Commodity Trading Tips for Ref. Soya oil by Kedia Commodity

Ajay Kumar Kedia 1 August 2013

Ref Soya Oil Ref. Soya Oil yesterday settled up 0.94% at 636.1 due to short covering and fresh buying support on lower levels. Moreover, persistent rains have spoiled soya crop particularly in low lying areas. On the international market, the weather points negative for row crop markets with cooler temperatures and scattered showers in the forecast this week. On the demand side, the cumulative shipment pace is at 97.5% of the USDA forecast vs. the 5 year average of 94%. Cautious buying is seen in the spot market due to sufficient soybean stocks in the mandis of Madhya Pradesh and better oilseed sowing adding to the pressure to the market sentiments. This year, new soybean supply is expected reach market in September, a month advance, as result of early sowing. Soybean crop has been grown in an area of 10.31 mn hectares as of July 11, higher when compared to 5.45 mn hectares year-on-year basis, according to the data released by the Ministry of Agriculture. Global oil seed production is expected to be higher this year, according to the data released by the Oil world. Rise in the area under soybean crop in India and US would lead to higher production and ultimately increase world oil supplies which would be a bearish factor for the world market. At the Indore spot market in Madhya Pradesh, soyoil was steady at 662 rupees per 10 kgs. Technically market is under short covering as market has witnessed drop in open interest by -10.66% to settled at 43750 while prices up 5.95 rupee, now Ref. Soya oil is getting support at 631.5 and below same could see a test of 626.9 level, And resistance is now likely to be seen at 641.2, a move above could see prices testing 646.3.