NCDEX Chana under fresh buying; Support seen at 4238

Technically Chana market is under fresh buying as market has witnessed gain in open interest by 0.07% to settled at 40920 while prices up 5 rupees.

Now NCDEX Chana is getting support at 4238 and below same could see a test of 4214 level, And resistance is now likely to be seen at 4278, a move above could see prices testing 4294.

Chana on NCDEX settled up by 0.12% at 4261on short covering after prices dropped amid higher crop production for 3rd consecutive year and higher stocks with Government agencies. Chana acreage registered a fall of 10% on year to 9.6 million hectares due to lower monsoon rains in major producing centres.

Last year, the sowing stood at 10.66 million hectares, agriculture ministry data showed. During 2018, India received 9% below normal rains which impacted rabi sowing operations. Maharashtra reported biggest fall in chana sowing and acreage slipped to 1.29 million hectare from 1.95 million hectares a year ago due to lack of rains and moisture stress in key producing areas of the state.

Madhya Pradesh, Andhra Pradesh, Karnataka, Jharkhand also reported lower area, data showed. Chana stocks are diminishing due to higher domestic consumption and lower imports of chana due to 60% import duty since March 2018.

Chana exports from the country increased by 207% to 1.61 lt on year for Apr-Oct while imports down by 88% for same period. The National Agricultural Co-operative Marketing Federation of India Ltd (NAFED) continued to offload Chana in the physical markets.

NAFED sold 83,454 tons of gram in Andhra Pradesh and 42,049 tons in Telangana. Area under chana has decreased drastically in Maharashtra and Karnataka. Area under chana is lower by 11.32lakh ha so far on all India basis.

Trading Ideas:

–Chana trading range for the day is 4214-4294.
–Chana gained on short covering after prices dropped amid higher crop production for 3rd consecutive year and higher stocks with Government agencies.
–Chana acreage registered a fall of 10% on year to 9.6 million hectares due to lower monsoon rains in major producing centres.
–NCDEX accredited warehouses Chana stocks gained by 30 tonnes to 3650 tonnes.
–In Delhi spot market, chana dropped  by 10 Rupees to end at 4150 Rupees per 100 kgs.

Courtesy: Kedia Commodities