri Commodity Report Of 28 August 2018

Multi Commodity Exchange of India Ltd (MCX) has signed a Memorandum of Understanding (MoU) with Indian Cotton Federation (ICF).The MoU with MCXNSE 1.18 % will enable ICF’s members to effectively participate in the exchange’s knowledge-sharing initiatives to understand the benefits, techniques and strategies of risk management using cotton futures contracts. The agreement is further designed to facilitate potential collaboration in areas such as organising awareness events for cotton value chain participants, including farmers across the southern belt; installation of price ticker board at textile parks; and joint representation to ministries and regulators for further development of the sector, among other activities.

Natural Rubber supply will be affected over the next two to three quarters due to the severe floods in Kerala, forcing tyre companies to resort to higher imports to meet the rising demand. Following this, domestic tyre production of south India-based tyre plants are also likely to get impacted in the near term.

Kharif crop planting reached 995.62 lakh hectares so far this season, down 1.28% as compared to the same period last year, data from the Agriculture ministry showed. Total area to be planted this kharif season is estimated at 1,058.10 lakh hectares. Coarse cereals, cotton, rice and pulses have seen a fall in acreage, while oilseeds and sugarcane have reported an increase. Monsoon data showed rains were 7% below normal since June 1. Still, India’s 91 major reservoirs held 28% more water than at this time last year, and 7% higher than the 10-year average at 101.286 billion cubic metres suggesting better water availability for crops after the monsoon ends. Officials say that in parts of the country where farmers will have to go for replanting of crop due to excess rain or deficit rain, farmers will now go for planting of sturdy short duration crops like pulses and coarse cereals

Economic News

Kharif crop planting has been done on 94% of the arable land, with last phase of planting picking up in rain-fed parts of the country boosted by fresh spells of rains across western, central and southern India in the past one week. However , the planting is still marginally lower than the level this time last year. Planting covering 995.62 lakh hectares so far this season is 1.28% less than a year earlier, data from the Agriculture ministry showed. Total area to be planted this kharif season is estimated at 1,058.10 lakh hectares. Coarse cereals, cotton, rice and pulses have seen a fall in acreage, while oilseeds and sugarcane have reported an increase. Monsoon data showed rains were 7% below normal since June 1. Still, India’s 91 major reservoirs held 28% more water than at this time last year, and 7% higher than the 10-year average at 101.286 billion cubic metres suggesting better water availability for crops after the monsoon ends.

Mentha Oil on MCX settled up 0.74% at 1721.7 due to bullish demand outlook from domestic market as well as exporters. Spot markets are also witnessing strong consumption demand amid restricted supplies. Bumper crop harvest has been discounted in the market and market is moving upwards on rising demand from end users. Arrivals in Sambhal stood at 400 drums compared to 350 drum a day ago while in Barabanki supplies rose to 500 drums from 450 drums a day earlier. According to preliminary estimates, mentha oil production in 2018-19 would be 40,000-45,000 ton against last year's production of 35,000 tons. There could be chances of crop damage to certain extend due to unfavourable weather condition. Besides, farmers are likely to hold back the stocks as the present prices are not remunerative for them. However, in recent years, the growth in production and consumption of synthetic mentha has influenced the demand for natural mentha.

Trading Recommendations

SELL CORIANDER SEP BELOW 4590 TARGET 4570/4550/4530 SL 4620
SELL TURMERIC SEP BELOW 6710 TARGET 6680/6650/6620 SL 6750
SELL GUARGUM5 OCT BELOW 8820 TARGET 8780/8740/8700 SL 8930

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This release was published on openPR.