A positive tone in the global markets and optimistic demand outlook for the domestic cotton yarn market had supported the upside rally in MCX futures during the week ended recently. But Cocud was down for most of the week. The cheapening offers of cotton cake or cocud shall be lucrative for the processors as well as the stockists to go for fresh purchases. This should support the cocud futures going forward.
Technically the May contract remains strongly oversold and as long as the June contract of NCDEX holds above 2850, chances for an upward reversal shall be high. Cotton and Kapas on the other hand are expected to trade with an upward bias in forthcoming sessions, and we may see cotton 29 mm fiber prices surpassing the 47000 level soon.
The entire week had passed without providing any strong leads for the physical trade participant of Guar seed. The commodity seed has turned range-bound after breaking out from the 6000 barrier. The trading range of the May contract is between 6100 and 6400 since the beginning of April month. Unless guar gum exports pick up or there is clarity over the monsoon progress, it is quite likely that guar complex markets may trade in a similar price band. While guar gum prices are unlikely to sustain below Rs 6100/qtl this week, it is quite likely that guar gum will be able to attract buyers between Rs 18000-12000/quintal.
Spices futures were seen trading with a sideways trend for the entire week, but every fall was attractive for the buyers due to an optimistic business outlook. Similar price behavior is expected during this week. Dhaniya and Jeera appear relatively stronger than Turmeric from a monthly perspective. Prices are currently reasonably cheaper for stockists to go for fresh purchases. We expect a 3-5 percent appreciation in prices of Dhaniya, Jeera, and turmeric over the next 2-3 days.
Castor seed has been trading between 7000 and 7300 levels since the last few weeks. But the range for May castor seed was between 7100 and 7500 during the recently ended week. Buyers are getting abundant supplies from this season’s harvest these days due to which we have seen weakness in castor markets over the past 20-22 days. In context to the derivatives market, NCDEX castor May contract can re-test 7500 level this week as long as it closes above 7180-7210 support regions. In case the arrival pace is steady for next few weeks then the May castor of NCDEX will not sustain below the 7050 level.
Mentha oil May contract of MCX was down during the early part of the week ending April 29, but recovered later as spot demand began to improve. The production over last year is expected to drop due to lower prices during the 2020 and 2021 crop seasons. Technically the May contract will tend to pull upwards towards the 1100-1110 mark as long as it closes above the 1050/1055 support region. Farmers have planted less crop versus last year due to lower returns against their cost of cultivation.
