Jeera gains due to good export demand and expectations of lower stocks

Jeera yesterday settled up by 1.26% at 47980 due to good export demand and expectations of lower stocks end of the current marketing year. Prices rose on crop worries grow due to unseasonal rains and hailstorms in Rajasthan, the major producing state. The market is expecting a lower yield and quality of this season, which has boosted the demand from domestic and export buyers. The jeera-growing regions in southern and north-western parts of Rajasthan in the districts of Alwar, Jaisalmer, Jaipur, Bikaner, Bhilwara, and Barmer have received a fresh spell of unseasonal rains in the past week, triggering concerns on the crop condition. Marginal traders are avoiding bulk buying in anticipation of the rise in the seasonal supply of jeera in Gujarat and Rajasthan. Below-normal supplies in the market supported firmness in prices. 

About 508 tonnes of jeera arrived on 6th June at major APMC mandis across India as compared to 653 tonnes the prior day. Tighter carryover stocks and lower production will push up the prices further. According to FISS forecasts, cumin demand is predicted to exceed 85 lakh bags this year, with a likely supply of 65 lakh bags. One bag holds 55kg. This will result in a demand-supply imbalance. Currently, at least 70% of the crop in Rajasthan and around 30% in Gujarat have yet to be harvested. Because of the rain in both states, the total yield will be reduced. The cumin crop was destroyed by two bouts of unseasonal rainfall during the harvest season. In comparison to the planned arrival of 70 lakh bags, the stock will be reduced to 60-65 lakh bags, with a carry-forward stock of 5 lakh bags from last year. In Unjha, a key spot market in Gujarat, jeera edged up by 369.4 Rupees to end at 47386.7 Rupees per 100 kg.

Technically market is under fresh buying as the market has witnessed a gain in open interest by 9.25% to settle at while prices are up 595 rupees, now Jeera is getting support at 47090 and below same could see a test of 46200 levels, and resistance is now likely to be seen at 48605, a move above could see prices testing 49230.

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