Merrill Lynch Transfer Of Its 5% Stake In MCX - Aug 09 , 2008

NEW DELHI: Merrill Lynch is transferring half of its 5% stake in Multi Commodity Exchange (MCX) to a separate entity, Valley Energy. The US financial services giant had picked 5% in MCX for Rs 205 crore in September 2007. This was a pre-IPO placement for MCX, which filed its draft prospectus for public float in February this year.

The US financial services firm is now in the process of transferring half of its stake in MCX to a recently-formed subsidiary in Mauritius, Valley Energy, an affiliate of Merrill Lynch Holdings (Mauritius). Valley Energy will hold 2.5% in MCX as part of this transaction. Its holding will, however, come down to 2.25% after the proposed IPO.

It is learnt that Merrill Lynch has applied for FIPB’s green light before MCX proposed the IPO. This is because if the proposal for transfer of shares to Valley Energy is not cleared before the allotment of shares under the IPO, the US firm won’t be able to do so for another year as it would have to comply with the share ‘lock-in’ clause.

The transaction is seen as a result of norms set for foreign investment in Indian commodity exchanges. Earlier this year, the government had allowed foreign investment up to 49% in commodity exchanges, out of which FII investment would be 23%. The norms had the clause that no single entity would hold more than 5% in the commodity exchange.

Merrill Lynch had invested in MCX through the FDI route. After the transaction, the equity stake held by Valley Energy will also be treated as FDI.

As per Sebi guidelines, shareholders who hold shares in a company before its goes public cannot sell them for a year from the date of allotment of shares in the IPO. This basically means these ‘locked-in’ shares cannot be bought or sold for one year.

Government Announces Its New Policy For Low-Priced Wheat Sale- Aug 02 , 2008

NEW DELHI: The government will announce its new policy for low-priced wheat sale in the open market by August 15. A CoS meeting will prepare a blue-print for unveiling the new policy on Friday in New Delhi. About a fortnight back, the Union agriculture minister Sharad Pawar announced that the Centre plans to release 60 lakh tonnes of wheat in the open market to check prices.

The government is planning to allow access to reasonably-priced non-branded wheat which will, however, be more expensive than above poverty line (APL) and below poverty line (BPL) issue price of the PDS. That, in effect, could save the government a fat increase in food subsidy.

"With this announcement, speculators have been warned not to boost wheat prices through hoarding. The price of wheat has remained steady in the recent past," minstry sources maintained. Although wheat wholesale price has remained steady for some weeks now, it has refused to fall.

That is what appears to be bothering the government and pointing to the active involvement of speculators. The higher output and record procurement of wheat should have increased the comfort level of the government on steady wheat WSP.

However, the big procurement has triggered apprehensions about the availability of wheat in the open market. Retail price of wheat, particularly branded wheat, remains high, affect-ing consumers.

Wheat WSP currently rules in the Rs 1,080-1,100 per quintal range. In sourthern markets, the price is pegged higher at an average Rs 200 per quintal on account of transport and other charges.

The high output in the 2007-08 season is viewed as the key reason why wheat WSP is holding steady. Wholesale prices of wheat fell noticeably by Rs 15 a quintal in early June on account of reduced demand from roller flour mills.

Mentha Oil Futures On Wednesday - July 30 , 2008

NEW DELHI: Mentha oil futures on Wednesday rose 2.28 per cent in early trade on Wednesday on the domestic futures market on the back of fresh buying by traders after hitting the lower circuit on Tuesday.

Traders said emergence of buying on supply concerns helped mentha oil to recover part of Tuesday's losses.

All four running contracts - July, August, September and October - were back in positive territory with a gain of 2.28 per cent on the Multi Commodity Exchange.

Mentha for delivery in August contract rose the most with a gain of 2.28 per cent at Rs 709.40 per kg after rising to Rs 710 at 1030 hrs.

While, near-month July contract was trading 2.10 per cent higher at Rs 694 per kg after moving between Rs 698.80 and Rs 685 per kg at the outset.

Far-month September and October contracts were up by 1.95 and 1.99 per cent at Rs 717 and Rs 728 per kg respectively.

Govt Must To Curb Cotton Exports - July 29 , 2008

New Delhi: After having made registration mandatory for all cotton shipments, the Union Government is now conceiving quantitative limits on its exports. There is a proposal now to fix a quantitative ceiling of 80 lakh bales on exports of raw cotton for the current cotton year ending September 30. The proposal was apparently talked at a recent meeting of the Committee of Secretaries and it has been sent to the Agriculture Ministry for further comments.

The Agriculture Ministry is hoped to come out with its views before the Commerce Ministry can proceed further on the move. On July 24, the Government made it mandatory for all cotton exports to be registered with the Textile Commissioner before their shipment. In its notification, the Directorate General of Foreign Trade (DGFT) also said cotton consignments should be approved by Customs authorities only after checking that the contracts had been registered.

These restrictions have come within 20 days after the Government scrapped the 14 per cent import duty on raw cotton and withdrew 1 per cent export incentive to boost domestic supplies and soften domestic prices. Though the Cotton Advisory Board approximated exports at 65 lakh bales this season, the textile industry sees shipments around 100 lakh bales.

SC Asks UP Sugar Mills To Pay Rs 110/Qtl For Cane Within Three Weeks

New Delhi: The Supreme Court’s order on Thursday requiring sugar mills in Uttar Pradesh to pay growers of Rs 110 per quintal “within three weeks” for cane purchased during the 2007-08 season (October-September) would entail their making disbursements of over Rs 2,300 crore.

During the recent season, UP mills had procured cane from farmers, against which Rs 8,164.86 crore was payable at the rate of Rs 110 per quintal fixed by the Lucknow Bench of the Allahabad High Court on November 15, 2007.

However, as on May 12, the mills had paid only Rs 5,842.49 crore. That leaves arrears of Rs 2,322.37 crore, which will now have to be discharged within the next three weeks. Of the Rs 2,322.37 crore, private mills owe the bulk of Rs 1,681.95 crore, with cooperatives (Rs 389.35 crore) and State Government-owned mills (Rs 251.07) crore) accounting for the rest.

Separate orders

Some of the sugar companies, including Bajaj Hindusthan, had obtained separate orders from the Allahabad High Court (not the Lucknow Bench) requiring them to pay only the Centre’s statutory minimum price (SMP) of Rs 81.18 per quintal, linked to a base sugar recovery of nine per cent. This was below the flat Rs 110 per quintal rate fixed by the Lucknow Bench and also the State Advised Price (SAP) of Rs 125 per quintal that was earlier decided by the UP Government.

But the Supreme Court has now, in its latest order, directed the mills to pay the Rs 110 per quintal interim rate that was fixed by the Lucknow Bench. The apex court will review this order in July (when it reopens after the summer recess), by which time the Allahabad High Court is also expected to pronounce its final judgment on sugarcane pricing and the fixing of SAP by the State Government. The High Court, on May 9, reserved its judgment.

Dues by cos

The Supreme Court’s interim order, passed by a Bench headed by Justice Arijit Pasayat, would particularly affect Bajaj Hindusthan and the U.K. Modi Group, which have arrears to the tune of 35 per cent and 66 per cent respectively of their total payable amount.

Others with dues in excess of 20 per cent include Mawana Sugars (29 per cent), the K.K. Birla Group and DCM Shriram Industries (24 per cent each), Triveni Engineering and Dhampur Sugar (22 per cent each), Simbhaoli Sugars (21 per cent) and Uttam Sugar (20 per cent).

On the other hand, companies such as DCM Shriram Consolidated (four mills at Ajbapur, Rupapur, Hariyawan and Loni), Sir Shadi Lal Enterprises (two mills at Shamli and Unn) and Parle Biscuits (one unit at Parsendi) have discharged 95 per cent or more of their cane payments. Balrampur Chini’s arrears, too, are relatively low at 14 per cent.

India To Export Additional 4,124 Tonnes Of Raw Sugar

New Delhi: India will export 4,124 tons of raw sugar to European Union in addition to the 10,309 tons already exported to the bloc, out of free sale portion of 2007-08 season's production.

The government had allowed export of 10,309 tons of raw sugar in October 2007 through Delhi-based Indian Sugar Exim Corporation (ISEC). In a separate notification, the government has also allowed export of 10,000 tonnes of white sugar to the 27-nation bloc for July-June 2008-09. ISEC is the designated agency for the export of sugar to EU under preferential quota, it added.

Chilli Output May Miss Target, Prices Likely To Soar

New Delhi: The chilli production in the country is likely to miss not only the projected target of 12 lakh tons in 2007-08, but it could be below the last year's level as well, as untimely rain has damaged 20-25 per cent of the crop, sources in Spices Board said. Market analysts who have pegged the loss at 15-20 per cent due to the rain said below-than-expected output could send the prices soaring in near-term.

Govt Provides Financial Relief To Tea Growers

New Delhi: The Commerce Ministry on Thursday announced the price spectrum band for 2007 for rubber, coffee and tea to give financial relief to the growers when the prices of these commodities fall below a specified level under the Price Stabilisation Fund Scheme (PSFS).

The tea growers would be the main beneficiary as both coffee and rubber growers had a boom year in 2007.

For tea, the Price Spectrum Band, calculated on the basis of seen years’ moving average of international price for the commodity, shows that the annual average domestic price for tea was Rs 64.66 per kg during 2007 and it has been categorised as ‘normal year’.

The annual average domestic price for coffee Arabica during 2007was Rs 112.70 per kg and it has been categorised as ‘boom year’ for Arabica. The annual average domestic price for Robusta was Rs 75.76 per kg during 2007, and it has been categorised as ‘boom year’ for it.

The annual average domestic price for rubber was Rs 90.06 a kg during 2007, and it has been categorised as ‘boom year’. As no tobacco grower is enrolled under the scheme, price spectrum band for tobacco has not been fixed.

On the basis of price spectrum band in 2007, 15,289 tea growers would receive financial assistance of Rs 0.76 crore from the PSF Trust Fund during 2008-09, while the other two commercial crops viz., coffee and rubber growers would not get any relief as they come under ‘boom year’ categorisation.

Gold, Silver Decline On Lack Of Buying Support

New Delhi: Despite firm global trend, gold prices declined on the bullion market today following lack of buying interest and lost Rs 180 at Rs 13,110 per ten gram.

Trading activity fell due to off-marriage season besides some investors shifting their funds towards rising stock market.

The firming global trend, which normally set prices in domestic markets here, failed to impact the trading activity. The US Federal Reserve cut interest rate by 75 basic points last night to create liquidity and control housing subprime crisis.

Gold climbed by $8.66 to $990.90 an ounce in London. The metal reached a record $1,032.70 on March 17. Silver, rising 16 cents to $19.885 an ounce, failed to impact on the gold prices in domestic market here.

Marketmen said persistent selling by stockists during the off-marriage season mainly pulled down gold prices.

Standard gold and ornaments remained under selling pressure and lost further by Rs 180 each at Rs 13,110 and Rs 12,960 per ten grams respectively. Sovereign followed suit and lost Rs 100 at Rs 10,200 per piece of eight gram.
A similar weakening trend was extended in silver, as the metal for ready delivery dipped by Rs 300 to Rs 24,200 per kg and weekly-based delivery by Rs 90 at Rs 25,880 per kg. Silver coins traded lower by Rs 100 at Rs 27,000 for buying and Rs 27,100 for selling of 100 coins.

Subsidy On Sulphate Of Potash Likely For Tobacco Growers

New Delhi: The Department of Fertilisers is preparing a Cabinet note on providing subsidy to tobacco growers for sulphate of potash (SoP), involving a sum of Rs 1,200 crore a year, the Minister of State for Commerce, Jairam Ramesh, said on Tuesday in the Lok Sabha.

Responding to a calling attention motion moved by former Prime Minister H.D. Deve Gowda on the subject, the Minister said as murate of potash (MoP) was banned in tobacco cultivation due to its adverse effect on crop quality, farmers were using only SoP. With SoP prices increasing steeply in the 2008-09 season, the Commerce Ministry took up the subsidy issue with the Department of Fertilisers, which agreed to prepare a note for the Cabinet..

Ramesh defended the ceiling on tobacco cultivation, saying excess production in successive years had caused a glut, exacerbating the plight of growers and India as a signatory to Framework Convention on Tobacco Control (FCTC) under the World Health Organisation (WHO) had to cut down tobacco cultivation progressively.

He said as production continued to be high, the Government had to resort to levying penalty on excess crop produced. Though originally fixed at Re 1 per kg and normal service charges of 1 per cent, this has been hiked to Rs 2 per kg and 15 per cent service charge over the years.

No discrimination

He denied the charge that there was any discrimination in the levy of penalty between the growers of Karnataka and Andhra Pradesh. He also asserted that there was “no politics in the fixation of the crop size”. Ramesh said the penalty charge on excess crop would be reviewed in the next meeting of the Tobacco Board.

Ramesh said during 2007-08, the country exported $410 million of tobacco. He added that the crop grown in Karnataka was of premium variety and the State exported 62 per cent of its produce, while Andhra Pradesh exported 58 per cent.

Good demand

As tobacco crop from Zimbabwe has ceased and the US is phasing out tobacco production, the demand for Indian tobacco in the global market has increased, he said, adding that Karnataka’s premium tobacco had better prospects. Ramesh said that following the visit of the Prime Minister Dr. Manmohan Singh to China recently, China would take 10 million kg of Indian tobacco every year, after a break of 14 years. This would help tobacco exporters of India, he said.

The Minister said his department and the Tobacco Board would devise a special project to popularise the non-carcinogenic use of tobacco. He said efforts would be made to extract chemicals from tobacco to be used in pharmaceutical and nutraceutical purposes.

In his observations, Gowda said when the fertiliser subsidy for the next fiscal was pegged at Rs 90,000 crore, poor tobacco growers numbering some 60,000 in Karnataka should not be slapped a penalty of Rs 9 crore for excess production as the soil in particular districts, where the crop was grown, was suited only to tobacco cultivation.

India Has Conducive Environment For Gold Mining

New Delhi: Stating that India has a conducive environment for the mine and mineral sector, the Minister of State for Mines, T. Subbarami Reddy, called upon the World Gold Council to invest in the gold mining sector.

“The consumption of gold is at an all-time high in India. The Government has taken a constructive approach to fuel growth in the mining sector and is looking to open investment in gold mining,” he said, adding that the WGC should ask entrepreneurs to bring in technology to promote investment in the sector.

Speaking at the meeting, James Burton, Chief Executive, WGC, said, “We hope the policies in the sector will be favourable for it to flourish in India.”

The price factor

On the fluctuating gold prices, he said the drop in the dollar rate is a major contributing factor besides the US sub-prime crisis. He, however, declined to comment on whether the prices will stabilise.

Burton also noted that the WGC is looking to cross-list its New York-listed StreetTRACKS Gold Shares, a gold exchange-traded fund (ETF), in Japan and Hong Kong by September.

Sanjiv Batra, Chairman of MMTC, said the potential of gold mining is very good in India. However, foreign companies in the sector were seeking clear guidelines regarding leasing agreements. He also said the Government is also looking at s

Fertilizer Glut Likely By 2012

NEW DELHI: Farmers across the world will not face any shortage of fertilizers in four years’ time.

If a UN Food and Agriculture Organisation report is anything to go by, global fertilizer supply is expected to outstrip demand by 2011-12 and will support higher levels of food and bio-fuel production.

The supply of fertilizer — nitrogen, phosphate and potash nutrient — in the global market will be surplus at 241 million tonnes in 2011-12 compared with the demand of 216 million tonnes, according to the report ‘Current World Fertiliser Trends and Outlook to 2011-12’.

FAO fertilizer expert Jan Poulisse said high commodity prices experienced over recent years led to increased production and correspondingly to greater fertilizer use, leading to tight markets and higher fertiliser prices.

Gold Softens On Reduced Buying, Weak Global Cues

New Delhi: After moving upward for the last four days, gold prices today receded marginally by Rs 5 to Rs 12,210 per 10 gram in the bullion market here on reduced offtake. Run-up to Budget 2008-09

However, silver continued to rise on increased industrial offtake along with strong overseas advices.

Marketmen said fresh resistance in demand due to record high levels and report of a weak trend in global markets mainly pulled down gold prices.

Gold declined by $2.24 to $943.86 an ounce in London. Prices were up 4.6 per cent this week, heading for the biggest weekly advance since November 23.

Standard gold and ornaments lacked necessary buying support and shed Rs 5 each at Rs 12,210 and Rs 12,060 per 10 grams respectively. However, sovereign, remained in demand and advanced further by Rs 100 at Rs 9800 per piece of eight gram.

On the other side, silver ready maintained its rising trend on increased offtake by industrial units and added another Rs 100 to Rs 22,100 per kg, while weekly-based delivery gained Rs 10 at Rs 22,850 per kg.

Silver coins remained steady at Rs 26,200 for buying and Rs 26,300 for selling of 100 coins in limited deals.

Gold Glitters At Rs 12,215, Silver Reaches 27-Year High

New Delhi: After breaching the crucial 12,000 mark yesterday, gold prices surged further to set a new record of Rs 12,215 per 10 gram in the bullion market here today. Run-up to Budget 2008-09

A similar trend was also noticed in silver prices as it touched 27-year high.

Marketmen said there was no physical buying in gold prices at existing higher levels but surging trend in global markets as crude oil reaching dizzy heights raised the concerns of inflation and boosted the demand for gold.

The yellow metal reached to record at $949.20 last night on the New York Mercantile Exchange and silver gained to $17.94 an ounce, the highest since 1980, they added.

Standard gold and ornaments notched up further gain of Rs 175 each to Rs 12,215 and Rs 12,065 per 10 grams respectively. Sovereign followed suit and shot up to Rs 9,700 per piece of eight gram, a level never seen before.

In the silver section, silver ready rose further by Rs 160 at Rs 22,000 per kg on firming global trend and weekly-based delivery jumped up by Rs 400 at Rs 22,840 per kg.

Silver coins rose by Rs 100 at Rs 26,200 for buying and Rs 26,300 for selling of 100 coins.

Tyre Industry Worried Over Rubber Exports

New Delhi: The domestic tyre industry has expressed concern over the move of the Rubber Board to promote exports of natural rubber. This concern has been expressed on the heels of projections of a three per cent drop in rubber production by the end of current fiscal. Run-up to Budget 2008-09

The tyre industry, which consumes 55 per cent of the natural rubber produced in the country, is worried that the exports would affect the availability of natural rubber at a time when it is not able to meet domestic demand.

Expected growth

“Production of natural rubber in the fiscal 2007-08 is expected to go down by 3 per cent, while consumption would grow by 5 per cent. Of this, consumption by the tyre industry is expected to increase by 6.6 per cent and non-tyre consumption by 3 per cent. In such a scenario, we would like the Government to encourage domestic consumption as against exports,” said Rajiv Buddhiraja, Director-General, Automotive Tyre Manufacturers Association.

According to him, the Rubber Board, which has set a target to export 46,000 tonnes during the current fiscal, has so far exported 30,000 tonnes of natural rubber and plans to export 16,000 tonnes during February and March.

The lack of availability of natural rubber compels the tyre industry to import it at a custom duty of 20 per cent.

This is expected to impact the margins of the tyre industry as 42 per cent of the overall cost is owing to natural rubber prices.

“The duty on raw material at 20 per cent being higher than the import of tyres at 10 per cent is a huge concern. With the rubber growers resorting to exports, we would like the Government to allow the duty-free import of rubber,” said Buddhiraja.

Gold Prices Rebound On Fresh Buying

New Delhi: Gold prices recovered by Rs 120 to Rs 11,810 per 10 gram in the bullion market here today on renewed demand amid positive cues in the global market.

Standard gold and ornaments on fresh demand improved by Rs 120 each at Rs 11,810 and Rs 11,660 per 10 grams respectively. Sovereign also gained Rs 25 at Rs 9,475 per piece of eight gram.

In a similar fashion, silver ready attracted brisk buying activity and flared up by Rs 600 to Rs 21,700 per kg and silver weekly-based delivery by Rs 490 at Rs 22,240 per kg. Silver coins also rose by Rs 100 at Rs 26,000 for buying and Rs 26,100 for selling of 100 coins.

Marketmen said buying activity in gold picked up at existing lower levels, pushing the prices up. Retail customers and jewellery fabricators in anticipation of rates going up preferred to buy at the current levels, they said.

The precious metal had plunged by Rs 260 in the bullion market in the previous day's trading.

Marketmen added that demand for the ongoing marriage season also contributed to the gold's northward journey.


Reports of prices going up in the Asian markets also ruled in gold's favour.

The metal in Asia rose by $7.30 to $913.90 an ounce and silver by 0.7 per cent to $17.42 an ounce.

Wheat, Atta Prices Dip On Increased Supply

New Delhi: Wheat dara prices declined further by Rs 10 a quintal in the wholesale grain market here on Saturday due to selling pressure from stockists along with increased supply.

Prices of maida and sooji also moved down. However, other commodities, including rice remained static in scattered buying or selling.

Marketmen said slackness in buying from rolling flour mills, mainly pulled down wheat dara prices.

Increased supply from producing belts amid slackness in demand, brought down the price of rice too, they added.

Wheat dara dropped further by Rs 10 to settle at Rs 1,100-1,110 a quintal, while wheat mp deshi remained quiet at Rs 1,300-1,575 a quintal.

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Chakki atta delivery and rolling flour mills price also finished lower at Rs 1,105-1,110 and Rs 1,100-1,105 instead of Rs 1,110-1,115 and Rs 1,105-1,110 a 90 kg bags respectively.

Maida and sooji prices too shed from Rs 1,200-1,210 and Rs 1,210-1,230 at Rs 1,190-1,200 and Rs 1,200-1,210 a 90 kg bags respectively.

Minimum Export Price Of Non-Basmati May Be Hiked

New Delhi: In a move aimed at discouraging rice exports, the Centre plans to further raise the minimum export price (MEP) of non-basmati shipments. This comes even as the country’s rice production is said to have touched an all-time high of 94.08 million tonnes (mt), going by the Agriculture Ministry’s ‘second advance’ estimate for 2007-08 released on Thursday.

“There is a proposal to hike the MEP from the present $500 a tonne free-on-board (f.o.b.) level. The exact figure is to be decided, but it could even be in the $600-plus range,” highly placed sources told Business Line.

The Centre had originally banned all non-basmati rice exports with effect from October 9. However, following complaints from exporters, who represented that the ‘non-basmati’ category covered a whole gamut of premium varieties not procured for the public distribution system (PDS), the blanket ban was replaced by an MEP of $425 (Rs 17,000) a tonne f.o.b. from October 31. The latter was subsequently increased to $500 (Rs 20,000) a tonne effective from December 27.

Concern over availability

But with international prices shooting up, there is renewed official concern over exports undermining domestic rice availability. Since the start of the current calendar year, prices of 100 per cent Thai grade B rice have increased from $375 to over $450 a tonne f.o.b.

“The Government is particularly worried about exports of long-grain varieties such as PR-106, which are procured for the PDS and are currently being shipped out at $550-600 a tonne f.o.b. There is a market for Indian long-grain in countries such as Saudi Arabia, which has announced a subsidy of $250 a tonne on rice imports into the country,” the sources noted.

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According to them, since October, about 80,000 tonnes of PR-106 has been shipped out to Saudi Arabia and the figure could cross 200,000 tonnes by September. These are mainly taking place through the Kandla and Mundra ports. “With a $250 a tonne import subsidy, an MEP of $500 a tonne becomes meaningless. While Thai long-grain rice is selling cheaper at about $450 a tonne, there is a marked preference for Indian long-grain varieties in West Asia,” the sources added.

Premium varieties

But the problem in hiking the MEP further is that it could hit exports of ‘Ponni’, ‘Red Matta’ and other such premium non-basmati varieties that are not procured for the PDS. Further, these basically cater to niche overseas Indian markets in the US, West Asia, Malaysia and Singapore. ‘Ponni’ rice, for example, is currently going at $550-600 f.o.b.

“A fine balance will have to be struck between discouraging exports, while not hampering shipments of PDS non-compatible grain. But in an election year, the Government’s worries over inflation and domestic availability obviously override all other concerns. And neither does the market take the Agriculture Ministry’s claims of a record crop very seriously,” the sources pointed out.

Currently, basmati-grade varieties from India are quoting (per tonne cost & freight, West Asia) at $1,550 for traditional (CSR-30) par-boiled and $1,850-1,900 for traditional raw, while correspondingly ruling at $1,400-1,600 for Pusa Basmati-1 and Pusa-1121.

One-year-old aged raw Pusa-1121 is fetching up to $1,800 a tonne. Prices of Sharbati, too, are ruling between $850 and $950 a tonne, depending on whether the consignment is of par-boiled or raw.

Gold Falls On Weak Asian Trenda

New Delhi: Gold dimmed in the bullion market here today as the prices fell by Rs 75 at Rs 11,680 per 10 gram following softening of rates in Asian markets.

Marketmen said trading sentiment turned weak as retail customers and jewellery fabricators postponed their buying decision on expectations of prices coming down further.

In Singapore, the metal lost 98 cents to $902.60 an ounce.

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Standard gold and ornaments dipped by Rs 75 each at Rs 11,680 and Rs 11,530 per 10 grams respectively. However, sovereign managed to attract some buying from retailers and gained Rs 50 at Rs 9,450 per piece of eight gram, the highest level never seen before.

Silver followed gold as silver ready declined by Rs 50 at Rs 20,750 per kilo and silver weekly-based delivery by Rs 250 to Rs 21,300 per kilo. Silver coins were traded unchanged at Rs 25,600 for buying and Rs 25,700 for selling of 100 coins.

Costlier Manufactured Items Fuel Inflation Rate

New Delhi: Surging prices of some manufactured items and industrial fuels lifted the annual Wholesale Price Index-based inflation to 3.93 per cent for the week ended January 19.

This was higher than the previous week’s annual rise of 3.83 per cent, the Government data showed on Friday. The annual rate of inflation stood at 6.31 per cent during the corresponding week a year ago.

The Wholesale Price Index of all Commodities increased to 217.1 points against 216.7 points the previous week.

Primary Articles

On a disaggregated basis, the Primary Articles’ group index rose 0.3 per cent, with prices of maize up two per cent and wheat and arhar prices up one per cent each. The index for the Non-Food Articles group rose by 1.1 per cent due to higher prices of nigerseed and soyabean ( six per cent each), sunflower ( five per cent), groundnut seed ( two per cent) and rape and mustard seed, cotton seed, castor seed and copra ( one per cent each).

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The Fuel, Power, Light and Lubricants group index rose 0.1 per cent due to higher prices of furnace oil ( two per cent) and light diesel oil ( one per cent).

The Manufactured Products group index rose 0.1 per cent as the index for ‘Food Products’ group rose by 0.4 per cent due to higher prices of soyabean oil, imported edible oil, gingelly oil and cottonseed oil (three per cent each), khandsari (two per cent) and groundnut oil, ghee and sugar (one per cent each). However, the prices of gur (one per cent) declined.

Textiles

The index for Textiles group rose by 0.4 per cent due to higher prices of viscose filament yarn (four per cent), cotton yarn-cones (two per cent) and cotton yarn-hanks, viscose staple fibre and other cotton yarn (one per cent each). However, the prices of polyester staple fibre (four per cent) and hessian cloth and hessian and sacking bags (one per cent each) declined.

The index for Chemicals and Chemical Products group declined by 0.1 per cent for the previous week due to lower price of epoxy resins (15 per cent). The index for ‘Base Metals, Alloys and Metal Products’ group rose by 0.2 per cent due to higher prices of other iron steel (nine per cent), MS bars and rounds (seven per cent) and lead ingots, foundary pig iron, steel sheets, plates and strips and basic pig iron (1 per cent each). However, the prices of zinc ingots (three per cent) declined.

The final WPI for the week ended November 24 stood revised to 215.6 points, as compared to 215.4 points and annual rate of inflation based on final index, calculated on point to point basis, stood at 3.11 per cent as compared to 3.01 per cent points reported provisionally.