Korean Tender , 11th June 2007

The Korean Tender announced earlier this month for 4000 Mt was declared today and India was awared all 4000 Mt . We did mention this in our

last Market Report dated June 4th.

QUOTE"If we go by previous trends and current price situation in Africa , India should once again be optimistic in getting a substantial quantity."

1000 Mt @ $1019 ( India)

500 Mt @ $1005 "

500 Mt @ $ 998 "

1000 Mt @ $ 996 "

1000 Mt @ $ 993 "

4000 Mt Total

Prices have been understandably lower compared to the last Tender of April due to slow demand but still in the same vicinity of March Tender levels , taking into account the rising Rupee. The levels of $ 1000 is still maintained and African and Pakistan prices are still hovering around $50-$60 above Indian prices so at root levels

prices are still holding a resistance mostly due to very limited stocks.

The USD continues to be weak globally and if experts are to be believed the Rupee is likely to strengthen further in the coming months.

Just a breif on the Indian Monsoon situation , the Rains have been confirmed delayed by atleast 1 week in main Sesame cultivation regions of Gujrat, MP , U.P

and Rajasthan. However a further delay of 10-12 days is likely if the rains do not reach Gujarat by end of this week. India for the first time in last 20 yrs is experiencing

very very hot summers with temp rising upto 46 Degree Centigrades in North and Central India.

News from China is that there are heavy rains in certain regions and no rains in some so their sowing has not commenced as well and the crop there as well may be

delayed by a few weeks. It is yet too early to comment weather there is any crop damage or not.

MARKET REPORT JUNE 4th

The much awaited Korean Tender has finally been declared for 4000 Mt and will open on 11th June. Since the last Tender which was announced on April 17th the markets have been very quite. If we go by previous trends and current price situation in Africa , India should once again be optimistic in getting a substantial quantity.

Monsoon as per govt data has touched Indian coasts on time so if all is well we may have rains in Maharastra and Gujarat by Mid of this month and in M .P and U.P by End of June/Early July. The sowing usually commences after the first rains, so with everything going as per schedule we should have new crop in the markets by End September/Early October ( Sesame is a 90 Days crop). This means that the new crop shipments would resume around Mid Oct and reach respective destinations by Early/Mid November. This gives India a good 150 days or 5 more months to work with old crop.

Markets in India have been surprisingly very quite , April/May are traditionally slow months with sluggish demand and this year is no different. The high and unstable prices has also resulted in less aggressive buying from all sectors. The port data however puts in a different picture , we compared the cumulative export data from all the ports and noticed that the actual shipments have fluctuated by merely 8-10% in the last 8 months ( Oct 06 - May 07) , which meansthat most buyers did buy/cover themselves for long term shipments in the earlier months when the prices were not at its peak.

We had pointed this our in our last report as one of the factor for price rise where a bulk of forward contracts were done in the markets in the months of Feb/March.

This also explains why the demand has been sluggish in the last 2 months,a lot of low prices cargo was being shipped which kept the prices at destination under check and the overseas local market did not move in tandem with Indian local prices.

Prices in the last 2 months have more or less moved sideways clearly reconfirming that the stocks are not big enough to create a widespread panic and the stockiest still believe that the demand would resume anytime soon. Current prices may seem high as compared to the season start but that is more due to the Rupee strengthening against the USD. The rupee has appreciated by about 11 % since the start of the season.

For example if we say someone has raw material stocks at oct levels he would have to add 10 % for 8 months as interest ( @ 15% Annually which is basic in India for private lending ) also added to this the warehousing,handling,weight reductions( due to moisture loss) say roughly 1.5% Per Month or 12% . Over and above this we have 11% appreciation of the USD so that makes it a total of 10% + 12% +11 % = 33%.

Taking all these factors into consideration we can understand why the market has shown resilience and not fallen much despite slow demand. At current prices the stockiest are barely cutting even on their stocks and hence are very apprehensive selling their stocks at any lower prices. The markets as be believe has now bottomed out and any further fall would probably end in stockiest holding back and not offering atall.

At the moment about 70% of all Hulling factories have taken a shut down and would resume only on new crop arrival now. Usually factories do not take a shut down if they have stocks left , the operational factories are also running mostly on end to end basis covering their sales and not holding excess merchandise. With atleast 4 more months before the new crop hits the market it would be interesting to see the situation then, as every factory would be eager to cover new crop as soon as possible and resume production. Even if there is slow demand now the stockiest know that the buyers will be without stocks by October and also cover aggressively when the season resumes.

The Ramadan demand as expected has not picked up yet but hopefully will happen by this month end.We have not yet heard or seen of any big stocks in the market and most smaller regional suppliers have almost Zero leftovers.We may have 1 or 2 more Korean tenders before October.

Interesting to see now is that weather the demand stays sluggish for the next 150 days or will the markets finally accept the fact that there is little to loose on current levels and resume buying.

We will keep you posted on the Korean Tender once it is announced.

KOREAN TENDER MARKET REPORT 17th APRIL

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.

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.

KOREAN TENDER MARKET REPORT 5th MARCH

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.

MARKET REPORT - JANUARY 18th , 2007

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

KOREAN TENDER :-

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.