Commodity Trading Tips for Wheat by Kedia Commodity

Ajay Kumar Kedia 30 July 2013

Wheat Wheat yesterday settled down -0.19% at 1565 tracking weak spot demand as persisting good rainfall activities are expected to boost India's wheat production this year. India's wheat production is expected to fall 92.46 mn tons from its previous estimates of 93.62 mn tons as a result of unfavourable weather conditions in key wheat growing areas of Haryana and Madhya Pradesh, as per government estimates. Rains in various parts of the country discouraged the normal course of trading and lower demand against sufficient availability continued to weigh on market fundamentals. Private exporters are not active as outlook for global wheat market remains bearish. With declining prices in Black Sea region and US, parity for Indian private exporters turned negative. Higher than expected projections on world wheat production also pressurize the commodity movement in the global market. Persisting good monsoon rains are expected to support wheat crop this year. A combined wheat production by Australia and Canada is expected to reach higher at 683.1 mn tons in the year that started from July 2, according to International Grains Council. Government of India decided to sale 10 mn tons of wheat and 500,000 tons of rice from government inventories in the open market. Wheat inventories in the country stood around 44 mn tons, more than double of the government's minimum requirement. Persisting good monsoon rainfall is expected to support higher crop output this year. Technically market is under long liquidation as market has witnessed fell in open interest by -2.21% to settled at 13250 while prices down -3 rupee, now Wheat is getting support at 1557 and below same could see a test of 1548 level, And resistance is now likely to be seen at 1573, a move above could see prices testing 1580.