Chana futures prices on the National Commodity and Derivatives Exchange (ncdex) may continue to fall further over the next few days mainly due to sluggish consumer demand amid expected higher acreage of rabi crop.
Chana January 2009 contracts on the ncdex platform have fallen by nearly Rs 200 to finish at Rs 2,107 per quintal on Wednesday (5 pm) over the past two weeks on lack of buying support, after the resumption of futures trading in four banned agri-commodity on national bourses. Also, chana spot (desi) prices in Delhi market fell by nearly Rs 100 to trade around Rs 2,180 over past two weeks on poor off-take.
The Forward Markets Commission (FMC) has approved futures trading in chana, refined soy oil, potato and rubber for trading from December 4, after a six-month ban.
Trading volume has risen considerably in the past two weeks. Total volume at the NCDEX increased to 15,490 tonne on Wednesday from just 6,520 tonne on December 4, on the first day of the trading after ban lifted.
?We are noticing a sell-off from stockists mainly due to higher rabi crop sowing this year,? a local trader said. As per the latest estimates, chana sowing till date has been at 71 lakh hectares, up by 10% as compared to last year. With the present higher sowing and favourable climate in the chana-sowing belt, the country is likely to reap a crop of around 65-66 lakh tonne during the current rabi season.
With higher production projections, the future contract price seems to be discounting by trading at Rs 2,050 for April 2009 contract as compared to Rs 2,250 quoted at the spot market.
?We feel that prices may correct from these levels too by another 10%, as old stocks are dispensed and as higher production leads to higher supply,? an analyst with Sharekhan Research said.