Agri Commodities Review: Normal Monsoon Projections Weaken Prices, Guar Complex Falls To Contract Lows

Agri commodities slipped on NCDEX as calls of a normal monsoon were buttressed further. After declaring arrival of rainy season in the country, the India Meteorological Department (IMD) has now predicted that the north-west India n++ Punjab, Haryana, Uttarakhand, Himachal Pradesh, Jammu & Kashmir, Delhi and western Uttar pradesh will get the highest overall rainfall during the June-September period and July will be the wettest month in the approaching monsoon season. According to the IMDs prediction on distribution of rainfall, the central India too will get normal rainfall. The north-east India is likely to get least rainfall (below normal) during the period. The IMD made these observations in its second long range forecast for the south-west monsoon. It noted that region wise, the season rainfall is likely to be 100% of long period average (LPA) over North-West India, 99% of LPA over Central India, 95% of LPA over South Peninsula and 93% of LPA over North-East India all with a model error of n++ 8%.

This pulled the major commodities lower. Coriander tumbled 4% with the benchmark futures extending losses in the afternoon trades.

Guarseed and Guargum, the heavily monsoon linked counters, witnessed a massive slide, falling to fresh contract lows as recent slide extended.

Castor, Refined Soya Oil and Soybeans also witnessed steep selling pressure.

Spices also dropped. Not much of demand is seen in Turmeric and the futures fell to Rs 7100 per quintal, down 0.75%