Turmeric May Witness Selling Pressure

Chennai: Turmeric futures are likely to witness selling pressure with indications of long liquidation.

“Decrease in prices and increasing open interest for December contract is indicating long liquidation. Volume in all contracts has decreased,” said a note from Kotak Commodity Services Ltd (KCSL).

Arrivals and offtake declined marginally last week in Nizamabad in Andhra Pradesh but improved in Erode in Tamil Nadu. Weakness in the futures counter and stocks of 19.25 lakh bags in the spot market dampened prices. Buyers stayed on the sidelines anticipating further fall in prices despite the festival season.

Huge stock in mandis and NCDEX warehouses is a negative factor, KCSL said, adding that prices could be under pressure till expiry of November contracts. “We expect the market to maintain the selling pressure in the coming days,” it said. For investors, the strategy would be to sell on rise, particularly December contracts at Rs 2,075-2,100 for a target of Rs 2,000-1,975 and stop loss of Rs 2,160.

On Saturday, December contracts on NCDEX closed at Rs 2,067 a quintal, while November ended at Rs 1,990. Spot prices in Nizamabad were Rs 2,072 a quintal.

Chilli futures have broken the Rs 4,400 a quintal support and on the downside, support could be at Rs 4,200-4,100. Volume in all contracts has decreased and change in open interest for November indicated long liquidation, KCSL said, adding that arrival was around 60,000 bags, while offtake was around 20,000-25,000 bags.

On NCDEX, November contracts closed at Rs 4,380 a quintal. Spot prices in Guntur were Rs 4,450 a quintal.

Jeera

Jeera futures are expected the support level of Rs 10,500-10,700 for the December contract. Strategy for investors, according to KCSL, would be to sell November contract and buy December contract.

The jeera market is witnessing long liquidation in the near month contract as well as December contract. Volume decreased last week.

On NCDEX, November contract closed at Rs 10,515 a quintal, while December ended at Rs 10,850. Spot prices at Unjha were Rs 11,266.