Chana prices soft on higher output

Mumbai, Dec 29 | Updated: Dec 30 2006, 05:30am hrs
Chana (chick pea) spot and futures prices are seen softening in 2007 due to higher crop estimates.

Tur (pigeon pea) prices in 2007 are likely to rise on lower crop in Karnataka, Andhra Pradesh, and Gujarat, analysts and traders said.

Chana prices will be lower up to 25% in 2007 thanks to higher crop, estimated at 6.3-6.5 m tn compared with about 5.5 m tn in 2006. The 2007 crop is expected to start arriving from February, said Kishore Narne, chief analyst, Anand Rathi Commodities

Analysts said chana output in 2007 will go up because of higher chana sowing acreage and favourable weather conditions.

"Rains in Rajasthan, one of leading chana producing states, early this week will also be highly beneficial to standing chana crop," said Niraj Shukla, analyst, Reliance Commodities.

Chana will be lower in 2007 also because the output may be higher than total Indian consumption of (around) 6 m tn. Besides, about 200,000 tn chana are imported every year, together from Australia, Canada, and South Africa, said Suresh Mantri, chief analyst, Ventura Commodities.

Traders in Delhi, the largest Indian spot chana hub, said chana spot prices in March, when new crop arrivals will be in full swing, can go down to Rs 2,150 per 100 kg compared with around Rs 2,500 now.

CRISIL MarketWire