Commodity report by Ways2Capital 23 june 2014

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COMMODITY WEEKLY REPORT

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NCDEX DAILY AND WEEKLY LEVELS

DALLY EXPIRY R4 R3 R2 R1 PP S1 S2 S3 S4

SYOREFIDR 18-JULY-14 713.20 704.50 695.80 690.10 686.20 681.20 677.60 668.50 659.90

SYBEANIDR 18-JULY-14 4293 4201 4109 4059 4017 3967 3925 3833 3741

RMSEED 18-JULY-14 3695 3636 3577 3546 3518 3487 3459 3400 3341

JEERAUNJHA 18-JULY-14 11311 11171 11031 10978 10890 10838 10751 10611 10471

DHANIYA 18-JULY-14 11241 10974 10707 10606 10440 10339 10173 9106 9639

CASTORSEED 18-JULY-14 4501 4444 4387 4355 4330 4298 4273 4216 4159

WEEKLY EXPIRY R4 R3 R2 R1 PP S1 S2 S3 S4

SYOREFIDR 18-JULY-14 730.10 714.20 698.40 691.20 682.30 675 666..20 650.80 634.10

SYBEANIDR 18-JULY-14 5107 4769 4431 4210 4093 3872 3755 3417 3079

RMSEED 18-JULY-14 3739 3666 3593 3551 3520 3477 3447 3374 3301

JEERAUNJHA 18-JULY-14 12108 11703 11298 11111 10890 10706 10488 10083 9675

DHANIYA 18-JULY-14 11718 11293 10868 10666 10443 10241 10018 9593 9168

CASTORSEED 18-JULY-14 4779 4620 4461 4398 4302 4239 4143 3984 3825

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MCX DAILY AND WEEKLY LEVELS

DALLY EXPIRY R4 R3 R2 R1 PP S1 S2 S3 S4

ALUMIN 30-JUN-14 116.55 114.95 113.35 112.45 111.75 110.85 110.15 108.55 106.95

COPPER 30-JUN-14 433 426 420 417 413 411 407 400 394

CRUDE 21-JULY- 6657 6585 6513 6487 6441 6415 6369 6297 6225

GOLD 5-AUG-14 28707 28355 28003 27835 27651 27483 27299 26947 26595

LEAD 30-JUN-14 132.60 130.85 129.10 128.10 127.35 126.35 125.60 123.85 122.10

NATURA 25-JUN-14 291 285 280 276 274 271 268 263 257

NICKEL 30-JUN-14 1205 1173 1142 1123 1110 1092 1079 1047 1015

SILVER 5-JUL-14 47040 46181 45322 44946 44463 44087 43604 42745 41886

ZINC 30-JUN-14 134.15 132.90 121.65 131.10 130.40 129.85 129.15 127.90 126.65

WEEKLY EXPIRY DATE

R4 R3 R2 R1 PP S1 S2 S3 S4

ALUMIN 30-JUN-14 121 118 114 113 111 109 107 103 100

COPPER 30-JUN-14 454 440 425 420 411 406 396 382 368

CRUDE 21-JULY- 6882 6727 6572 6516 6417 6361 6262 6107 5952

GOLD 5-AUG-14 31155 29885 28615 28141 27345 26871 26075 24805 23535

LEAD 30-JUN-14 138 134 130 128 126 124 122 118 114

NATURA 25-JUN-14 327 311 294 283 278 267 261 245 228

NICKEL 30-JUN-14 1371 1284 1198 1151 1111 1065 1024 938 851

SILVER 5-JUL-14 52947 49873 46799 45684 43725 42610 40651 37577 34503

ZINC 30-JUN-14 147 141 134 132 128 126 122 115 109




MCX - WEEKLY NEWS LETTERS

WORLD NEWS

United Kingdom (UK) Retail Sales declined by 0.5 percent in May from 1.0 percent rise in April.

US Unemployment Claims declined to 312,000 in the week ending 13th June 2014 from 318,000 in the preceding week.

US Philly Fed Manufacturing Index rose to 17.8 levels in June from 15.4 marks in May.

President Barack Obama said on Thursday he was sending up to 300 U.S. military advisers to Iraq but stressed the need for a political solution to the Iraqi crisis as government forces battled Sunni rebels for control of the country's biggest refinery. (Source: Reuters)

India's domestic fuel supplies will not be affected by fallout from the ongoing conflict in Iraq although state-run refiners have been asked to draw up a contingency plan, the oil ministry said in a statement on Thursday. (Source: Reuters)

Chinese iron ore traders are being starved of credit by banks reining in loan approvals and curbing letters of credit, industry sources and bankers say, as a clampdown on financing deals in the world's top consumer of commodities gathers force. (Source: Reuters)

PRECIOUS METALS A spot gold price increased by 3.3 percent in yesterday’s trading session as the Rise in Geopolitical tension in Iraq and ongoing dispute between Russia and Ukraine upsurge the demand for safe haven. Further, Federal Reserve slashed its forecast for economic growth and indicated that the Interest rate may remain lower for some time, which led to the weakness in Dollar. However, Strong economic data from US and US Federal Reserve decision to cut its monthly bond buying program by $10B to $35B capped sharp upside in the prices. Additionally weak physical demand from India and China kept prices under pressure.

In the Indian Markets, gold prices increased by 2.93 percent in yesterday trading session taking cues from Intl spot Gold prices. However, appreciation in the Indian Rupee prevented sharp upside in the prices. Gold prices touched an intraday High of 27653/10gms and closed at 276116/10gms

We expect spot gold prices to trade on the positive note as the Rise in Geopolitical tension in Iraq and ongoing dispute between Russia and Ukraine may upsurge the demand for safe haven. However, Strong economic data from US and US Federal Reserve decision to cut its monthly bond buying program by $10B to $35B may sharp upside in the prices. Profit booking at higher levels can be witnessed. In the Indian Markets depreciation in the Indian Rupee may support prices.




BASE METALSBase Metals on LME traded on positive note on the back of rise in risk appetite in the global markets coupled with weakness in DX. Further, strong economic data from US and US Federal Reserve committed to retain accommodate monetary policy supported prices to trade in green. In the Indian Markets copper prices rose by 0.38 percent taking cues from LME prices. However, appreciation in the Indian Rupee prevented sharp upside in the prices. MCX Copper touched an intra day high of 409.8/kg and closed at 408.95/kg

ENERGYCrude Oil:Crude Oil prices increased by 0.43 percent in yesterday’s trading session on the back of weakness in DX, rise in worries over oil disruption from Iraq due to geopolitical tension and ongoing dispute between Russia and Ukraine. Further, US Federal Reserve committed to retain accommodate monetary policy buoyed prices to trade in green. Additionally, strong economic data from US acted as a positive factor for the prices.

In the Indian Markets, crude oil price rose by 0.05 percent taking cues from NYMEX Crude oil prices. However, appreciation in the Indian Rupee prevented sharp upside in the prices. Crude oil prices touched an intraday high of 6410/bbl and closed at 6381/bbl.

We expect NYMEX crude oil prices to trade on positive note on the back of rise in worries over oil disruption from Iraq due to geopolitical tension and ongoing dispute between Russia and Ukraine. Further, US Federal Reserve committed to retain accommodate monetary policy which may support prices. However, Crude oil inventory fell less than expected and Federal Reserve slashed its forecast for economic growth which may prevent sharp rise in the prices.

Natural Gas:Natural Gas price decreased by 1.61 percent in yesterday’s trading session on the back of rise in inventory. Further, estimated rise in supply from EIA and forecast of cooler temperatures added downside pressure on the prices. However, weakness in Dollar cushioned sharp fall in the prices.

In the Indian Markets, a Natural gas price decreased by 1.21 percent taking cues from NYMEX Natural Gas prices. Further, appreciation in the Indian rupee supported prices. Natural Gas prices touched an intraday low of 275.4/mmbtu and closed at 277/ mmbtu.

We expect NYMEX Natural gas prices to trade on negative note as the forecast of cooler weather may reduce the demand for air conditioning. Further, increase in Natural gas inventory and forecast of rise in supply/record production may add downside pressure on the prices. In the Indian Markets depreciation in the Indian Rupee may cushion sharp fall in the prices.







NCDEX - WEEKLY NEWS LETTERS

Monsoon covers half of India in weak phase, slows sowing:The monsoon has covered half of India's landmass four days behind the usual schedule, failing to recover from a late start that has slowed sowing of summer crops in a country where half of the farmland still lacks irrigation. India's farming sector accounts for about 14 percent of its nearly $2 trillion economy. Inadequate rains can not only hurt farm output but also stoke inflation, a cause of major concern for the new government of Prime Minister Narendra Modi.

The annual rains arrived over the southern Kerala coast five days behind the normal June 1 start and then entered a lull, with poor rains over the interior parts of southern India. Rainfall was 45 percent below average for the week ended June 18, compared with 48 percent below average the previous week, weather office data showed on Thursday. "Rainfall has increased in some parts of the central region, but monsoon has continued to be weak," said a weather official who did not want to be named. (Source: Reuters)

FMC restricts futures trading in potato to check prices

Commodity markets regulator FMC has curbed futures trading in potato contracts for July, August and September in order to check prices by disallowing fresh positions and hiking deposit amount on buyers. The FMC has taken this decision in the backdrop of rising prices of potato and other essential commodities, which could be aggravated by the likelihood of a sub-normal monsoon. Currently, potato trading is active only on the commodity bourse MCX, while it is negligible on NCDEX. Following FMC's directive, MCX in a circular said it has disallowed fresh positions in July, August and September contracts of potato with effect from June 18. To restrict buyers, MCX has also hiked the margin money from 5 % to 30% of the value of the commodity. "Further, 25% special margin (cash) shall be imposed on long (buy) side for all contracts of potato with effect from June 23," the exchange circular said. (Source: Economic Times)

CHANA

Chana July futures traded on a mixed to negative note on Thursday on account of weak demand coupled with ample supplies and higher stocks on the exchange warehouses. Fears that the government may take action to curb inflation also added to the downside pressure and settled 0.28% lower. However, lower level demand coupled with forecast of below normal rains supported prices at lower levels.

The 3rdAdvance Estimates pegged total pulses output for 2013-14 at 19.6 mn tn, marginally lower from 19.8 mn tn earlier. There was a delay in the harvesting of the chana crop along with crop damage in Madhya Pradesh, Rajasthan, Maharashtra and Andhra Pradesh due to unseasonal




rainfall as well as hailstorms.

Supplies of Chana since past one year has been ample as the country reaped bumper Chana output in 2012-13 season. For 2013-14 too, the government in their third advance estimates has projected record output of at 9.9 mn tonnes in the Rabi season.

Outlook

Chana futures may trade on a mixed to negative note. Ample supplies, Rising stocks on the exchange warehouses, expectations of improvement in sowing of kharif pulses and higher output in 2013-14 may cap the upside and pressurize prices. However, a pickup in demand coupled with

forecast of below normal and lower pulses target for 2014-15 may

SOYABEAN :

Soybean July futures traded on a negative note on Thursday taking cues from start of sowing in MP, Maharashtra and Karnataka coupled with weak soy meal exports and settled 1.27% lower.

Soybean was in a bull rally since January on the back of supply crunch of this oilseed along with the bullish overseas markets. Concerns over below normal monsoon season, emergence of El-Nino and shortage of seeds for kharif 2014 sowing further fueled the already rising prices.

International Markets

CBOT Soybean traded on a positive note on Thursday on fears of crop damage to rains in the Mississippi river belt and settled 0.83% higher. Prices declined over the last few days on improved sowing, favorable weather, higher than expected end stocks and easing supply concerns.

Outlook

Soybean futures may continue to trade on a negative note. Starting of sowing on the new crop coupled with weak soy meal export demand Coupled may mount downside pressure on the prices. However, forecast of below normal rains along with tight supplies and lower availability of seeds for sowing may support prices at lower levels.

REFINED SOYA OIL

Refined soy oil July futures traded on a positive note on Thursday taking cues from positive CBOT soy oil prices while a strong Rupee capped sharp gains and settled 0.61% higher. Prices gained over the last few days on demand ahead of Ramadan. CBOT Soy oil gained 1.2% tracking bullish crude oil prices coupled with technical buying.

According to NOPA, Soy oil stocks in April increased to 2.058 bn lbs from 2.023 bn in March and forecast of 1.990 bn lbs. (Source: Reuters)




India meet 50-55 percent of its edible consumption through imports and thus rupee factor is a major determinant of edible oil prices.

Outlook

Soy oil futures may trade on a mixed to positive note. Positive overseas edible oil and crude oil prices may support prices. However, weak soybean prices and higher imports may cap sharp gains and pressurize prices at higher levels. Prices may also take cues from movement in the Rupee.

RM SEED

Mustard seed July futures traded on a positive note on Thursday on account of good mustard meal export demand and declining arrivals and settled 0.37% higher. However, weak oilseeds capped sharp gains. Mustard meal export increased 8.57% to 95,847 tn in May ’14 compared to 88,284 tn in May ’13. Sowing of mustard seed in 2013-14 stood at 7.13 mn ha as against 6.73 mn ha last year. Agriculture ministry in its 3rd advance estimates pegged 2013-14 mustard output at 7.8mn tn, down 2.9% compared to 8.03 mn tn in 2012-13.

Outlook

Mustard seed are expected to trade on a positive note. Mustard meal export demand, declining arrivals and lower output estimates and may support prices while weak soybean prices may cap the upside.




This Document has been prepared by Ways2Capital (A Division of High Brow Market Research Investment Advisory Pvt Ltd). The information, analysis and estimates contained herein are based on Ways2Capital Equity/Commodities Research assessment and have been obtained from sources believed to be reliable. This document is meant for the use of the intended recipient only. This document, at best, represents Ways2Capital Equity/Commodities Research opinion and is meant for general information only. Ways2Capital Equity/Commodities Research, its directors, officers or employees shall not in any way to be responsible for the contents stated herein. Ways2Capital Equity/Commodities Research expressly disclaims any and all liabilities that may arise from information, errors or omissions in this connection. This document is not to be considered as an offer to sell or a solicitation to buy any securities or commodities.

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Commodity report by Ways2Capital 23 june 2014

Investor Relations