Mixed Trend In NCDEX Chana On Fresh Arrivals: April 23, 2012

Chana prices witnessed mixed trades throughout week owing to increase  in the fresh arrivals from the domestic mandi on one hand and reports of  possible rise in MSP of Kharif pulses.  

CACP has recommended 25% hike  in Kharif pulses i.e tur and urad. The recommended minimum support price is around 4,125 per quintal for urad and 4375 per quintal for moong.

Arrivals in Rajasthan has began since the beginning of April, however, the  pace is very slow on account of sharp drop in yields and thereby output  in Rajasthan, the second largest chana producing state. 

During the current season, despite of peak arrival period, prices are not  declining much as supplies are comparatively lower on the back of lower  output, while demand seems to be very strong. 

As per the NCDEX circular dated 11th April, Initial Margin(IM) of 10 % of  the value of contract or VaR based margin whichever is higher will be imposed on all contracts and yet-to-be-launched contracts of chana with effect from beginning of the day Thursday April 12, 2012.  

To curb excess volatility in prices, government has also imposed special  margin on chana and has cut position limits last week.

Demand Supply Scenario

The import of pulses is likely to cross three million tonnes this fiscal due to growing demand, country's apex body of pulses industry and trade said on Wednesday, 4th April. 

According to Second Advance estimates, pulses output is expected to fall  by 5.26% to 17.29 mln tonnes as compared to 18.24 mln tonnes in 2010- 11. Chana production is expected to decline by 6.8% to 7.66 mln tonnes  as compared to 8.22 million tonnes in the last year.  

As output is likely to decline, India's pulses imports in 2011-12 (Apr-Mar)  may rise nearly  10% from 2.75 mln tn in the previous year. India's consumption of pulses is on the rise with an annual growth of around 5%  but production is seen lower, which may lead to increase in imports this year.  

Around 74% of Indian chickpea imports come from Australia. However, despite increase in Australian Chickpea production in 2011-12,  lower carryover stocks and increasing domestic consumption may lead to  18% decline in chickpea exports from Australia in 2011-12.