Chana dropped Rs 126 and settled at Rs 3157 per quintal weighed by a decline in local demand amid estimates of higher production. Chana output is expected to be 8.49 million tonnes in 2012/13 as per the agriculture ministry's third advance estimate as against 7.70 million tonnes a year earlier. Market sources suggested that anticipation of timely and better monsoon in the current year prompted the stockiest selling in major producing states such as Rajasthan and Madhya Pradesh. The Delhi Chana market had witnessed a strong start to the week as the arrivals edged up compared to last few days. The average daily supplies were around 25-30 trucks during last week amid weak prices. This had been the case for last couple of weeks now as farmers did not show an active enthusiasm in bringing their produce to the mandies. However, the total arrivals in Delhi were 50 trucks today, witnessing yet another rise towards their seasonal highs. However, the prices are unlikely to gain much after falling to Rs 3330 per quintal on Saturday- their weakest in nearly one and half years. On a year ago basis as well, the commodity is down around 20%. The total output of Chana is likely to be 8.57 million tonnes in the current year. This marks a gain of 11.29% compared to the last year's production of 7.57 million tonnes. Rabi Pulses output is likely to be 12.09 million tonnes, up 9.61% on the year. Overall output in the current season is comparatively higher. In Delhi spot market, chana fell down by -54.4 rupee to end at 3245.6 rupee per 100 kgs. The volume was noted at 126280 lots. Support for chana is at 3108 below that could see a test of 3059. Resistance is now seen at 3250 above that could see a resistance of 3343.

Trading Ideas:

Chana trading range for the day is 3059-3343.

Chana ended lower weighed by a decline in local demand amid estimates of higher production.

Higher supply of the new crop from major chana producing states such as Madhya Pradesh, Rajasthan and Maharashtra pulling down prices.

NCDEX accredited warehouses chana stocks gained by 2820 tonnes to 113768 tonnes.

In Delhi spot market, chana fell down by -54.4 rupee to end at 3245.6 rupee per 100 kgs.