Epic Research Daily Agri Commodity Report Of 26 July 2018

The Cotton Advisory Board (CAB) estimates India's Cotton exports for this season (October 2017 to September 2018) to be 70 lakh bales, an increase of 20% over last year. From October, 2017 to April 2018, the total amount of cotton exported from India was 51.21 lakh bales. CAB has estimated that the Cotton production for the current Cotton season will be 370 lakh bales. Domestic prices of Cotton are ruling below the International Cotton prices. Domestic sale prices of the representative variety of S-6 cotton vis-à-vis international prices of its equivalent variety was lower by 7.18% as on July 14.

Earlier China use to import only Basmati Rice from India, amid trade war with US, China has agreed to import even non-Basmati Rice from 14 of the 19 registered Rice exporters from India. The clearance comes amid rising tension between the United States and China over trade tariff. China is looking for newer markets to boost its inventories. In an agreement signed on June 9, China agreed to import from India non-Basmati Rice. The shipments had to comply with the Chinese plant quarantine laws and regulations. India has to ensure that processing and storage houses of the Rice to be exported to China is free from pests, soil, seeds of weeds, paddy hull, loose bran and any of plant debris of Rice.

Indian Tea exporters are hoping to get a larger share of markets as the reval exporter Sri Lanka facing a three-pronged challenge. Export prices of the orthodox tea variant from Sri Lanka averaged $3.83 a kilo during January to June period this year, while prices for the Indian export of the same variant were $2.87 a kg. However, the cost of production of orthodox teas in Sri Lanka is nearly $5 a kg; compared with just $2.6 a kg in India. This makes Lankan production unviable. Indian producers also get tax incentives for export.

Economic News

Active monsoon conditions over the past 12 days has seen the countrywide rain deficit reduce to 2% from a high of 9%, but rainfall has continued to be poor in some major paddy-growing states, particularly Uttar Pradesh and Bihar, hitting the ongoing sowing of kharif crops. The Met office expects the monsoon to remain active in the rest of the month, which means monsoon in July is likely to be normal. The turnaround in the monsoon began around July 11. Since then, central India has gone from a slight rain deficit to an 18% surplus for the season. Rains have been good in south India as well, which currently has a season's surplus of 11%. Northwest India has seen average rainfall during this 12-day period, with the overall deficit being dented slightly from 10% to 6% (till July 23).

In a major relief to valueadded pepper exporters, the Kerala High Court issued an interim stay on the minimum import price (MIP) of Rs 500 per kg imposed on black pepper imports. The court observed that only the Central government had the power to issue notification framing or amending the Exim Policy under section 3 of the Foreign Trade (Development and Regulation) Act 1992. The director general of foreign trade (DGFT) had in March issued orders banning all consignments of pepper imported below MIP. The MIP was first introduced last December to protect domestic pepper growers who said rising imports were responsible for the sharp slump in pepper prices. But value-added pepper exporters, who import pepper for value addition and re-export the commodity, continued to bring in pepper by paying fines from December till March. DGFT issued a ban in March. “We will appeal against the stay. We have also met the commerce minister and apprised him of the situation,” said KK Vishwanath, co-ordinator of Consortium of Black Pepper Growers Organisation.

Trading Recommendations

SELL CORIANDER AUG BELOW 4950 TARGET 4930/4910/4890 SL 4980
SELL TURMERIC AUG BELOW 7190 TARGET 7160/7130/7100 SL 7230
SELL GUARGUM5 OCT BELOW 8750 TARGET 8710/8670/8630 SL 8800

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This release was published on openPR.