Chana Surges 11% This Week; Near Term Outlook Positive

MUMBAI (Commoditiescontrol) - Most of the pulses raw pulses traded with positive tone in the spot markets across the country supported by good demand with Chana among the major gainer in pulses complex due to short supply against robust demand.

Chana (Madhya Pradesh: Delhi) - Chana surged more than 11 percent this week ended Saturday at the benchmark Lawrence road market of Delhi on strong demand from millers against tight supply coupled with delay in supply from Australia due to adverse weather.

Stocks of chana in Rajasthan has almost dried up as supply at the Delhi market was negligible during the week, whereas the demand was mainly met through supply from Madhya Pradesh.

Demand in chana was strong during the week due to slow supply and strong demand as consumption of chana, chana dal and besan usually remains at the peak level around Diwali festival period.

Further the prices edged higher in the spot market on reports that chana from Australia is expected to be available only by November-end. According to trade sources shipment from the country is expected to hit Indian shores up to November 20 with 35,000 metric tonnes.

The lower availability till the festive season will support the prices. But as the demand will ease post the festivals and imports arrive, chana prices is expected to decline gradually. Market will then shift focus to the quantum of imports and the sowing progress. Sowing has begun in Bijapur, Gadag, and Gulbarga in Karnataka, in the Sagar region of Madhya Pradesh and Jalgaon and Amravati of Maharashtra. This is likely to gather pace towards in the coming times.

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Urad (Burma Urad SQ - Mumbai) - Urad after remained mostly flat during the week due to slow but steady buying from millers to meet festival demand. Demand from mills was mostly hand-to-mouth as supply of the commodity is excess. Further major buyers are sideline in the anticipation that prices would decline as supply after Diwali may pick up pace. Burma urad FAQ was last traded at Rs 7,500/100kg at the benchmark Mumbai market, during the week it traded within range of Rs 7,500-7,800/100kg.

According to traders South India based millers are buying premium quality urad due to empty pipeline as crop was lower last year and slow supply from Burma. Poor supply from Burma was mainly due producers reluctant to sell their produce at the lower rates.

Nafed as on October 20 procured 9,265 metric tonnes urad from various states for buffer stock. It has sourced 2,684 metric tonnes from Rajasthan, highest among states followed by 2,324 metric tonnes from Maharashtra.

Arrivals in Maharashtra are affected by heavy rains due to September-end rainfall and the crop in the state is also expected to be damaged. Almost 60-70% of the crop was harvested before the rains began. Hence the standing 30-40% of the crop has been affected by rains. As result of which market is witnessing arrivals of both good and inferior quality. Due to the rain damaged crop, the variation in prices between inferior and good quality has become very wide.

Urad prices in the near term may trade steady with negative bias due to good supply from producing states amid better production.

Matar (Canada-Mumbai) - Matar during the week recorded gain of 2.4 percent amid good demand due to demand shift from Chana, which has turned costlier in pulses complex and used as an alternative to chana. Consumption of matar is expected to rise in the coming months due to cheap alternatives for Chana. However major upside will be capped by record crop in Canada and continuous flow from other origins as well.

Moong (Jaipur) - Moong prices traded 2 percent higher this week as stockists demand lended support to the prices at the lower level followed by Nafed buying, which has sourced around 7,532 metric tonnes as on October 20 from various states for buffer stock. Though the procurement of the commodity by government agency is slow.

Domestic buyers stockists and millers are active and buying as per their requirements. Supply pace of moong from most producing states including Rajasthan is good. Moong price unlikely to rise sharply due to expectations of robust production this season followed by continuous flow from overseas market.

Production this year in the Kharif season is expected to be close to 12 lakh tonnes as against 7.5 lakh tonnes last year. Higher acreage and good yields have resulted in higher production in all the major states.

Moong price in the country is expected to remain on the lower side at least in the near term, however sharp fall is limited amid government support at minimum support price.

Tur (Lemon-Mumbai) - Tur lemon managed to end this week with gain of 2 percent after losing 6 percent a week ago due to some better buying by millers at the lower level due to rising demand from processed tur (tur dal) for festival consumption. However demand as a whole was restricted due to expectation of bumper crop and expectation of drop in prices after new crop supply.

Arrivals of new tur likely to begin in Haryana and Uttar Pradesh from mid of November. Aligarh, Chara, Kher, Khurja, Bulandshaher and Hathras are the belt of tur in Uttar Pradesh. Crop is expected to be bumper compared to last 7-8 years.

Millers are buying as per their demand as they don't want to be caught at the higher level as have incurred huge losses since last year amid huge volatility in prices. Further retailers and wholesalers as well were buying as per their requirements despite limited availability with them due to low crushing.

Tur prices is likely to decline in the coming weeks and upside will capped due to expectations of robust crop this season amid massive rise on acreage. Harvesting of the early sown tur could begin in November while bulk arrivals will gather pace in December and January.

Masoor (Kanpur) - Masoor this week edged higher by nearly 2 percent due to good consumption in northern region, which is major consumer of this pulses. Firm tone in other pulses during the week also helped prices to improve, however any further major upside is unlikely as Canada is likely to produce record crop this season. Masoor harvest in Canada has been almost completed and soon will be available in Indian markets.

(By Commoditiescontrol Bureau; +91-22-40015533)