WEEKLY AGRI REPORT-8 Sep To 13 Sep 2014

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Heavy selling was seen in chana futures on the account of recovery in kharif pulses sowing along with strong stock position in local mandies. The market sources suggested that favorable rainfall in Maharashtra and Madhya Pradesh will improve kharif crop conditions and also facilitate better sowing conditions for chana crop. The total sown area as on 29 August 2014, as per reports received from States, stands at 966.25 lakh hectare as compared to 998.01lakh hectare at this time last year, with sowing of Pulses standing at 95.40 lakh hectare as compared to 100.64 lakh hectare at this time last year. The futures prices were also discouraged by higher stocks in local mandies. The market sources suggested that total stocks of around 50 lakh tonnes of chana have been reported in local mandies and these stocks can easily meet the chana requirement in the current season.

Selling was seen in turmeric due to limited buying by traders in major producing states.However, the sowing of new crop is still a major concern in states like Andhra Pradesh and Tamilnadu due to delayed monsoon rainfall and poor price realization by cultivators. Similar trend is also observing in Maharashtra as not much sowing has been reported in Sangli. On the other side, stocks have depleted in local mandies with strong pace due to steady export demand.

Selling continued in jeera futures due to heavy stocks in local mandies along with limited buying by traders and exporters. The market sources suggested that heavy stocks of around 63 lakh bags in local mandies will encourage stockiest selling at every spurt in local mandies. The total stocks in local mandies were almost double of the previous year's level of 32 lakh bags due to record production in the current year. The prices also dampened by limited demand by traders and exporters in local mandies. The sources added that fresh supplies in international market have reduced the traders demand in local mandies.

Refined soya oil prices were trading lower on the account of steady supplies of imported edible in limited demand by millers. However, the prices remained supportive at lower levels due to weak sowing progress reported so far in the current year. The area under major kharif oilseed has declined by almost 7.20% as on 28th August 2014 due to poor sowing of groundnut and castorseed. The industry sources suggest that El Nino may impact the domestic kharif oilseeds product and raises the edible oil imports during 2014-15. As per the third advance estimates of Indian government, the total oilseeds production in 2013-14 is estimated at 32.41 million tonnes against 30.94 million tonnes due to higher sowing acreage.According to Soybean Processors Association of India, Indian soya meal exports during August are reported at 2778 MT, down significantly from 1.84 Lakh MT exported during August 2013. The major reason for weak exports was poor supply of soybean coupled with high price led to total disparity in international market. Soybean futures continued to decline, hovering near their lowest levels in a year, due to subdued export demand for soymeal.

Indian soybean futures fell to their lowest level in more than a year due to a drop in soymeal exports. Poor supplies and high prices of the animal feed drive traditional buyers away from the leading Asian supplier. The USDA Crop progress report showed 72% of the soybean crop is in good or excellent conditions, up by 2% week/week. Looking at the better crop conditions ratings it is anticipated that USDA might show an increase in the production figures in September WASDE report. However, according to a private agency, soybean yield is pegged at 47.6 bushels/acre as compared to 46 bushels/acre last month.

Castor seed to decline due to recovery in kharif sowing coupled with weak export demand of castor meal in local mandies. The latest data release by Ministry of Agriculture stated that castor seed kharif oilseeds have been sown only on 5.52 lakh hectares compared with 4.89 lakh hectares last year. This was mainly due to strong sowing in Gujarat. The prices will also dampened by weak export demand of castor meal in local mandies. The Solvent Extractors' Association of India overall export of oil meals during July 2014 is reported at 0.20 lakh tons compared to 0..25 lakh tons in April 2013 i.e. down 4 percent.

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