Commodity Online MUMBAI: Sideways to bearish movement is seen in RM seed futures market.. June monsoon rains have remained below normal this year. Although July monsoon is expected to remain somewhat near normal.
Deoiled Cake export demand in the past few months has declined sharply while huge imported edible oils have made supply comfortable. Demand in oilseeds and edible oil is highly elastic and prices of one substitute directly affect the demand of other one.
Cheap Crude palm oil import has put a pressure on Soy refined and RM seed oil while Sharp decline in Soy DOC export also restricted upside movement of RM seed. A larger section of traders expected a sharp increase in RM seed in past two months but it did not happen and still more chance of corrections are there on overall weakness in oilseeds complex.
Trade sitting at the comfort of home. Start with a mere 50$In fact it is the rainy season which experience good demand of soy and rapeseed oil. Thus, upside movement may be seen by mid July and may continue for a longer duration.
But before that prices are expected to remain range bound. On Friday prices are expected to trade with in a range bound pattern bearish undertone. NCDEX July contract is likely to get support near 522 then 518and resistance at 528 then 530 levels.
Courtesy: Religare Commodities
