Exports cut by Pakistan lifts prices

IN FOCUS/ CHANA

The prices of chana or chick pea have risen by approximately Rs 100 in the last week alone both in the futures and the spot market, owing to a cut in exports by Pakistan and a rise in international prices.

The free on board (f.o.b.) price of chana has risen from $250 per tonne to $312 per tonne "" up 24.8 per cent "" in a fortnight.

This is in addition to the news of a proposed reduction in Pakistan's exports to South Asian countries, which was seen worsening the domestic supply shortage.

The demand for the pulse is especially high during the ongoing wedding season.

Pakistan was initially slated to supply a record 2.5 lakh metric tonne of chana to India, but two days ago announced a reduction in the quantity of its chana exports thus causing further tightness leading to the rise in prices.

In the Indian futures market, for the period between May 23 and May 30, the prices of the June contract of chana saw a climb of 5.9 per cent in the price from Rs 1,556.00 per quintal to Rs 1,648.00 with an open interest of 53360 gram and a volume of 10,1550 gram traded.

A prominent importer of the pulse indicated that if the bullishness in the market continues the price is likely to go up further by Rs 50 considering the demand and supply mismatch.

In addition, he revealed that more major mill owners are also becoming direct buyers of chana.

According to Vineet Rai, assistant vice-president, Angel Commodities Broking Ltd, "Yellow peas, which is the closest substitute to chana is also seeing a good rise in demand. The prices of the peas are also likely to go up in the near future and it would be a good time to look at investments in this pulse."

India's average production of chana is usually 57.5 lakh tonne, however this year has seen an acute shortage of the crop at 45 lakh tonne. The low crop was attributed to not conducive weather conditions in the pulses growing regions of Madhya Pradesh, Gujarat and Rajasthan.

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Pricey pea

• The free on board (f.o.b.) price of chana has risen from $250 per tonne to $312 per tonne "" up 24.8 per cent "" in a fortnight
• The prices of the June contract of chana saw a climb of 5.9 per cent in the price from Rs 1,556.00 per quintal to Rs 1,648.00 with an open interest of 53360 gram and a volume of 10,1550 gram traded