Commodity Trading Tips for Mustard Seed by KediaCommodity

Ajay Kumar Kedia 7 January 2014

Mustardseed Rmseed settled down -0.6% at 3458 despite extreme cold weather in key producing areas raised doubts over production. There are concerns over rapeseed yield due to cold weather. Extreme cold weather is not good for rapeseed crop. Rapeseed supplies are also coming down from last year's crop. Very dense fog has been observed in Rajasthan and such a situation is likely remain in next three days. With the area under mustard rising and weather favourable for the crop, prospects for mustard and its oil appear bearish. Mustard production this year is expected to be around 75 lakh tonnes against 68 lakh tonnes last year. As per the latest release from Ministry of agriculture, the sowing acreage of mustard seed was 68.86 lakh hectares as on 26 December 2013 as against 64.48 lakh hectares a year ago. This was mainly on account of higher area under the crop in major producing states such as Rajasthan and Madhya Pradesh (MP). Traders mentioned that below-average temperature in some parts of Rajasthan, MP and Uttar Pradesh will encourage the sowing of mustard seed over other short duration crops like coriander and jeera. Given the rise in sowing area and favourable crop report, any rally in both mustard and mustard oil appears unlikely in the coming days. According to sources, given rise in sowing area, production of mustard seeds this year is expected to be around 75 lakh tonnes against 68 lakh tonnes last year. Technically market is under fresh selling as market has witnessed gain in open interest by 25.44% to settled at 27960 while prices down -21 rupee, now Rmseed is getting support at 3437 and below same could see a test of 3416 level, And resistance is now likely to be seen at 3489, a move above could see prices testing 3520.