DAILY FUNDAMENTAL REPORT - AGRO Feb 23rd, 2012

DAILY FUNDAMENTAL REPORT - AGRO

Feb 23

, 2012

Market Overview:

Turmeric Improved fresh arrivals from the domestic market

led Spot and Futures prices to move towards south Prices

overlooked buying by the overseas buyers mainly influenced

the prices here.

Supported by a firming trend at spot market on rising

demand, pepper prices extended gains for the second straight

session by adding in futures trade. Trading sentiment further

strengthened on estimates of lower output this season. Rising

demand in the spot market and reports of lower output

mainly supported the prices here.

Chana futures expected to continue uptrend on lower supplies

amidst negligible carryover stocks. Lower output concerns

and firm domestic demand also supported the chana futures

to trade higher.

Jeera prices traded on positive note consecutive for second

session in unjha markets of India due to strong domestic

demands amid dull arrivals in the market from the producing

regions.

Watch

Market Watch

AGRO

CHANA

CHILLY

GUAR GUM

GUAR SEED

JEERA

PEPPER

R M SEED

SOYA BEAN

SOYA OIL

TURMURIC

WHEAT

CONTRACT

NCDEX March

NCDEX April

NCDEX March

NCDEX April

NCDEX March

OPEN

3547

5320

49300

15580

13838

32100

3604

2637

716.9

4670

1230

HIGH

3668

5420

49899

15690

14022

33375

3615

2642

719.8

4764

1233

LOW

3547

5270

48870

15300

13740

32000

3535

2585

712.1

4660

1227

3609

5420

49150

15432

13930

33375

3545

2595

713.5

4686

1230

CHG

188

-196

-67

126

1285

-48

-35.5

-1.65

-18

-2

% CHG

1.920

3.59

-0.40

-0.43

0.91

4.00

-1.34

-1.35

-0.23

-0.38

-0.16

63260

3740

4465

25900

12099

4534

213310

164450

129790

16125

7490

CHG

29850

1550

3040

9500

2751

1047

33170

24100

37680

2940

2760

%CHG

47.2

41.4

68.1

36.7

22.7

23.1

15.6

14.7

29.0

18.2

36.8

DAILY FUNDAMENTAL REPORT - AGRO

Feb 23

, 2012

PEPPER

Pepper futures gain as speculators short covering their position in the market hours. At the NCDEX (National

Commodity Derivative Exchange) pepper prices traded on positive note by Rs 1285 to Rs 33375 per quintal.

Fundamental Outlook:

Outlook:

The total production of pepper is likely to decline by almost 5000-6000 tons from the previous estimates of 43000

tons to 36000 tons due to early rainfall in major pepper growing regions which might reduce the pepper

productivity in the current year.

There were reports of 40 % and 20 % drop in pepper production in Kerala and Karnataka, respectively, while the

Vietnam Pepper Association reported of 30 per decline in the Vietnamese pepper crop.

Spot prices, in tandem with the futures market trend, coupled with strong buying interest amid limited supply,

shot up by Rs 800 to close at Rs 31,600 (ungarbled) and Rs 33,100 (MG 1) a quintal.

Fundamentals are positive in pepper. Supplies are very thin in the local market against good demand. The

demand-supply mismatch is likely to keep prices strong," said Hudani.

JEERA

Jeera futures gain on short covering by speculators amid lower arrival and strong spot demand mainly influenced the

prices here. At NCDEX jeera prices traded on negative note by Rs 126 at Rs.13930 per quintal.

Fundamental Outlook:

Demand is very poor in spot because traders are expecting further fall in prices because of hopes of higher

production. Around 1,500-2,000 bags of 60 kg each from the new crop are arriving daily at the Unjha market in

Gujarat.

The total arrivals of jeera stood at 4,000 bags. While demand was seen for around 5,800 bags. In Unjha, a key spot

market in Gujarat, jeera dropped -161.1 rupees to end at 14483.35 rupees per 100 kg.

Productivity of crops in both states however expected to fall due to adverse weather conditions as per reports. The

better crop expectations from Gujarat and Rajasthan could be hampered by reports of adverse weather conditions

in growing areas that could affect the productivity to some extent as per traders.

According to Spices Board of India, exports of Jeera during April 2011-Decmber 2011 stood at 31,500 tons as

compared to 21,750 tons in 2010-11, an increase of 45%.

DAILY FUNDAMENTAL REPORT - AGRO

Feb 23

, 2012

TURMERIC

NCDEX Turmeric futures traded on negative note amid higher arrival in the major mandis and the demand for the

yellow spice from other areas has decreased and traders received more orders.

Fundamental Outlook

Turmeric production for the year 2011-12 is projected at historical high of 82 lakh bags (1 bag= 70 kgs) compared to

69 lakh bags in 2010- 11. Erode is expected to produce 45 lakh bags of turmeric a rise of 29% as compared to

previous year.

Turmeric output in the southern state of Andhra Pradesh, India's top producer of the spice, is likely to rise 36

percent on year to 83,000 tons in 2012 due to an expansion in acreage, a state government official told.

The new crop is expected by mid-February. Traders feel present rates are very low even as expectations of higher

production continuously weighed on market sentiments. Higher production prospects and better stocks could

however keep pressure on prices as markets trade with high volatility.

The remaining 30 farmers objected to it and demanded cancellation of the sale or adequate space to place all

samples. Due to this, the market was closed and no sale was conducted in all four places then.

CHANA

Chana prices traded on positive note on strong Fundamentals in the last session. Strong demand amidst lower arrivals

supported the uptrend in the market. At the National Commodity and derivative Exchange, chana for delivery in

December increased by Rs 68 to Rs 3,609 per quintal

Fundamental Outlook

Dollar chana or chickpea has been sluggish on weak buying support in local and foreign markets in the past week

when prices declined by Rs 500-600 a quintal.

However, prices may rise on apprehension that last month's cold wave and frost may have damaged crops in parts

of Madhya Pradesh.

As per second advance estimates, pulses production is likely to drop by 1 million tons which is majorly contributed

by chana. Production estimates for 2011-12 crop is 10 lakh tons lower compared to last year.

Australia indicates a rise in production there by 15000 tons to 3.94 lakh tons in 2011-12. The other major

producers for Pulses namely Myanmar, Australia and Canada are likely to report a fall in Pulses production due to

adverse weather.

DAILY FUNDAMENTAL REPORT - AGRO

Feb 23

, 2012

SOYABEAN

Soyabean prices decline by Rs 35.50 to Rs 2,595 per quintal in future trading as traders short selling their position

amid weak demand and heavy arrivals from the physical market mainly supported the downtrend.

Fundamental Outlook

Chicago Board of Trade March soybeans fell 0.5 % to $12.64-1/2 a bushel by 1150 GMT , while March corn fell 0.4

percent $6.26-3/4 a bushel. Chicago March wheat suffered from spillover weakness, falling 0.5 %to $6.29-3/4 a

bushel.

The U.S. Department of Agriculture's outlook conference on is expected to include a forecast that the U.S. corn

acreage in 2012 will be the largest since 1944, which could mean a record crop. There is also speculation large new

soybean sales to China will encourage farmers to plant more beans.

Production costs are forecast to rise by 3.9%, or $12.5 billion, this year to a record $333.8 billion after rising by 12%

in 2011. As in 2011, 2012 production costs will set both nominal and inflation-adjusted records, ERS says.

Outside markets could add to the weakness as the dollar index is higher overnight. However, further weakness

should be limited by the reduced corn crops in South America that have been bullish for U.S. corn export prospects.

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