Turmeric gets a decent export call, prices shoot.

Turmeric September contract moved up by 2% on NCDEX in the opening session due to export demand from mid-east Asian countries. It also got a boost from low carry forward stocks providing the uptrend momentum for the commodity.

Lower availability of turmeric till the fresh arrivals in the month of February next year will support the prices to remain firm in the short term (till August). Thus, near month contract will remain firm. Further, demand from the overseas buyers ahead of Ramzan is supporting the prices to remain firm.

There are expectations of farmers switching to this crop current year as the returns had been good last year. This is expected to improve the crop production prospects. Good weather conditions are likely to increase the sowing area for the commodity this year and help improve prospects for a better crop. Latest reports from Spice Board of India indicates the exports for the period April-June have fallen by 11% to 14,600 MT in 2010 from 16,440 MT in 2009.

In the medium to long term (September onwards) prices are likely to take cues from stocks of turmeric in India.

One can long Turmeric at 13200 with a stop loss of 13000 and target of 13500 according to Commodity Online research.

Turmeric opened at 13166 making an intraday low of 13002 during trading session and high of 13540. Total volume for the day is around 3480 lots and open interest is around 4830.

14 days RSI for turmeric is at 38 and it is increasing continuously since last 2 trading days due to lower level buying pressure. Resistance for Turmeric can be seen at 14000 and support level is at 12500.

Source : commodityonline.com