Weekly: Pulses Extend Fall On Dull Demand In Dals, Crop Arrivals & Cash Crunch

MUMBAI (Commoditiescontrol) – Major imported raw pulses, such as Tur, Urad, Masoor, Kabuli Chana, White/Green Pea extended losses for the second straight week. For the week ended 29th February, pulses witnessed pressure of crop arrivals, negligible buying amid liquidity crunch and dullness in demand and sale counter.

Only moong prices were steady, owing to limited buying by the millers and lower output.

However trade is of the view that demand deterioration in poultry products, that has reduced to nearly 50% in a fortnight, is likely to result in increased consumption of pulses, to compensate for protein requirements. The fear of rapidly spreading Corona virus has halved the consumption of poultry and meats for safety purpose.

Week Highlights

# Australia is likely to produce 3.38 lakh tonnes of Masoor (Lentils) during the year 2019-20 despite 21% decrease in acreage.
# Australia is likely to produce 2.81 lakh tonnes of Chana (chickpea) during the year 2019-20, despite a dip of 13.2% in planted area.
# White Pea in the international markets was weak due to growing doubts about prospective demand. The key issue facing markets is the rapidly spreading corona virus from to other parts of the world.
# Maharashtra Govt Will Give Bank Guarantee For Tur Procurement.
# In the State budget presented for the year 2020-21, Gujarat Government, has for the first time added Tur Dal in the list of grocery given under the PDS.
# Karnataka government is, meanwhile, struggling to arrange funds to fulfil the Chief Minister’s promise of increasing procurement of Tur from the prescribed 10 quintals per farmer to 20 quintals. The Centre has allowed the purchase of about 1.9 lakh tonnes and agreed to pay Rs 5,800 per quintal out of the MSP of Rs 6,100.

Burma Lemon Tur:

Tur Lemon variety of Burma-origin declined by Rs 50 at Rs 4,800/100Kg in Mumbai. Thin buying from mills in imported Tur is the major reason, as millers' preferred new domestic Tur. Availability of other origin Tur, such as Mozambique, Arusha and Malawi, is keeping a lid on Burma Tur.

Similarly, new domestic Tur in bilty trade at Akola traded weak, by Rs 50 at Rs 5,050-5,100/100Kg due to cautious buying support from the millers at higher rates and regular arrivals.

Meanwhile, limited demand and sale counter was witnessed in Tur dal at prevailing rates

Latur-origin new Phatka variety traded in the range of Rs 7,600-7,800/100kg, for spot. Gujarat-origin Wasat new Phatka variety at Rs 8,200-8,400/100Kg, Jalna-origin new Phatka variety at Rs 7,950-8,150 (Spot), Khamgaon-origin new phatka variety at Rs 7,400-7,500/100Kg and Solapur-origin new phatka variety at Rs 7,550-7,650/100Kg (Spot).

As per trade view, Tur prices are likely to get support due to low carryover stock and empty pipeline. The millers/traders have been trading hand-to-mouth due to liquidity crunch and Government policy. Meanwhile, the pace of Tur procurement by government from producing states has stepped up.Some buying from stockiest was reported. However local market players were active in purchasing new Tur for outstation traders and millers. Bulk buyers are yet to be seen.





Burma Urad:

Burma-Urad FAQ new/old variety continued to trade lower by Rs 350, each, at Rs 6,050/100Kg and Rs 5,900 respectively, at the Mumbai market.

Similarly In Chennai, Urad FAQ/SQ varieties moved southward, each by Rs 600-1000, to trade at Rs 6,100/100Kg and Rs 6,550-6,600, respectively in ready delivery, as per condition.

Reason behind the weakness lies in overseas supply at lower landing cost, thin offtake in Urad dal/gota, new domestic arrivals in Andhra Pradesh (Srikakulum/ Prakasham/ Krishna district).

Market is observing caution in ready trade at prevailing rates, tracking weak prices in forward deals in Chennai.

As per a Burma-based local trader, direct vessel carrying Urad cargo on 20th Feb has already set sail for India. While another direct vessel was expected to load Urad cargo for India on 28-29th February.

4-5 more direct vessels are expected to set sail for India in March.

Buyers from India have been active in purchasing Urad at lower rates against DGFT's allocated 139 tonnes of quota per miller, for a total of 2.5 lakh tonnes of Urad imports.

Meanwhile, Jaipur High Court postponed the hearing on pulses import restriction till March 6, 2020. The hearing is regarding non-issuance of Customs clearance to containers of urad, imported against the stay order.

Jaipur High Court has given an option to the importers/DGFT to take their case to the Supreme Court.DGFT has moved to Supreme Court for the same. Importers have filed cases in various High Courts for stay orders. DGFT has requested High Courts to transfer all these cases to Supreme Court, so the hearing can happen at one place. If Supreme Court admits case for hearing, it will mean more time for the decision to take place.

Meanwhile NAFED has been active in selling procured Urad in selected states.

Bikaner-origin branded Urad dal traded lower at Rs 8,500-8,700/100Kg for spot. Tiranga brand of Mumbai was priced at Rs 8,900/100Kg for Mumbai delivery, Parivar brand of Jalgaon was quoted at Rs 8,400/100Kg for spot.

Guntur-origin Urad gota traded at Rs 8,700/100kg in spot.

As per trade source, Urad prices will likely draw support after settlement in forward trade of current month, less supplies from Burma compare to given quota by government and lower output of kharif-rabi crop.



Chana Kantewala (Indore):

Chana prices traded steady to weak at Rs 4,025/100Kg in Indore amid thin purchases from local millers.

Higher output estimates and NAFED selling its old stock in selected states whilst the availability of new domestic Chana, is pressurising buyer sentiments.

Stable demand in Chana dal and besan from wholesale/retailer counters was reported due to cheaper rates compared to White Pea dal, besan. Ongoing marriage season and upcoming festival of holi has lead to steady demand, so far.

In Mumbai, Tanzania-origin Chana fell by Rs 25 to Rs 4,000. While Burma-origin chana was unchanged at Rs 3,800/100Kg.

Chana for March delivery on National Commodity and Derivatives Exchange (NCDEX), settled weak by 0.2 percent or Rs 6 lower at Rs 3,969/100kg. Earlier, in the day, the contract hovered in the range of 3,920 and 4,034 on Friday.

Open interest for NCDEX March contract increased to 17180 lots against 14780 lots.

Similarly, open interest for April contract was up to 25330 lots against 23500 lots.

Open interest of top 10 trading clients in the long side was 17690 MT, whereas the short position of top ten clients was 25280 MT. The net position of top 10 clients was net short by 7590 MT.

Chana stocks at NCDEX accredited warehouses was reported to be nil.

New Domestic chana dal of Pistol brand ruled weak at Rs 5,000 for Spot, Angel brand at Rs 5,250 for Spot, Samrat brand at Rs 5,250 for Spot. While, Chana besan traded flat at Rs 3,000/50Kg.

In Mumbai, Russia and Ethiopia-origin kabuli chana fell by Rs 50 each at Rs 3,900/100Kg and Rs 3,950, respectively, due to dull trade activity. Liquidity crunch owing to lesser interest shown by besan flour millers and weak trend in Chana prices are weighing on imported Kabuli Chana prices. While, Sudan and Burma Kabuli Chana remained unchanged, each, at Rs 4,000 and Rs 3,850 respectively.

Similarly, Kabuli chana of 40-42, 42-44 and 44-46 counts declined by Rs 50 each at Rs 6,350/100Kg, Rs 6,150 and Rs 6,000, respectively at Indore market amid slack local buying activity.

Dollar-variety Kabuli Chana slipped by Rs 200 at Rs 5,300-6,000/100Kg at Indore.

As per market view, millers' purchase follows their immediate requirement for crushing. Government is likely to raise its procurement target of Chana, at MSP, this year due to bumper crop. While arrival pressure of new domestic Chana will be witnessed after holi in Maharashtra, Madhya Pradesh and Rajasthan.

Chana prices will take cues from Government's stock liquidation; to make space for fresh procurement of new crop. Meanwhile, medium-term outlook for chana is bearish.

Market expects chana prices to collapse by 10% in a month's time. Thus, sell on rise is reckoned to be the best strategy for trade.





Imported Masoor (Mumbai):

Canada Masoor prices at Mumbai and Hajira port eased,each, by Rs 25 at Rs 4,700-4,725/100Kg and Rs 4,525, respectively. Similarly, Australia-origin Masoor in Mumbai fell by Rs 50-75 to Rs 4,700-4,725/100Kg.

On the other hand, Canada Masoor at Mundra port moved higher by Rs 50 to Rs 4,550-4,575 due to buy-back by the importer as the pulse sold at higher rates and delivery was not taken by buyers, yet.

Meanwhile, millers refrained from purchasing due to weak sentiments in other pulses. Selling pressure of old stock along with arrivals of new domestic Masoor is witnessed at selected markets of Madhya Pradesh.

Meanwhile demand in processed masoor from consumption centres was reported to be slack.

Canada Masoor dal Khopoli spot ruled down by Rs 50 at Rs 5,600/100Kg.

Breakbulk vessel from Canada carrying around 17000-18000 MT is expected to arrive soon at Kolkata port.

Market buzz is that, Masoor prices are likely to find support in near future due to cheaper pulses, limited stock of imported and domestic Masoor.

In forward business, Canada crimson variety Masoor new is being offered at $530 per ton in container on CNF basis JNPT for March/April shipment and Australia Nugget variety Masoor at $535 per ton.



Imported White Pea (Mumbai):

Canada-origin White Pea at Mundra port, extend fall by Rs 450 to Rs 5,650/100Kg, amid dull buying, weak trend in Chana and scattered arrival of White Pea in selected markets of Uttar Pradesh. Arrivals are likely to pick up pace after Holi.

Uttar Pradesh/Madhya Pradesh-origin white pea fell sharply at Rs 4,700/100Kg and Rs 4,600, respectively, at Kanpur market on dull local trade and new arrivals.

The reason behind this dullness lies in the shift of White pea's trading volume, as the preference stays with Chana/Kabuli Chana due to cheaper prices and easy availability.

Even consumption in Chana dal/besan was reported to be thin, despite lower prices.

The peas could not find support, despite tightness in ready stock.

However, Imports of yellow peas will be negligible this year as Government imposed the CIF value of Rs 200 per kg as Minimum Import Price for peas.

Meanwhile, Jaipur High Court postponed the hearing on pulses import restriction till March 6, 2020. The hearing is regarding non-issuance of Customs clearance to containers of White Pea imported against the stay order.

Even prices of White Pea dal traded weak following downtrend in raw White pea. Vatana dal traded lower by Rs 100 at Rs 6,700. Vatana besan of second quality priced at Rs 3,560/50 Kg.



Moong (Jaipur):

Moong prices traded nearly steady at Rs 7,800-8,200/100Kg, as per quality, at Jaipur market due to thin buying activity at higher rates.

Trade activity was reported to be limited, following weak sentiments in other pulses.

Moreover, Demand and sale counters in processed Moong was reported to be slow.

NAFED has been actively selling procured Moong in selected states.

At Naya bazaar market of Delhi, Rajasthan new kharif Moong traded at Rs 7,700-8,000/100Kg.

Ongoing arrivals of Moong was reported at Srikakulum district of Andhra Pradesh.

As per trade sources, prices of Moong are likely to stay rangebound on slow demand at higher rates and the arrival of summer crop from various states (Odisha, Bengal and Bihar).

Meanwhile, arrivals of new Moong has begun in Kenya, while in Tanzania/Mozambique the arrivals will commence from March.



Canada Green Pea (Mumbai):

Canada-origin Green pea dips at Rs 11000/100Kg at Mumbai, amid dull buying at higher rates. The pea followed weak sentiments in other pulses, despite tightness in ready stock.

However, customs is yet to issue clearance to containers, imported against the stay order.

This matter is already in Jaipur High Court, with hearing postponed on 6th March 2020.

Also, Government has imposed the CIF value of Rs 200 per kg as Minimum Import Price for peas.




(By Commoditiescontrol Bureau; +91-22-40015513)