A divergent trend was witnessed on the Mumbai bullion market last week. Silver recovered while gold ruled quiet, despite very good demand at the upcountry centres, due to weakness in overseas. Sellers were reserved in gold, expecting a shortage in coming days and change in sentiment abroad as fresh central bank sale would not be forthcoming.
Traders are now looking forward for a fairly good festival demand during Pooja and Dassera because of the lower prices. Even reports from Dubai indicates the same, stating low prices had resulted in doubling of the demand there. At the same time special licence premium fluctuated to be later placed higher at around 13 per cent.
Normally Delhi had been the centre for silver offerings to other places as most of the imported official and contraband supplies were diverted there, now they have been buying silver from others. Even in South supplies of gold has been sluggish compared to the brisk demand there, resulting in prices there ruling higher than Mumbai and Delhi.
The inflow of gold in South, particularly in Kerala through NRIs have been insufficient to the demand there. The entire picture has changed with brisk demand reported at upcountry centres with gold supplies in shortage at various places.
Overseas both gold and silver after modest recovery dropped to some extent. Gold touched the recovered level of $328 per ounce but receded to $318. The prices are likely to move between the range of $320 -325 levels. Fear of sale of Central Bank gold in Europe has not proved correct at least so far and hence the bearish trend has halted for the time being. Nine offerings at lower levels has been limited while oversold position would have to be corrected and hence prices are likely to stabilise for the time being.
Standard mint gold commenced last week at Rs 15 lower at Rs 4,565 and on quiet overseas advices receded to the a low of Rs 4,520 to end at Rs 4,550.
Oilseeds: After initial firmness castorseed futures lacked follow up support to close with on-balance small losses on the Mumbai oilseeds market last week. The firmness, on fresh bull support from the Ahmedabad castor futures and profit-taking receded from higher levels. At one time the Ahmedabad prices were ruling about Rs 40 higher than in the city but later narrowed to Rs 30 and hence offerings increased here. At the same time the castorseed inflow in Gujarat which dropped to 10,000 bags, once again rose to 13,000 bags a day. Besides as expected fresh export commitments for castor oil has not materialised. Despite dry weather conditions and reports of lower crop prospects, higher levels attracted bull unloading. In edible oils, rising trend in groundnut oil here as well at in Saurashtra had been halted following rains over producing centres. However, farmers are waiting for rainfall soon for groundnut crop in Gujarat and other producing centres like Andhra Pradesh and Madhya Pradesh. In view of the heavy inflow of imported oils, available at lower rates, the demand has increased. Palmoleine, therefore ruled lower.
Castorseed September recommenced at Rs 1,148.50, 50 paise higher than the previous close and on firm Ahmedabad advices, it shot up to a high of Rs 1,157.50. Due to lack of follow up support and weakness in Ahmedabad the contract drifted to a low of Rs 1,141, to end at the same level. Castorseed Madras small dropped from Rs 1,162 to Rs 1,152 per quintal. Commercial castor oil lost Rs 2 at Rs 260 per 10 kg.
In edible oils, the demand for groundnut at higher levels dropped as retail purchases stopped at the end of the month. Prices on higher Rajkot advises moved up from Rs 369 at the end of last week to Rs 375, ending at Rs 374. On the other hand, with the likely inflow of more than 15,000 tonnes of imported oils, coupled with lower Malaysian palm oil advices, Palmoleine was down from Rs 261 to Rs 255 to recover at Rs 257 per 10 kg. The supply position is very comfortable and with the arrivals of three consignments of imported oils, the festival demand could be met without difficulty. This would arrest undue rise in prices of groundnut oil next month.
Grains : In a restricted turnover, prices of cereals, coarse grains and pulses ruled steady on the Mumbai market last week. Meanwhile, the Food Corporation of India is having comfortable stock positions of foodgrains particularly wheat, the stocks of which are comfortable. Wheat ruled steady in moderate activity. The inflow was good as wheat crop had been fairly large. Punjab inferior moist wheat ruled steady at Rs 640-650 per quintal. Ganganagar variety fetched Rs 675-700, and MP-147 at Rs 650-750. Shihori pissi was at Rs 700-1100. The demand was poor.
Rice attracted little attention, and both supplies and demand were limited with prices ruling steady. Among pulses, gram was slightly higher on moderate demand. Deshi gram was traded at Rs 1,355-1,375, gram dal at Rs 1,550-1,600 and kabli gram at Rs 1,371-1,600. Moong ruled steady between Rs 1,400 and Rs 1,700 and moong dal at Rs 1,950-2,200. Peas green ruled better at Rs 1,381-1,400 and Rohndo at Rs 1,525-1,550. Urad was steady at Rs 1,050-1,075 and urad dal at Rs 1,450-1,600. Tur old was steady at Rs 1,050 and new at Rs 1,150-1,200. Tur dal was demanded at Rs 1,900-2,100 per quintal. The declining trend among pulses has halted and up country demand had slowly started.
