Jeera Futures Demand Rising

Chennai: Jeera (cumin) futures are likely to witness buying at every dip with demand seen picking up for the festive season and on export enquiry.

“We expect Rs 10,700 (a quintal) as a good support for November contract. We recommend buying December contract and selling November,” Kotak Commodity Services Ltd (KCSL) said in a weekly note.

While arrivals are around 2,500-3,000 bags daily in the Unjha mandi in Gujarat, spot rate was stable last week, where 6,000 bags were traded. The jeera market has witnessed long liquidation in the near month November contract, while a similar trend was being witnessed in November.

Volume of contracts has increased and the December contract could test the support of Rs 10,500 a quintal, KCSL said. During the weekend, jeera November contract closed at Rs 10,235, December at Rs 10,563 and January at Rs 10,816. In Unjha, spot jeera traded at Rs 11,061 a quintal.

A stock of about 25-lakh bags is likely to put pressure on chilli prices. With arrival being 60,000 bags and offtake around 20,000-25,000 bags, chilli futures could test the Rs 4,200-4,100 a quintal level on the downside. This could also form the support for the spice as it slipped below the first support level of Rs 4,400. Volume in all contracts has decreased and the November open interest positions reveal long liquidation. The trend in February shows short accumulation. November contract during the weekend closed at Rs 4,224 a quintal, while February ended at Rs 3,792 and March at Rs 3,607. Spot chilli in Guntur was quoted at Rs 4,376.

Turmeric

Turmeric prices are seen under pressure till the expiry of the November contract. Selling in turmeric is likely to be witnessed in the short-term, KSCL said, adding that the best strategy for investors would be to sell December contract at every rise.

Investors could sell December contract at Rs 2,075-2,100 a quintal before buying it back for squaring off at Rs 2,000-1,975 level. Stop loss could be activated at Rs 2,160. Volumes in all contracts have decreased and change in open interest for November contract indicates long liquidation.

Increase in the price and decreasing open interest for December contract indicates short covering, it said. During the weekend, November contract closed at Rs 1,975, while December and April ended at Rs 2,079 and Rs 2,363 respectively. Spot prices in Nizamabad were quoting at Rs 2,110.