Chana dropped Rs 141 and settled at Rs 4703 per quintal due to a decline in the domestic demand at higher prices and increased supplies, while a pickup in rainfall across leading pulses-growing states also weighed on sentiment. Selling pressure is seen because demand is flat to weak but supplies are higher. Farmers completed sowing of kharif pulses on 9.82 million hectares by Sep. 6, down from 10.44 million hectares a year earlier. The kharif harvest is in completion stage. However, the late revival in rains could affect the quality and the yields of the standing crop. Overall sowing area is however down by ~12 lakh ha vs normal area as this time of the year. Rising imports from Myanmar supported prices as import costs rise from firm Dollar and lower International production. Apprehensions of fuel price hike may support rates. As per 4th Advanced Estimates. Pulses output is expected to fall to 17.21 mln tonnes in 2011-12 vs 18.24 mln tonnes in 2010-11. This is slightly higher than the 3rd Advanced Estimates of 17.02 mln tonnes. Chana production is expected to fall to 7.58 mln tonnes as compared to 8.22 mln tonnes last year. Reports of decline in Pulses production especially The total daily arrivals were hovering at the levels of around 40000 bags in the entire major mandies, up 10000 bags from the last day. In Delhi spot market, chana fell down by -97.8 rupee to end at 4740.65 rupee per 100 kgs. The volume was noted at 144670 lots. Support for chana is at 4629 below that could see a test of 4554. Resistance is now seen at 4811 above that could see a resistance of 4918.

Trading Ideas:

Chana  trading range for the day is 4554-4918.

Chana fell due to a decline in the domestic demand at higher prices and increased supplies

Selling pressure is seen because demand is flat to weak but supplies are higher.

NCDEX accredited warehouses chana stocks gained by 40 tonnes to 50749 tonnes.

In Delhi spot market, chana fell down by -97.8 rupee to end at 4740.65 rupee per 100 kgs.