Don’t go short on MCX copper
The sharp rise in the copper futures traded on the Multi Commodity Exchange from the April 15 low of ₹368.8/kg halted at ₹387 on Monday. Subsequently, the contract reversed lower from this high and is currently trading near ₹374.
The contract has been range-bound between ₹368 and ₹390 for more than three weeks. Within this range, it is declining after testing the upper end of the range. So there is a strong likelihood of the current down move to extend towards ₹370 and ₹368 in the coming days. An immediate break below ₹368 looks less likely now. The contract can reverse higher again from the ₹368-370 zone. The sideways range is expected to remain intact for some more time.
Short-term traders can stay out of the contract at the moment. Wait for a decline and enter fresh long position at ₹370. Stop-loss can be placed at ₹364 for the target of ₹380.
A break out on either side of ₹368-390 will decide the next leg of move for the contract.
A break below ₹368 will be bearish and pull the contract down to ₹360 and ₹350. On the other hand, a decisive break above ₹390 could add bullish momentum to the contract and take it higher to ₹400 and ₹410 there after.
Huge global stocks to affect sowing of kharif corn
Higher ending stock of corn globally will reduce returns for the Indian corn growers thereby hurting sowing prospects in the kharif season in 2015, experts maintained.
Global oversupply of corn has brought down global corn prices by about 27 per cent since April 2014 and is also affecting the domestic prices and exports.
According to the US Department of Agriculture (USDA) data, the ending stocks for 2014-15 trade year is estimated to rise 10.3 per cent to 188.45 million tonnes as against 170.84 million tonnes at the end of last year.
The data reveals that the United States with rise of 15 million tonnes of ending stocks would contribute maximum to ending stocks globally.
“Higher ending stocks are an area of concern for domestic as well as international markets. The falling prices will impact sowing in India as well as other major exporting countries like US, Brazil and Ukraine,” said Raju Choksi, vice-president (Agri Commodities), Anil Nutrients Ltd a part of city-based Anil Group.
Choksi attributed the current firmness in the domestic corn prices to unseasonal rains in some of the growing regions in India. “We expect prices to soften once Rabi crop arrivals start from next month. The global situation is likely to put pressure going forward on Kharif sowing as growers are likely to avoid sowing a crop, which is already in abundant supply,” Choksi said.
Since last few years, demand for corn as animal-feed has risen in India as compared to demand for food, seed and industrial consumption.
“The Indian market is following world market as far as consumption pattern is concerned. However, the ratio of feed consumption globally is higher at around 80 per cent against 55 per cent in India. We expect this trend to continue as growers shift to corn for feed following lower oilmeal production,” Choksi added.
Steel demand likely to see 6% growth: PwC
India is expected to see a 6 per cent growth in its steel demand during 2015, while the global demand is likely to remain at 2 per cent, a report said today.
“Higher demand is likely to come from India, with forecast growth of 6 per cent in 2015 compared to 1.8 per cent in 2013,” PricewaterhouseCoopers (PwC) said in a report.
It further said: “overall, the world steel demand growth is expected to remain around 2 per cent in 2014 and 2015, down from 3.8 per cent in 2013.”
The report said a sluggish demand on the global front is likely to continue as demand from China, the world’s largest steel consumer, declined considerably.
“Recoveries in Europe, the US and Japan are not anticipated to be strong enough to offset the slowdown in China and a number of emerging economies,” it said.
The fall in raw materials prices and weaker demand for steel may cause some steel companies to take a hard look at their resource portfolios, it added.
Coal, Railway Ministries, Odisha Govt sign MoU to form new joint venture
The Coal Ministry, Railway Ministry and Government of Odisha signed a memorandum of understanding on Monday to form a joint venture which identify and execute railway line projects for evacuation of coal in the State.
Coal India will hold 64 per cent stake in the joint venture while the Indian Railways will hold 26 per cent and the Odisha Government will hold 10 per cent.
“Speedier execution of projects through an independent corporation is the way forward. This is purely profit making venture which will help Coal India produce more and sell more coal,” said Minister for State (Independent Charge) Power, Coal and New and Renewable Energy, Piyush Goyal.
Coal Secretary, Anil Swarup added that the basic structure of the MoU will be used for similar collaboration with other states. Another MoU with Jharkhand is expected to be signed shortly.
“The new joint ventures will undertake the projects through project specific special purpose vehicles,” he added.
This post was written by Atlantic Admin