India Spices: Mixed; jeera down on margin levy, higher crop view

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India Spices: Mixed; down on margin levy, higher crop view

Tuesday, Mar 31

 

By Kavita Desai

 

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– Futures contracts of spices on domestic exchanges ended on a mixed note today. Jeera futures on the National and Derivatives Exchange ended lower as an additional surveillance margin of 5% was imposed on the contracts until Apr 23 and market participants expect a bigger crop, said.

 

Volume and open interest in jeera futures fell sharply due to lack of participation because of high margins and absence of cues from spot amid the ongoing lockdown, said Ajay Kedia, head of Kedia Comtrade.

 

Jeera production may rise 29% to 535,500 tn in 2019-20 (Oct-Sep) because of higher acreage in Rajasthan and Gujarat, the two largest producers, according to a survey by the Federation of Indian Spice Stakeholders.

 

Coriander futures rose today as concerns over a severe crunch in supply of the spice have deepened due to the lockdown, traders said. 

 

However, expectations of a bigger crop capped the rise in prices. Coriander output in India is likely to rise 55% to 383,060 tn in 2019-20 (Oct-Sep) because of sufficient water supply throughout the season and conducive weather, according to trade estimates. 

 

Turmeric futures closed marginally lower today in the absence of cues from key spot markets, which were shut due to the lockdown.

The nationwide lockdown has hit demand from bulk buyers, and forecast of a bigger crop this season has also kept prices under pressure, traders said.

 

Mentha oil futures on the Multi Commodity Exchange of India closed higher due to short covering after a sharp fall in prices in the past few sessions. The overall sentiment remains due to tepid demand for the spice oil from foreign and domestic buyers, analysts said.

 

Trade in spot markets has suffered due to the 21-day lockdown till Apr 14, said Ibadur Rehman, a spice oil trader based in Sambhal, Uttar Pradesh.

 

The April cardamom contract ended 4% higher as market participants bought the futures at a lower price after it hit an 11-month low of 1,835.5 rupees per kg on Friday, traders said.

 

Prices of chilli were unavailable as the benchmark market in Guntur, Andhra Pradesh, was shut. The state government has decided to suspend trading at the wholesale market during the lockdown.

 

Khammam, a major trading centre for chilli in Telangana, was also shut.

 

Following are prices of the most active contracts of spices at 1700 IST, compared with levels in the previous session:

 

Contract

Exchange

Unit

(kg)

Price

(rupees)

Change (rupees)

Coriander Apr

NCDEX

100

5,820 90

Jeera Apr

NCDEX

100

14,100 (-) 10

Turmeric Apr

NCDEX

100

5,802 (-) 28

Cardamom Apr

1

2,006.4 77.1

Mentha oil Apr

MCX

1

1,104.9 11.1

 

Following are the expected support and levels for contracts of spices for trade on Wednesday:

 

CONTRACT

SUPPORT

(rupees)

RESISTANCE

(rupees)

Coriander 

5,607 5,893

Jeera

13,962 14,277

Turmeric

5,797 5,887

Cardamom 

1,900 2,150

Mentha oil 

1,082.2 1,150

 

 

 

 

 

 

 

 

End

 

Edited by Charumathi Sankaran

 

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