Turmeric Market Rises On Short Covering, Open Interest Drops 6.71%

Turmeric on NCDEX settled up 0.82% at 8364 as market participants expect good domestic demand and export demand on good quality arrivals from the producing belts. Turmeric arrivals have been higher in Feb and March compared to last year as per data. New season crop has hit the markets and continue to peak in current month but majority of arrivals are of medium quality.

As per dept of commerce data, turmeric exports until Jan 2016 pegged at 69,864 tonnes while the export for the 2014-15 is 90,738 tonnes compared to 77,430 tonnes in FY14. As on latest sowing data, turmeric sowing in AP, Telangana is lower than the normal sowing. Spot turmeric price at Erode markets decreased following a decline in prices of the spice in futures markets. 

Traders have received one or two fresh demand from North India and also were getting medium quantity arrival for sale. Further the price of the turmeric decreased in the futures, so the traders quoted lesser price and purchased the same. Around 10,700 bags arrived and 7,000 bags were new turmeric. 

At the Erode Turmeric Merchants Association, the finger turmeric was sold at Rs. 8,646-10,010 a quintal; the root variety Rs. 8,619-9,399. Of the 2,814 bags that arrived, 1,890 were sold. However, the total production in the coming year is expected to be around 68 lakh bags, up 20 lakh bags from the last year.

Technically market is under short covering as market has witnessed drop in open interest by -6.71% to settled at 29615 while prices up 68 rupee, now Turmeric is getting support at 8269 and below same could see a test of 8175 level, and resistance is now likely to be seen at 8453, a move above could see prices testing 8543.

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