Fresh Buying Seen In Chana, Open Interest Up By 11.17%

Chana on NCDEX settled up 3.99% at 5185 on fear of lower-than-expected production coupled with high domestic demand from the food industry. Stockists and traders along with government hasten its procurement for buffer stock Market participants are expecting good spot demand in coming months. In 2015-16, chana imports touched a record high, surpassing the previous record of 7 lt in 2012-13. 

Moreover, imports in December 2015 and January 2016 were more than 5.37 lt — again a record for a consecutive two-month period. During the current marketing year, more than 71 per cent or 6.5 lt of chana was imported from Australia followed by 1.65 lt from Russia. Tanzania, Ethiopia, Myanmar and Canada are the other countries that shipped chana to India. 

This rise in imports failed to check the price, as the imports were expensive due to the 6.2 per cent depreciation of the rupee against the dollar between October 2015 and February 2016. Chickpea prices in Australia touched new highs this year due to high demand from India as dry weather threatened production for the second successive year.

The government, in its Second Advance Estimates for production of major crops, in February 2016, estimated the output of chana at 8.09 lt – 10 per cent higher compared to last season on a larger sowing area and better climatic conditions. 

Technically market is under fresh buying as market has witnessed gain in open interest by 11.17% to settled at 39010 while prices up 199 rupee, now Chana is getting support at 5041 and below same could see a test of 4897 level, and resistance is now likely to be seen at 5257, a move above could see prices testing 5329.

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