Chana to trade weak

COMMODITY SPIKES

Higher inflation and the government's likely intervention in the forward trading of a few commodities kept the chana futures volatile last week.

Though the early trading sessions saw a slight bullish trend, the market could not sustain at higher levels. Reports suggested that standing crops of urad and moong in Tamil Nadu were damaged due to incessant rains in the state.

Such reports fuelled chana prices, which crossed Rs 2,900 a quintal. Commodity analysts maintained that the commodity would remain bearish next week due to less procurement from multi-national companies (MNC).

"It all depends on how these MNCs go for procuring next week," they said. According to them, chana futures are expected to trade weak in the initial sessions and prices could dip by around Rs 30-40 a quintal.

However, they added that buying could return at low levels, taking the market up. The country is expecting around 4.6-4.8 million tonnes of chana against the earlier estimates of 5.8 million tonnes. Arrivals from Rajasthan have already begun and are expected to be in full swing around mid-April.

According to commodity analysts, the May contract will find support at Rs 2,826 a quintal, while Rs 2,982 will offer resistance. On the National Commodity and Derivatives Exchange, the near-month chana contract closed last week at Rs 2,835 a quintal.