Jeera prices may surge on dwindling supplies, good export demand but sowing progress may weigh on prices

1. Agri Update – Jeera (Cumin)
We
www.angelcommodities.com
Thursday, September 08, 2016
Jeera prices may surge on dwindling supplies, good
export demand but sowing progress may weigh on
prices
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2. Agri Update – Jeera (Cumin)
We
www.angelcommodities.com
Thursday, September 08, 2016
Price Performance
The jeera on the National Commodities and Derivative
Exchange (NCDEX) has been at higher levels this season
compared to last three years. In the current year (2016)
jeera price on NCDEX jumped by about 38 per cent from
its low levels in February. The prices have touched its
highest in July (₹19,810 per quintal) from its lower levels
of ₹13,145 in February. Currently, the prices are hovering
around ₹17,740 levels in September.
In 2016, jeera prices have been in uptrend until July in
spot and futures market due to good demand from the
stockists and improving exports. Traders and stockists
have received higher domestic demand for jeera due to
good quality production this year after two years of lower
production and quality issues on bad weather during
harvest months.
The exports of Jeera increased compared to last year
during peak arrivals seasons of March, April and May
support the prices at higher levels. Moreover, the stock
positions in the NCDEX warehouse were at lower levels
compare to last year. According to the stock data shown in
15000
16000
17000
18000
19000
20000
21000
2-May-16
9-May-16
16-May-16
23-May-16
30-May-16
6-Jun-16
13-Jun-16
20-Jun-16
27-Jun-16
4-Jul-16
11-Jul-16
18-Jul-16
25-Jul-16
1-Aug-16
8-Aug-16
15-Aug-16
22-Aug-16
29-Aug-16
5-Sep-16
Source: Ncdex
Jeera Futures Price (Rs per Quintal)
9550
11550
13550
15550
17550
19550
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Monthly Avg. Price of jeera for last 3 years- NCDEX
(Rs per Quintal)
Y 2014 Y 2015 Y 2016Source- NCDEX
Exchange website, the stocks were about 70 per cent lower
than last year average stocks of 15,000 tonnes in NCDEX
warehouses in Unjha and Jodhpur.
However, jeera prices started to correct in the second half
of July mainly due to reports of slowdown in exports due to
higher domestic prices. There is good demand from
Vietnam and UAE, which supported the prices, but higher
prices have limited the demand from other countries. The
progress of monsoon rains in the country also weighs on
jeera prices on expectation of higher jeera sowing during
next Rabi season.
On NCDEX, Jeera prices have declined by about 10.1 per
cent from July high. In the below chart, we can see the
prices of jeera correcting after Jul 2016.
Declining Market Arrivals
The arrival of jeera in the physical market is declining during
the last three months – June, July and August as per the
seasonal trend (as shown on below chart). The harvesting
for 2015-16 season started in March and arrivals peak
during March, April and May.
As per the Agmarknet data, the quantity of jeera arrivals in
the country reported lower by 30 per cent in first five
13000
14000
15000
16000
17000
18000
19000
20000
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Source: Reuters
Monthly Average Closing Price- Jeera (Rs/Quintal)-
6,000
16,000
26,000
36,000
46,000
56,000
66,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Monthly arrivals (tonnes) Jeera - 3years Average
Source: Agmarknet

3. Agri Update – Jeera (Cumin)
We
www.angelcommodities.com
Thursday, September 08, 2016
month of new financial year (April-August) at 69,675
tonnes compared to more than 1,00,000 tonnes same
period last year. The production in 2015-16 in Gujarat
forecasted at 2.38 lakh tonnes (lt), up by about 21 per cent
compared to previous year 2014-15.
The arrivals in the physical markets in the country are not
reflecting in the production estimates. That means, the
market participants are speculating that commodity
aggregators and stockists are still holding jeera in
anticipating higher prices during the winter months.
Lower Stocks in NCDEX
In 2016, the stock position in the NCDEX warehouse lower
compared to deposits done during last year. The average
stock positions at NCDEX warehouse during last year
(2015) during April to August months was around 15, 000
tonnes while in 2016 the average stock held is only 4,300
tonnes. The lower deposits in Exchange reflecting good
physical demand coupled with higher exports for jeera in
the current marketing year compared to last year.
The spot price of Jeera during the month of June and July
in Unjha market was higher by more than 14 per cent
compare to last year prices.
0
20000
40000
60000
80000
100000
Apr May Jun Jul Aug Total
Comparision of arrivals of Jeera in 2016-17 and
2015-16
FY16-17 FY15-16Source: Agmarknet
0
5000
10000
15000
20000
25000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Stock position in NCDEX- 2015 Vs 2016 (Tonnes)
Y2015 Y2016Source: NCDEX
Exports
India exported jeera worth ₹68,891 lakh with total
quantity of 44,023 tonnes in the first three months (Apr-
Jun) of 2016-17. The export volume is higher by 71.7 per
cent compared to last year data for the same period.
Vietnam is the largest buyer of jeera accounting for
exports worth ₹29,727 lakh followed by United Arab
Emirates (UAE) and USA, which imported jeera worth
₹4,967 lakh and ₹4,637 lakh respectively.
According Department of commerce data, in June,
country exports about 9,859 tonnes of jeera, down by 52
per cent, compared to May (20,383 tonnes) but 39 per
cent higher year on year (7,064 tonnes).
In the first three months of new financial year, jeera
exports has achieved about 46% of last year’s export
volume due to good demand from Vietnam, UAE and USA.
Vietnam is the largest importer of Jeera, which imports
more than 41 per cent of total jeera exported by the
country. Vietnam is aggressively importing jeera this year
despite the higher prices. It has imported about 74.6 per
cent of total imports in three months compared to last
year’s import volume.
The export demand from UAE, USA, Bangladesh and Brazil
is steady in the current financial year as they also
imported 22.4 per cent of jeera by volume in April- June
2016.
In 2015-16, India exports about 94,352 tonnes of Jeera,
which is lower by 40 per cent lower compared to previous
year’s exports of 1.56 lakh tonnes. The top five-export
destination during last financial year was the Vietnam,
USA, UAE, Brazil and Egypt.
4,000
9,000
14,000
19,000
24,000
Jan Feb Mar Apr May Jun
Export comparision (tonnes ) - 2015 & 2016 -Jeera
Y2015 Y2016Source: Dept of Commerce

4. Agri Update – Jeera (Cumin)
We
www.angelcommodities.com
Thursday, September 08, 2016
Technical Levels
Commodity S2 S 1 CMP R 1 R2
Jeera Oct’16 16200 17000 17730 18100 18900
According to below chat, jeera exports will be steady in
coming months. Jeera exports during March to June
remains higher due to peak arrivals and lower prices in the
country.
Price Outlook
Since August, Jeera prices is correcting lower as physical
demand in domestic market is not picking up due to lower
than expected export orders. The jeera price has
improved occasionally on export enquiries but was
weighing down due to lack of trade confirmation. As per
the trade sources, the exports during July and August fell
by almost 50 per cent compared to last year exports
during the same period.
Jeera prices in the current financial year are at higher level
due to good domestic demand as production during last
two years was lower than the average production of the
country. Consequently, the stock levels in the country
were at lower levels when the arrivals start in March. As a
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Monthly Jeera Exports (tonnes) - 3 years Average
Source: Dept of Commerce, GOI
result, spot prices of jeera in domestic market are at
higher levels compared to 5 years of average prices as
shown in below chart.
Currently major part of jeera stocks are with the local
aggregators and stockists who are expecting further surge
in prices after the jeera crop from Turkey and Syria is used
up by the end of October. Until that time, the domestic
stocks will be diminishing and new season crop sowing
will commence.
During the next 3 months, the movement of prices will
depend solely on export and domestic demand. The fresh
crop will start arriving in the market only after March.
We expect, Jeera NCDEX for Oct’16 to touch ₹ 18,900 per
quintal as the traders and stockists try to hold on the
stocks on expectation of good export and domestic
demand during the lean season.
13000
14000
15000
16000
17000
18000
19000
20000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Jeera Spot Price - 2016 Vs 5 years Avg Price (Rs/Qtl)
Y 2015 Y 2016Source- NCDEX