Jeera Collapses On Waning Export Demand .

After witnessing a positive trend for almost a week, Jeera prices collapsed on Monday on profit booking on higher levels.

Jeera hit lower circuit (4%) on Monday. The movement was accompanied by the heavy volumes.

Earlier good export demand provided support to the prices.

Adverse reports on production from International markets kept trend firm in Indian markets.

Reports of adverse weather conditions in other major producers like Turkey and Syria have created apprehensions of lower output there and a possibility of delayed arrivals, originally scheduled from end-June onwards. Syrian pro-duction expected at 40000 tonnes and that in Turkey lower at 12-15000 tons.

Indian production expected at 28-30 lakh bags translating to more than 1.5 lakh tonnes. Higher acreage expected in Gujarat and Rajasthan due to good moisture content in the soil.

Better Indian quality and availability of stocks could shift the Gulf demand ahead of Ramzan towards India in the coming weeks that could support the falling rates.

Pepper

A narrow range bound trade is seen in the Pepper market with movement in both directions.

Exports are expected to rise at these lower levels that could support the prices further. But weak International market sentiments how-ever prevailed and exports too getting affected adversely, traders are not ruling out further weakness in the short term before exports rise again and short term high volatility is expected to continue till Fundamentals become clear.

Good export and domestic demand, lower stocks and a fall in production are likely to support the market sentiments in the near term. Traders expect that good demand and a firm trend in Vietnam could support the rates further. The exports are likely to pick up further and with stockists unwilling to sell at these levels, prices are likely to remain firm. Demand from North India remained moderately good.

Good demand from Gulf countries supporting the rates. Demand from China and West Asia also reported.

IPC has predicted 2011 crop to be lower by 2% at 309,952 MT. Carryforward stocks are expected to decline marginally to 94,582 MT vs 95,442 MT. Global exports have declined by 11% to 237,650 MT. Indian production expected to decline to 48,000 MT.

Vietnam is having low stocks as per reports. The production there too is expected to fall this year as per some estimates. Brazil and Indonesian crop expected to be lower. Low carryover stock in Brazil and Indonesia is likely to raise exports here in coming months.

Reports of farmers shifting to other more profitable crops have affected the production aspects for the crop in India.

Latest reports from Spice Board of India indicates the likely Pepper exports for the period April-March 2010-11 have fallen by 5% to 18,850 MT in 2010-11 from 19,750 MT in 2009-10 same period.

Turmeric

Turmeric market could not continue the gains seen during past few day and market fell on Monday due to weakness in other spices like Jeera and pepper.

In Physical markets too, trading activities are sideways.

But reports of rains in growing areas in Andhra Pradesh kept sentiments down. Low demand and reports of higher production and stocks in mandis are likely to pressurize the prices to some extent. There are expectations however of demand rising in coming weeks that could support the falling prices.

Sowing has started in the growing areas in Andhra Pradesh and the progress is reportedly satisfactory. Good Monsoon progress is also reportedly keeping the sowing activities proper. The area sown would however depend on the market rates and if the falling trend continues, traders expect the sowing area may fall as farmers may shift to other lucrative crops like cotton, soybean etc.

The present 2010-11 crop is expected higher at 65-70 lakh bags vs 48 lakh bags the earlier year.

Good stocks and increased selling pressure along with weak demand in the mandis have kept trend weak for the commodity over the last few weeks.

The sowing period is from June-August and harvesting begins in January.

Source : commodityonline.com