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Tuesday, April 17, 2007


The new Korean Tender after a delay of 2 weeks is finally declared today. Although the quantity was
reduced to 4000 MT from the initial expectations of 5000 Mt , India still managed to bag 3000 Mt as anticipated
and about $ 120 (Average) higher as compared to last tender declared on March 5th. This clearly indicates that
Africa is still expensive as compared to other origins and may continue to be as their crop size is nowhere near normal.
1000 Mt @ $1042 ( India)
500 Mt @ $1038 "
500 Mt @ $1048 "
500 Mt @ $1042 "
500 Mt @ $1047 "
1000 Mt @ $1035 (Pakistan)
4000 Mt Total
Interestingly if you look at our last reports of March 5th you will notice we mentioned about this price rise as follows.
QUOTE "If we take the Korean Tender and African Prices as benchmark , it still leaves India a whooping $100 cheaper and that much more window to increase at the least in the coming months." UNQUOTE
We did see a panic situation in March which took the prices even higher than expected, to levels which were definitely not sustainable as the prices shot up too much too quickly , from what we saw the prices were being governed by 3 major factors :
A ) Forward selling by both Exporters and Importers to their respective clients which needed to be covered and as the prices started to rise it created a panic situation.
B) Genuine reason that the arrivals virtually stopped at farm level creating a short supply and as a general rule the stockiest came into play.This factor still remains valid as the material in the market is now barely enough to sustain a normal Export demand of about 100,000 MT for the six month period April-September from India.
C) All the global crops which are supposed to create supply pressure during Feb/Mar ( Africa & S.America) failed to do so as none had a normal crop , irrespective of the prices it is still a fact that none of the origins have a big crop and as the earliest new crop is still a good 5 months away ( China comes out first in September) we expect the volatility in the prices will stay.
The Indian market needed a correction and that is exactly what has happened in the last 2 weeks, however most of its effect is diluted by the big fall in USD against Indian Currency. The Rupee is at its 9 year highest levels against the USD which makes things that much more complicated for exports. Since the start of the season itself we have seen the $ fall by as much as 8%.
We have time and again repeated that despite the rising price there will be some opening which would allow a good bargain , from what we see that now is the time to keep a close watch and also not a bad time to cover and make a good average base for the coming 5 months.
The likely demand for Ramadan and from China is still a major factor and once that happens it could create a similar situation as last month where everyone waited and waited and then stepped into the market all at the same time. The markets are now at a very sensitive stage and any small indication of demand will definitely push up prices to it is advisable to step in slowly and quietly.
As the prices have gone up almost 30% from season start level it is more likely that the stockiest are sitting on merchandise which is purely their profit having recovered their principle amounts by disposing 60-70% of the total , this gives them enough liquidity and financial strength to hold on to the little they are left with and not offer huge bargains. As on date as well with falling prices it would not be possible to get out bigger volumes at similar levels , just as we said in our last reports that at some stage you may have the desired price but not the desired quantities.

Saturday, April 14, 2007

Short supply in the market at the moment , arrivals stopped last month and withprices rising suddenly there was lot of buying ,prices have risen by almost 40% since the start of season and almost all stockiest made money which has given them enough liquidity strength to now hold on to whatever little stocks they are left with , so unless there is some drastic change we do not see the markets falling by much.
Currently the markets are quite , mostly due to lack of demand owing to the long Easter holidays , there is
however a Korean Tender of 4000 MT to be declared next week on 17th April , if India once again gets this we may see
another jump.

Wednesday, April 4, 2007


The much awaited Korean Tender was finally declared today.
As expected India was awarded all 6000 MT , however surprisingly this time there is a huge price band( $ 906 - $958 ) in which the tender has moved , clearly showing that the gap between India and African/Pakistan prices have now grown substantially and that the market is now ready to accept higher and all possible price levels.
1000 MT @ $906
1000 MT @ $910
500 MT @ $923
500 MT @ $928
1000 MT @ $929
500 MT @ $941
1500 MT @ $958
6000 Mt Total
Interestingly all other origins were well above $ 1000 Levels and that too for much smaller quantities.It is now clear that Africa does not have the usual crop size ,they have come out with revised crop estimates which put their crop to just about 70-80% of last year levels.If we take the Korean Tender and African Prices as benchmark , it still leaves India a whooping $100 cheaper and that much more window to increase at the leastin the coming months.
Sources/Rumors have it that new Korean tenders will also be floated in the coming 4 months , for 5000 MT + quantities each, that has put a lot of pressure on the market already as the current stocks may be barely enough to accommodate these quantities and normal demand at best. Even last year the Korean tenders picked up about 15,000 MT in the period April- Sep, this figure is most likely to be much more this year looking at the sesame crop scenario outside India.
Markets continue to remain bullish and firm.Prices as we all know have touched new heights and still show no sigh of slowing down. We still believe that there is enough stocks in the market to keep us going till the arrival of next new crop but just enough.By normal demand India should export around 100,000 MT in the period Apr-September which is all with strong stockiest now as arrivals have virtually stopped in the markets now.
We did point out some major points which could be crucial in determining the prices in our last report and each and unfortunately each and everyone has made an impact.Prices have risen by almost 20% since the start of the season giving the Stockiest a huge advantage and strength to further hold on for longer periods. We still think that it would be highly optimistic to believe that one can get huge discounted viz a viz current levels in the coming months.
Everyone ask's " What do you think will be the highest level this year ?" , I wish I knew the answers to that , " Are the current levels overpriced ?" , To this I can confidently say NO , they are not. We have seen that the prices rise very quickly and then stagnate for week/month before another jump , giving us all a false re-assurance that they are sliding when indeed they are just bottoming out , this should continue to be the trend in the coming months and the jumps as we all know are in quantum of 50-100$ each time so even with just a few hiccups in the next 6 months we may see prices touch new highs. I think at current levels the market at max may drop 2-3 % but to gain there is a lot lot more.
Here we are not even taking into account the probable return of Chinese Demand later in the season, possibility of next 3-4 Korean Tender each going to India and also the month of Ramadan which again starts in September this year, the shopping for which should start anytime around July/August. We wont have the new crop by then so once again the demand will have to be substituted with the current crop and just as we saw last year the prices took a huge leap in the later month when the Ramadan demand from Middle East/Indonesia, Turkey and Lebanon set in. This year should not be any different.
Markets are sounding bullish and we are no different. However I would still say there definitely would be some openings to get a good bargain in the market when smaller players decide to book profits and exit the market.It is very important to keep a close watch on the markets from now on as you may see your desired price levels but may not get the desired quantity at those levels.


In continuation to my last report , prices have more or less stabilized with minor up's and down as per demand and supply.
The US$ remains volatile though at lower levels effecting the prices.
The local/domestic demand which had created a panic like situation has slowed down and the Export demand which was slow during holiday season is showing sighs of recovery despite this the prices have managed to stay more or less constant,indicating the bottom line resistance just as we had anticipated.
I believe most buyers domestic & overseas are now covered for their short term requirements upto Feb-Mar, so we don't see a big buying coming in the market for the time being unless everyone suddenly decides to step in the market to cover their long term, so there is little to panic.
However we must keep a close watch on the Korean Tenders,rumors of demand from Turkey/Middle east as African prices continue to remain high and maybe the return of Chinese demand in March after the end of their New Year Holidays , upon which they would have substantially depleted their existing stocks.
The arrivals from farmers have dwindled and we might not see fresh arrivals in the market beyond Mid Feb after which the prices will be stock driven.The crop situation is now almost clear and with evident figures of arrival in Gujrat,Maharastra Rajasthan over the last 90 days we can now safely say that their crop is indeed a failure and may not cross 70-80,000 Mt put together and the U.P/M.P crop put together will be around 175,000 Mt against initial estimates of 200,000 Mt.
However all these figures have little impact on prices for now but it has definetly resulted in a lot of stocking this year. Also as stated in my last report the news of weak mustard/rapeseed crop is also keeping a check on prices. This year in India we are facing a very dry and
comparatively a timid winter which is effecting most winter crops grown here ,this is the biggest oilseed crop season in India and a bad crop of Mustard/Rapeseed could have great impact on other oilseeds in the coming months.
I still believe between now and Mid March there will be some great windows to cover your requirements at attractive prices as the short term players in India would bea eager to exit from sesame to other commodities.After that its only the strong holders in the market who are anticipating a rise and probably would not offer a discounted price in a rush , however we still don't see a vast price rise in long term either,maybe in line of a average 1.5%-2% /Month from Feb onwards.
The news from Africa confirms a good crop this year well but its still too early to asses the size,by the time African crop make any impact on international prices we would have entered into a phase where India will have sold/consumed most of its crop and stockist would determine the prices.Latest news from Africa also confirm that the prices are still high there.

Korean Tender 20th Nov

20th NOV-2006

The Korean tender was declared today , please find the details as below :
2000 Mt @ $ 806 to Sudan
1000 Mt @ $ 827 to Pakistan
1000 Mt @ $ 821 to India
1000 Mt @ $ 829 to India
500 Mt @ $ 829 to India
500 Mt @ $ 833 to India
700 Mt @ $ 831 to India
Interesting facts to note is the price difference between India and Sudan's price, for the past 5-6 Tenders we always saw that Sudan was 4-5 $ above India but this time its the opposite way round so it seems that Sudan got rid of its old stock at low prices and since they did not bid a huge quantity seems like they don't have a big carry forward either.
Now it would be interesting to see if with their new crop Sudan decides to sell at lower price than India or do they
Increase their prices in line with Indian prices knowing well that India also does not have a big crop to offer discount prices.
Another point to note is the absence of Chinese Bid's , which clearly states that although they have a big crop its still not enough for exportsso there is always a chance of them buying little from Africa later.Pakistan is not all that competitive either.
Markets have not risen today after a panic increase we saw in the past 2 weeks,but they have not fallen either mostly due to strong domestic demand and should remain stable and firm in the coming weeks.
I think we are very near the bottom line now and with bad news of weak Mustard Crop , high prices of Groundnut and Soya bean already floating in the market i don't see the markets going down by a lot even with weaker
demand and soft international prices in months to come.

Price Rise Report November

have complied a few reason for the sudden price rise for your assessment.
Like i mentioned in my previous reports the local demand which was very quite suddenly picked up and buying started at all levels ,although the demand is not huge but still since it came all too sudden and that created a panic among in the sellers , specially the Sun Dry factories which had sold quite a volume for exports now did not have much spare capacity for Nov/Dec delivery and hence got very good premium on prices from the local market.

The stockiest also decided that previous weeks levels were lowest and stepped in to buy as well. Heavy stocking was seen on all sectors including stockiest from the Gujrat/Maharastra region where the crop is less , so it is highly unlikely that further down in the season we will see very lowlevels again.

Few of the buyers panicked as well , some which had held back their spot buying for a better price till very last moment also stepped in. I mentioned in my previous report that if all buyers step in together it could create a tricky
situation and that is almost what happened last week.

Rupee went up almost 3% against the US$ in just 1 week adding to the problems.

News of a 6500 MT Korean Tender on 20th Nov created some ripples as well as few of the regular Tender players were seen covering from the markets. If India does get this tender it could boost the confidence of traders once more
as all the news of African carry over stocks and low prices for new crop will then be nullified since the delivery for this tender is upto Jan 2007 well after the new crop arrival of African crop.

The arrivals have also gone down substantially and it seems like all the news of a Bumper crop in U.P and MP region are not all that true , we still have a good crop but nothing in the range of expectation of 200,000 MT , it is more likely around 150,000 Mt.

Overall it was a panic situation last week and definitely not good for the trade,i am sure a lot of Sellers and Buyers were caught off guard by this sudden market change,but that's how it is in the Indian market , i think we will see such panic situation more in the coming months based on various situations then.


Like i previously informed our clients that markets were expected to ease after the Diwali and Ramadan holidays on event of bigger arrivals which did happen in the last week.
However the arrivals are now back to normal and prices have again started to firm up in the last few days due to some demand lately.If you recollect from my previous report in September,i had indicated that the Rupee generally slides in the period of Nov-Jan in line of heavyexports from India that has been the case this year as well.The rupee has slided by over 3% against the US$ in the past 2 weeks and continues to slide even today,this automatically makes the export that much more expensive even if the local prices stay the same.
We have not yet seen the local winter demand in India or heavy stocking at current levels but we assume
that it may start very soon to add stability to local prices. I agree to that fact that China has a good crop and Africa looks good till now as well but there are still 2 month before African crop is out and a little more period before that will
create any impact on international prices. Africa has also witnessed high prices in the last two years so it is unlikely
they would be eager sellers at throwaway prices too, china in the past has surprised us all and with theirNew Year falling in Jan they may end up using a majority of their crop and might come back for shopping later in the season once again , Chinese are known to have sudden quantum jumps in their demand in the past whichhas virtually turned them from a net exporter to a net consumer country.
If by Dec-Jan India does manage to sell a substantial quantity then it could be a tough year ahead as the stockiest
will not part with their stocks at lower levels than today's. We also have to keep in mind that the groundnut, Sunflower
and Mustard crop is not very big this year in India and their prices are on the higher levels as well , so if sesame prices fall any further , sesame may get diverted to the crushing factories as the oil content is much more that other oil seeds and the oil can then be used for blending with other expensive grades.
If the farmers do manage to keep the current prices going till Dec-Jan after which the crop is mostly in the hands of
stockiest and exporters it could create a tricky situation. I believe most buyers have held back their demand in anticipationof falling prices and i can only hope that everyone does not step in the market together anytime soon.
We are in no way trying to indicate that prices may shoot up but merely stating a few points which we come across locally , we have in the past said that prices are likely to remain stable and firm with periodic up's and down this year and overall we still think that the Yearly Average Price of your purchase is unlikely to go below current levels in all account , unless something drastic happens in the coming few months.

Sesame Seed

Hello friends, i have created this blog to collect and discuss information about the Global Sesame Seed Market. I am sure with all our collective efforts we can gain from mutual knowledge.