MUMBAI(Commoditiescontrol) – Spot Cotton oil cake market continues to exhibit a subdued trend in the week ended May 6 due to poor demand from cattle feed manufacturer and it declined by Rs 40 at Rs 1,990/100kg in benchmark Kadi market.
With the start of the week, cotton oil cake prices declined due to negative demand from feed manufactures and stockiest who were major sellers, holding large inventory, however end of the week saw a shift in the demand when prices in the local markets dropped to 4 month lows of Rs 1960/100 kgs on May 4. There has been a drop of more than 15% over last 3 months which may induce feed manufactures to stock up for the long term however, they are covered for the near term.
Cottonseed oil cake May futures prices during the week on NCDEX has declined by nearly 0.86 percent to close at Rs 1,958/100kg taking cues from the physical markets and made a fresh 3 month low of Rs 1,894/100kg on May 4.
Ginners are liquidating their huge stock of cotton seed which can meet the long term demand of cotton oil cake and are creating space for the new crop cotton which is just 4 months away. This in turn will strengthen the current bearish trend.
Price of Cottonseed in Kadi are trading in the range of Rs 2,010-2,065/100kg down by Rs 55 from the previous week.
As we forcasted in a report on feb 4th 2017, stating rally in cotton oil cake since January will be against the market fundamentals and prices should correct in the long term, have been as per our expectation. (Full Report)
Next week cotton oil cake prices will trend downside on the bearish fundamentals which will be capped by the good buying support at lower levels.
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(By Commoditiescontrol Bureau; +91-22- 40015516)
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