Both the precious metals recovered to close with gains on-balance on the Mumbai bullion market last week. Silver, however, gained significant ground on firm overseas advice resulting in reduced supplies. The seasonal demand was moderate but below normal.
Gold edged up on the customs gold offer over the week which arrested the rising trend. Silver moved up crossing the Rs 6,900 mark. Overseas observers said the sentiment has changed for the better in view of reports that the question of revaluation of the German gold reserve has been rejected. Hence, it was learnt that the fears over the gold sale has been proved wrong.
Consequently, London gold prices have now moved up, crossing the $345 per troy ounce mark. Foreign silver advices were firm with the prices moving up to $4.76 per troy ounce. This had bullish impact on the values here as supplies at lower levels had drooped due to shrinking margins. The seasonal demand for silver was fairly good at upcountry centres and receipts had been absorbed leaving little stocks. However, it is felt that the demand season would not last after June 15 and hence stockists preferred to unload stocks at every rise. Unless values hardened fresh supplies would not be possible. Thus the advices from overseas would have to be reckoned with.
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Gold Standard opened at Rs 4,770, against the previous close of Rs 4,765 and despite sale by customs, values firmed to Rs 4,780 to end the week at the high of Rs 4,780 per 10 gms. The seasonal demand here was at a low ebb. The sentiment was hesitant as the season would end soon and depended solely on the rise in prices abroad. Gold 22 carat fluctuated between Rs 4,405 and Rs 4,420. Official gold biscuits after starting the week Rs 100 higher at Rs 55,800 eased to the low of Rs 55,700, rising to Rs 55,900 and finally closing at Rs 55,800.
Ready silver .999 fineness opened last week at Rs 6,880, against the previous close of Rs 6,875 and in early trading after narrow movements receded to a low of Rs 6,875 but at week end shot up to Rs 6,935 to close at Rs 6,840 per kg. Silver .916 fineness fluctuated between Rs 6,790 and Rs 6,835. Tenderable silver was down Rs 35 at Rs 6,845 at the week-end.
Oilseeds weekly: An easier trend was perceptible in castorseed futures on the Mumbai oilseeds market last week. Lack of fresh bull support coupled with selling pressure from spot-houses and exporters resulted in further erosion of the prices. However, reports from upcountry centres indicated that a prominent bull operator had started accumulating long position in Ahmedabad oilseeds market. Consequently, Ahmedabad contract has been ruling at about Rs 25 higher than in the city. The price fluctuation here followed the Ahmedabad pattern as bears started covering at lower levels.
In the spot section prices ruled as fresh export commitments for castor oil has been very poor with the Brazil offerings at reduced rates. New Brazil castorseed crop is expected to be fairly large. In edible oils, fluctuations have been reported for groundnut oil. In view of the end of the month consideration there was poor demand. New rabi crop arrivals have started in Saurashtra and the South, hence at least for the next six weeks, the rise in groundnut oil prices would be limited. Imported palmoleine and sunflower oil were available at cheaper rates and in plenty.
In the spot section, castorseed Madras small was placed at Rs 547 per 50 kg. Castor oil commercial was offered at Rs 248 per 10 kg. In edible oils, groundnut oil receded from the opening Rs 360 level to Rs 357 to end at Rs 355 per 10 kg on limited buying support and 75 tonnes per day supplies. Palmoleine dropped from Rs 278 to Rs 275 but recovered to be finally placed at Rs 276 per 10 kg. Sunflower imported oil was offered at Rs 256.
Grains weekly: In view of financial difficulties and very poor activity, prices ruled steady on the Mumbai grains market last week.
Wheat supplies continued to be of the inferior variety and traders were surprised as to where the quality Punjab wheat has been going.
Wheat and rice have been moving out of the country from the Gujarat and Punjab borders. The central government has been preparing for importing cut rice and other varieties.
In coarse grains and pulses, prices ruled steady but the activity was at a very low ebb.
Among pulses, imported arrivals had been on the rise while the demand was extremely poor. Sellers were keen but prices have been quietly steady.
Gram declined further on financial difficulties and deliberate attempt by a party to dishonour liabilities, putting pressure on the traders importing pulses.
Even upcountry outstandings have been delayed, hampering trading.
Among pulses, gram deshi ruled between Rs 1,275-1,350 and gram dal at Rs 1,600- 1,800 per quintal. Kabli gram ruled easy at Rs 1,325-1,550 per quintal. Moong and moong dal were offered steady at Rs 1,600-1,800 and Rs 2,200-2,500 respectively. Urad was steady at Rs 1,100-1,200 and urad dal was steady at Rs 1,800-2,000. Tur and tur dal, peas and masoor were traded at the steady level in limited quantity.