Expect Jeera prices to swing up in coming months: Ventura

Ventura Commodities has come out with its report on Jeera. As per the research firm, exports are expected to jump 29 per cent in 2011-12, and scale up to 19 per cent in the coming financial year that begins in April, according to trade and industry forecast.

Jeera sowing season in India starts on October to November and gets harvested on February to April, as the harvesting period is about to end ,jeera arrivals are going to drop in the market and prices could shoot up. As there was increase in prices during December-January was mainly due to the unfavorable weather conditions which were seen as a threat at the start of the sowing season. Post January favorable weather conditions and expectations of higher production due to a rise in acreage have led to a fall in the price. Production this year is expected to see a rise as key growing areas of Gujarat and Rajasthan have witnessed favorable weather condition post sowing. Carry forward stocks this year are expected to be higher by 10% as compared to last year. On the other hand, domestic consumption is expected to rise up to 1,68,000 tons this year as compared to 1,52,000 tons in the previous year. Exports are also expected to grow to 41,550 tons this year as lower prices will attract export demand.

Production this year is expected to see a rise as key growing areas of Gujarat and Rajasthan have witnessed favorable weather condition post sowing,we are expecting production to be 3.2-3.3 million bags, against 2.8 million bags reported last year,Gujarat’s jeera production is likely to be 1.2-1.3 million bags, while Rajasthan may contribute about 1 million bags. Carryover stocks of jeera is expected to be around 7-8 lakh bags as compared to 4-5 lakh bags last year. Syria and Turkey, would not be able to meet the international demand due to lower crop.

Domestic demand will be another key fact that will support the prices as the ongoing marriage season will push up the demand. The arrival pressure is expected to ease off in the near term as harvesting season in the major producing areas comes to an end. Farmers are currently holding back their stock as they expect prices to firm up as the harvest season ends. From the above mentioned factors we expect prices to shoot up in the coming months and test levels of 14000-14,500. Further, we expect exports demand to go up as the subdued prices will attract export demand. Exports are expected to jump 29 per cent in 2011-12, and scale up to 19 per cent in the coming financial year that begins in April, according to trade and industry forecast.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

To read the full report click on the attachment

Read More