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Commodity Important Updates for 6 June 2016

Commodity Important Updates for 6 June 2016

Crude Oil trading range for the day is 3190-3356.Crude oil prices tumbled after OPEC failed to agree on a deal for a new output ceiling, thrusting concerns related to global oversupply back into focus. OPEC failed to agree to a clear oil-output strategy as Iran insisted on raising production to regain market share lost during years of sanctions, which were lifted in January. Despite the failure to agree on a joint policy, rivals Iran and Saudi Arabia both got what they wanted from the meeting. Oil services firm Baker Hughes said that U.S. oil rigs rose by nine to 325 for the week ending May 27, the largest weekly increase since last December.

Zinc trading range for the day is 130.8-136.6. Zinc notched up a new 10-month high continuing its good fortune on expectations of a deepening global deficit. Zinc, is the best performer this year with gains of nearly 26 percent after major mines closed and Chinese smelters pledged to slash output. According to preliminary data by ILZSG, the global market for refined zinc metal was in surplus by 42,000 metric tons over the first three months of 2016. Warehouse stock for Zinc at LME was at 380825mt that is up by 2100mt.

Nickel trading range for the day is 563.6-585.6.Nickel rose as workers at the world’s second-biggest ferronickel mine voted to strike. Prices also seen supported boosted by data showing the U.S. economy created the fewest number of jobs in more than 5-12 years in May. Workers at South32 Ltd. Cerro Matoso in Colombia voted to take strike action amid a dispute over negotiations on a wage agreement. Warehouse stock for Nickel at LME was at 397116mt that is down by -2892mt.

Aluminium trading range for the day is 102.2-105.6.Aluminium prices dropped as there are also concerns over aluminum supply. The U.S. Department said nonfarm payrolls in May rose by 38,000, less than a quarter of expectations for monthly job gains of 158,000.Aluminum inventories monitored by the LME slumped for a 56th day, the longest streak since 2000.Warehouse stock for Aluminium at LME was at 2508225mt that is down by -7450mt.

Naturalgas trading range for the day is 157.7-167.7.Natural gas ended with losses on profit booking after prices gained amid forecasts for warmer weather boosted demand expectations. Demand for natural gas tends to rise in the summer months as warmer temperatures increase the need for gas-fired electricity to power air conditioning. The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. rose by 82 billion cubic feet Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on early summer cooling demand.

Mentha Oil trading range for the day is 865.2-889.2.Mentha oil spot at Sambhal closed at 1010.60 per 1kg. Spot prices is up by Rs.8.80-.Mentha oil dropped as this season the farmers are seen getting more interested in sowing mentha in the major growing area Markets had remained weak for quite some time from lack of demand amidst reports of higher sowing activities. At Sambhal market total arrivals are at 80 Drums (1-drum=180kg), higher by 10 Drums (1-drum=180kg) from previous trading day.

Soyabean trading range for the day is 3874-3978.Soyabean prices gained on supply worries in global market and on improved demand. Moreover, speculation of thunderstorm like weather in second half of the current month may further add on to the uptrend in the prices. NCDEX accredited warehouses soyabean stocks dropped by -155 tonnes to 34275 tonnes. At the Indore spot market in top producer MP, soybean gained 13 rupee to 3992 rupee per 100 kgs.

Chana trading range for the day is 6031-6443.Chana prices gained because of a fall in domestic production, largely due to drought and scanty rainfall. Besides, anticipation of supply crunch in coming months due to lower output from the major producing belts, also added support to chana prices uptrend. NCDEX accredited warehouses chana stocks dropped by -61 tonnes to 1961 tonnes. In Delhi spot market, chana gained by 213.55 rupee to end at 6350 rupee per 100 kgs.

Ref.Soya oil trading range for the day is 655-669. Ref.Soya oil dropped on late profit booking after prices gained earlier on improved festive demand in domestic market. Global oilseed production for 2016/17 is projected at 533.8 million tons, up 2.1 percent from 2015/16. Global soybean production is projected at 324.2 million tons, up 8.3 million. At the Indore spot market in Madhya Pradesh, soyoil was steady at 642.1 rupees per 10 kgs.

Jeera trading range for the day is 15805-16205. Jeera prices gained as good demand is being witnessed amid thin local supplies. Production pegged at 2.13 lakh tonnes (lt) higher by about 7 per cent forecasted in revised fourth advance estimate for 2014-15 at 1.97 lt. NCDEX accredited warehouses jeera stocks dropped by -42 tonnes to 3777 tonnes. In Unjha, a key spot market in Gujarat, jeera edged down by -137.5 rupees to end at 16462.5 rupee per 100 kg.

Turmeric trading range for the day is 7848-7992.Turmeric prices gained on increasing demand from traders and stockiest at the spot market. Turmeric arrivals are increasing in Southern states and not much of demand is emerging from stockiest. Producers are releasing their lower or medium grade Turmeric and holding premium quality in the anticipation of better return. In Nizamabad, a major spot market in AP, the price ended at 8336.1 rupees dropped -25.65 rupees.

Copper trading range for the day is 305.4-321.6. Copper rallied after further erosion of inventories and as the likelihood of early U.S. rate hikes diminished. Copper stockpiles in warehouses tracked by the SHFE fell for a fourth week to the lowest since Jan. 21. There was underlying concern, however, about demand in China, highlighted on Friday after data showed growth in its services sector hit a three-month low in May Warehouse stock for Copper at LME was at 153675mt that is up by 150mt.

Silver trading range for the day is 38180-39740.Silver rallied amid a broadly weaker dollar, as markets largely ruled out a summer interest rate hike from the Federal Reserve following a dismal U.S. jobs report. The U.S. Department said nonfarm payrolls in May rose by 38,000, less than a quarter of expectations for monthly job gains of 158,000.Meanwhile, the unemployment rate dropped by 0.2% to 4.7%, as an estimated 500,000 Americans left the workforce last month. The FOMC has left the target range of its benchmark Federal Funds Rate unchanged at a range between 0.25 and 0.50% in each of its first three meetings this year.

Gold trading range for the day is 28610-29808.Gold surged after U.S. payrolls data fell well short of forecasts, boosting expectations that the Federal Reserve will stand pat on interest rates. The U.S. economy created the fewest jobs in more than five years in May, a Labor Department report showed. SPDR gold trust holdings gained by 0.71% i.e. 6.24 tonnes to 881.44 tonnes from 875.20 tonnes. Gold demand in Asia was muted as a slight increase in India and Japan was offset by reductions in other trading centers as buyers awaited further price declines.

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