Chana prices rise by 3 % on low supply

Chana prices in the spot market surged by 3 per cent during the week on the back of continuous low supply and speculative bullishness in the physical market.

Though chana prices today showed a marginal decline, market experts say it will be short-lived and prices may notch up another 5 per cent.

"The supply shortage in the physical market is continuing. Moreover, forward contracts for chana signed with Australia have reached $600 a tonne which earlier was $530 a tonne. This is also impacting the spot prices of chana," said a Mumbai-based commodities analyst.

The Australian crop will be landing in the country by October-end. As the forward contracts have been at higher levels, market sources said that traders will continue stretching the bullish market.

The Indian crop reaches the market around February. The spot prices of chana on National Commodities and Derivatives Exchange (NCDEX) closed at Rs 2,898 a tonne, down by Rs 10. Where as on Multi Commodity Exchange (MCX) the price closed at Rs 2,900 a tonne, down Rs 5.

However, on the weekly basis, the prices have registered a jump of around 6 per cent from Rs 2,711 to Rs 2,900 a quintal. Market sources said that levels of Rs 3,000 and up are unavoidable in the present circumstances.

"Supply is nearly half of the current demand. At present, there is a demand of above 8,000 quintal a day and supply is less than 4,500 quintal," said Ajay Kumar, a Delhi-based trader.