Chana settled up 0.18% at 2857 on late short covering after prices dropped on back of strong supplies in major mandies against limited offtake by millers.  Downside seen limited as domestic demand for the pea has improved due to upcoming wedding season. Chana arrivals in Delhi mandis were steady at 35 trucks compared to previous day. Prices are trading at the level which is way below the MSP of chana as fixed by the government. Chana was sown over an area of 10.21 million hectare compared to 9.5 million hectare a year ago thanks to normal monsoon and good soil moisture. Agriculture ministry has estimated chana output at record 9.79 million ton up from 8.83 million ton a year ago. The spot market cues suggests that higher supplies of around 50-60 thousand bags of new chana have been reported in the major producing states such as Madhya Pradesh, Maharashtra and Gujarat. Most of the chana processing companies prefer inferior quality of chana over average quality. Chana prices are ruling below MSP of Rs 3,100 per 100 kilogram in many markets of producing states on reports of record output. It is expected that Maharashtra will procure 20,000 tons, Haryana government 70,000 tons and Rajasthan to procure 200,000 tons of chana in the current marketing season at MSP levels. In Delhi spot market, chana gained  by 50 rupee to end at 2800 rupee per 100 kgs. Technically market is under fresh buying as market has witnessed gain in open interest by 0.53% to settled at 170310 while prices up 5 rupee, now Chana is getting support at 2835 and below same could see a test of 2813 level, And resistance is now likely to be seen at 2878, a move above could see prices testing 2899.

Trading Ideas:

Chana trading range for the day is 2813-2899.

Chana settled up on late short covering after prices dropped on back of strong supplies in major mandies against limited offtake by millers.

Downside seen limited as domestic demand for the pea has improved due to upcoming wedding season.

NCDEX accredited warehouses chana stocks gained by 150 tonnes to 119433 tonnes.

In Delhi spot market, chana gained  by 50 rupee to end at 2800 rupee per 100 kgs.