Rice, wheat prices decline on new arrivals
MARKET ROUND-UP
| The spot prices of normal rice in Delhi could not sustain the upward trend and declined by 0.27 per cent on account of fresh arrivals. |
| The prices on Friday closed at around Rs 1,095 a quintal from Rs 1,098 a quintal a week ago. Similarly, the spot wheat prices also declined by 2.13 per cent in Delhi to close the week at around Rs 1,114.30 a quintal from Rs 1,138.50 a quintal last week. |
| However, the price of basmati rice for the near-month contract on MCX jumped by 7 per cent to close the week at Rs 3,820 a quintal as against Rs 3,568 in the beginning of the week. The price of basmati rice for December delivery witnessed a surge of 3.69 per cent on Saturday. |
| The current jump in prices is because of the uncertainty over the final output for the season, despite estimates having been released much earlier. |
| Meanwhile, the futures market for foodgrains remains bullish owing to enormous stockpiling by traders, coupled with heavy procurement by government agencies and multinationals. |
| Traders believe the ongoing season for paddy procurement would get over in a month. |
| The stockists are, meanwhile, building paddy stocks to convert them into rice and sell husk and hull for co-generation and animal feed respectively. |
| Stockists are set to sell rice at higher prices once the current season ends, opined traders, attributing this as the reason for the bullishness in the futures market. |
| Despite, the government's claim to take all measures to bring down wheat prices to affordable levels, bullish sentiment prevailed in the futures market. |
| Wheat prices for almost all contracts are still quoting high. |
| A Rs 50 increase in minimum support price (MSP) of wheat to Rs 750 a quintal this year from Rs 700 a quintal last year is set to raise the wheat procurement prices in the forthcoming season, thereby boosting up its futures prices. |
| The restrictive profit-booking helped control the weekly loss at 4 per cent for the December delivery wheat contract on the Ncdex. |
| The contract closed at Rs 1,085.40 a quintal on Friday from Rs 1,131.40 a quintal a week ago. The price of wheat contract for January delivery fell by almost 3 per cent to close the week on Friday at Rs 1,107.80 a quintal from Rs 1,139.60 a quintal a week ago. |
| The decline in wheat prices is partly attributed to higher acreage this year, which stood at 113.74 lakh hectare as on November 24 "� a rise of nearly 17 per cent over the 96.93 lakh hectare in the same period last year. |
| Meanwhile, the International Grain Council (IGC) has raised the global grain consumption by 2 million tonne. |
| The recent report of the IGC has pegged the total global grain output in 2006-07 (July-June) at 1,557 million tonne against the consumption of 1,623 million tonne. |
| The report said the current carry-over stocks at 242 million tonne is at a 10-year low. |
| According to the IGC's projections, the world wheat output will go slightly up by 2 million tonne to 587 million tonne from October "� still 31 million tonne short from the actual output of 2005-06. |