Rains, equity blues hit agri futures

Weak sentiment across the board pulled down most agriculture futures today in the market, traders and analysts said.

"Overall, it is a weak sentiment in the market. Rains, however, cannot be given the credit for this, as the pattern has been irregular, and soon we may hear some crop damage owing to excess rains or vice versa," said Rajini Panicker, head - research, Refco Commodities.

A section of market players is even linking this weak sentiment to the bloodbath in the stock market today.

The downfall was most obvious in guargum and guarseed where all the contracts on the National Commodity and Derivatives Exchange (NCDEX) hit the downward circuit today.

"For guar complex, the sentiment was weak with the new crop expected to arrive mid-October," said a Mumbai-based trader.

All pulses' contracts were also down today, and the NCDEX December tur contract hit a downward circuit. Weakness in urad and tur contracts prevailed, as new crops of the former have just begun and that of the latter will begin November (in the current sufficient supply situation, courtesy imports).

In case of chana, however, the weakness was basically speculative. A correction is expected soon. As and when speculators cut short positions, the market will bounce back and is seen above the Rs 1,800-per 100 kg level, said a senior analyst at IL&FS Commodities Ltd.

Prices of guar complex and pulses, on the other hand, remained steady in the market.

Weakness in oilseeds prices, led by soybean and mustard seed, was driven by the spot market. "Soybean and groundnut crops are appearing better than expectation now, and this has pushed the prices lower," said a Mumbai-based trader.

The market sentiment has not even spared wheat, sugar and jeera futures, and the bearish sentiment has kept them slightly lower today. Edible oils, on the other hand, are steady at the current levels, despite the weak market sentiment.