Chana futures down on high margins

Weak trading sentiment keeps spot market afloat

Chana (chickpea) prices slumped in futures by up to 3.3 per cent on Monday to Rs 4,894 a quintal, following the total of 75 per cent margin levied on Friday by the National Commodity & Derivatives Exchange.

Chana contracts for delivery in April fell to trade at Rs 4,243 a qtl as traders offloaded their inventory. Chana for April delivery is trading with a 20 per cent discount to the price of near-month delivery. Chana for delivery in January is trading with nearly a two per cent decline at Rs 4,894 a qtl.

“The new season’s harvested chana will hit the mandis (wholesale markets) in February–March. Being the first month contract after the rabi harvest, traders are going short for April contracts, especially because of the measures taken by the government to cool down pulses’ prices. The overall trend has turned bearish since the government announced action against stockists and import. So, traders are selling for April delivery contracts but remain positive for December and January contracts,” said Ajay Kedia, managing director, Kedia Commodity Research, a city-based brokerage.

Tll last week, chana attracted a 9.8 per cent initial margin, a five per cent additional margin and a 20 per cent special margin on the long side. From Monday, the special margin has been increased to 45 per cent. There is also an expiry margin applicable in near-month contracts. With this, the total margin in November chana contracts will be 75 per cent from Monday on the long side. Also, an additional three per cent daily margin will be levied till contract expiry, taking the total margin on the final day of the contract to 100 per cent.

The physical market for pulses was relatively calm, due to the absence of active traders. Tur (pigeon pea) and chana prices remained unchanged at Rs 10,000 a qtl and Rs 5,000 a qtl, respectively, at the Vashi (Navi Mumbai) Agricultural Produce Market Committee yard.

The traders’ body, India Pulses and Grain Association, has been selling tur here at Rs 95 a kg through large retail chains, as an aid to the government’s effort to get prices to moderate.