Monsoon hits maize

COMMODITY SPIKES

Both the maize futures and spot markets are likely to witness a bullish trend next week. Monsoon delay in parts of Karnataka has raised concerns among maize-based industry players. July futures, which fell marginally in the mid of last week, surged in the later part to close at Rs 778 against the previous week's close of Rs 769 a quintal on the National Commodity and Derivatives Exchange (NCDEX).

Marketmen said that the week ahead may see futures prices moving in the Rs 760-780 a quintal range. Average spot rates have risen to Rs 780 from Rs 725 in the last eight days.

According to sources, the new crop, which was expected by mid of September, may be delayed by a month till October.

Karnataka is the leading maize producing state in Kharif season, the season which accounts for 80 per cent of the total annual output. There are unconfirmed reports that farmers may shift to other crop, mainly jowar, owing to the high labour cost involved in maize production. If this comes true, it can become a significant factor in pushing the maize prices high.

Guarseed bearish

Prices of guarseed this week are expected to remain bearish. Last week the July futures dropped by over 5 per cent. Market sources said surplus stocks in Rajasthan would easily sustain demand for another two months. Spot rates in Bikaner and Jodhpur have fallen to as low as Rs 1,685 and Rs 1,800 a quintal respectively. "At these rates, market is witnessing a steady demand," said commodity analysts. Marketmen ruled out surge in rates despite good demand. According to them, future prices, which are at present ruling at the Rs 1,700 a quintal level, may drop even to Rs 1,670 this week. The range in which market is expected to oscillate is Rs 1,670-Rs 1,735 a quintal.

At present the overall stocks is 45-50 lakh bags (each of 100 kg), out of which around 25-30 lakh bags will result in carry-forward stocks. Lat week, the July guarseed futures on NCDEX closed at Rs 1,706 against the previous week's close of Rs 1,804 a quintal.