Chana Extends Uptrend on Firm Demand

Chana Futures extended gains of the previous day and settled at the upper freeze of 4% on Thursday. Demand from the local buyers is providing support to the prices.

As per the latest release of the Rajasthan Agriculture department, 228200 hectares has been covered under Chana cultivation as on 18th October 2011. In Maharashtra area sown under Chana cultivation stands around 6100 hectares till 18th October 2011.

Government’s contingency plan for additional production of pulses in Rabi 2011-12 to overcome the losses of Kharif Pulses also supported the bearish market sentiments.

In order to bring down prices and increase its availability ahead of the sowing season, the Rajasthan government Wednesday 29th September 2011 set the stock limit on Chana separately from other pulses. The total pulses stock limits has been raised to 550 tn from current 500 tn for wholesalers. Chana will have separate stock limit of 250 tn and pulses other than Chana will have a limit of 300 tn.

In the contingency plan, Government has targeted to achieve an additional production of 2.78 million tonnes during the ensuing Rabi season through area expansion and productivity enhancement.

Additional allocation of Rs. 80 crore has been made for this purpose under NFSM- Pulses program.

Pulses Imports

Imports have declined dramatically in the current FY 2011-12 with India's state-owned trading agencies having contracted imports of only 121,660 tn pulses since the beginning of the current financial year till September 12, 2011 compared with 596,700 tn during the same period last year.

Imports have been weak because domestic pulses output in 2010-11 (Jul- Jun) was at an all time high of 18.09 mln tn, up 23percent from a year ago. Also, the Centre has abolished one of the reimbursement schemes for the state-owned importing agencies.

Sowing progress and Production

Indian government is targeting total pulses output of 17 mln tn in the current crop year that started July 2011, down marginally from last year's record production of 18.09 mln tn.

For Rabi Pulses, government has kept output target same around the previous year’s levels of 10.9 million tonnes. Chana is the main Rabi Pulse crop grown in India, sowing of which is done during October-December, and harvesting begins in January.

According to the first advance estimates, Kharif Pulses output for 2011- 12 season is down by 9.6% at 6.43 mt. Tur output estimates is up by 0.35% while moong & Urad is down by 21% & 16% respectively.

Kharif Pulses sowing is down by 9% as on 23rd September, 2011. 109.41 lakh ha has been covered against 120.3 lakh ha in the last year.