Chana caught in a bear grip on low demand

The chana futures market has been continuously falling since the beginning of this month. The entire pulses segment is feeling the pinch as well mainly because of a lull on the demand front.

The tenders announced by the government in the recent past had played a vital role in pulling the rates down, said market sources.

The contracts for the immediate months have plunged by over 9 per cent. On the National Commodity and Derivatives Exchange (Ncdex), the near-month chana contract is ruling around Rs 2,188 a quintal, a dip of around Rs 220 a quintal compared with the price at the beginning of the month. The scenario for the July contract is no different. It is hovering at Rs 2,237, compared with Rs 2,460 at the start of the month. The ripples have been felt in the spot markets across the country.

The prices of chana have slipped by almost the same proportion, whether it is in Indore, Delhi or Latur. The market sources said the spot rates ranged between Rs 2,140 and 2,200 a quintal.

If the commodity analysts are to believed, the fall that chana had to see has already come. "There should now be a range-bound movement between Rs 2,100 and 2,200 a quintal," said a commodity head of a broking firm.

It is learnt that the coming month may see a demand for chana, which could bring a recovery to the market. "But the recovery is highly unlikely to match the commodity's decline in the last couple of days," said an analyst.

The country is expecting an overall crop output of 55 lakh tonne this year.