Week Ahead: Masoor prices likely to fall further on consistent overseas supply

MUMBAI, January 28 (Commoditiescontrol): Prices of both imported and domestic Masoor continued to fall and were down by Rs 100-150/100Kg for the week ending January 28, 2023, as sellers remained active despite sluggish demand for Masoor dal. Furthermore, the consistent supply from the overseas market, Nafed actively selling imported Masoor, a higher global production estimate, and increased domestic sowing acreage added to the pressure on price.

As of now price trend in Masoor is weak. However, according to traders in Kolkata, the Masoor price received support in Kolkata due to export demand from Bangladesh for the Masoor chati (without shell) variety. The government of Bangladesh has issued a tender to purchase the commodity. The Australian Masoor chati variety is quoted at Rs 6,750-7,050/100 kg for Bangladesh delivery. Around 12000-15000 tonnes have already been exported. Whereas daily export demand is about 200 tonnes. However, Bangladesh traders/millers are finding it difficult to open LC for large quantities due to the dollar crisis in the country. They are opening LC for small quantities of 200-500 MT.

Meanwhile, the Canadian vessel, which is discharging Masoor, has completed the unloading of cargo at the Kolkata port, while the Australian vessel is still unloading the cargo. Another vessel carrying approximately 30,000 tonnes of Masoor from Australia is expected to arrive at the end of February.

Similarly, the availability of cheaper imported Masoor increased losses on domestic variety Masoor in Delhi (Madhya Pradesh line) and Indore by Rs 125-250/100Kg. Moreover, there was no trade witness in Masoor at Kanpur because millers were inactive as mills were closed for maintenance.

Masoor dal processed from Canada was quoted at Rs 7,100-7,300/100Kg, while Masoor dal processed from the domestic variety at Katni was quoted at Rs 6,700-7,200.

Rabi Masoor's acreage in India increased by 5.36% as of January 28th, 2023, compared to the same period last year, which equates to 18.49 Lakh Ha, up from 17.55 Lakh Ha in the previous year.




As per the technical chart - Mumbai Canada Masoor - More near-term weakness may lie ahead, we see next support at Rs 5,700. Click here

International Updates
For 2022-23, Canadian lentil exports for the August to November period totalled 8.4 lakh tons, 28% higher than the quantity exported during the same period in 2021-22. India imported the largest portion to date at 2 lakh tons. The leading export market, after India, is Turkey, followed by the United Arab Emirates.

Total Canadian lentil exports for 2022-23 are forecast to rise sharply to 23 lakh tons . The supply of lentils in Canada is estimated to be 5 lakh higher than last year as lower carry-in stocks partly offsetted the higher production. With sharply increase in supply and exports is expected to lead to lower carry-out stocks for the end of the 2022-23 crop year.

Canada masoor average price is forecast to fall by 18% from last year to $800/ton. Prices for No. 1 large green lentils are expected to maintain a premium of $330/ton above the price of No. 1 red lentils over the crop year, compared to a $325/ton premium in 2021-22.

US lentil production is estimated at 2.49 lakh tons, up 66% from the previous year. As a result, Canadian lentil exports to the US are forecast at 75 thousand tons for 2022-23, down from the previous year.

For 2023-24, seeded area in Canada is expected to fall marginally to 1.73 Mha. Production is forecast to rise by 15% to 26.5 lakh tons. With lower carry-in stocks, supply is expected to rise by only 2 lakh to 28 lakh tons. Exports are forecast to remain unchanged from 2022-23 at 23 lakh tons with marginally higher exportable supplies.

Carry-out stocks are expected to rise to 2.50 lakh tons.

Trend: Masoor prices may find some support at the current level as most of the negative news has been factored in prices. Further current spot market prices are lower than the landed cost for near-month (Jan-Feb)shipments. Moreover, demand for Ramjan from domestic markets and Bangladesh will support masoor prices. However upside should be limited due to NAFED selling, higher domestic and global production estimate and considerably very lower landed cost than the current spot price for the far month(March shipment). Moreover, new domestic crops are expected to begin next month & arrivals pressure is likely to increase after Holi, which is expected to bring down prices again.
(By Commoditiescontrol Bureau; +91-22-40015513)