NCDEX Ref Soya Oil likely to trade 659-677; Resistance seen at 674
Commodity Online | September 23 2016
UPDATED 14:08:53 IST

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Ref Soya Oil on NCDEX settled up by 0.84% at 670.8 amid pickup in demand for edible oil in domestic market. The surge in price indicates the expectation of physical demand in coming weeks coupled as government might try to increase import tax on refine edible oil. For second half of September government decreases the tariff value of crude soy oil compared to previous fortnight. Tariff value of crude soyoil cut by $31 per tonnes to $817.

Government fixes the tariff value every fortnight. Base import prices of edible oils revised every fortnight taking into account the prices in international markets, as well as changes in the foreign exchange rate. As per SEA data, India's edible oil imports fell 8.4% to 1.25 mt in August, while cumulative imports in the first 10 months of the current oil year that started November rose 4.0% to 12.04 mt.

India Aug crude soyoil import 333,599 tonnes, lower by 18 per cent compared to 406,116 tonnes year ago. High stock at ports and in the supply chain, pegged at over 2.15 mt as on Aug 1, has slowed the pace of edible oil imports into India. Total kharif oilseed production for 2016-17 is seen at 14.5 million tons and rabi output estimated at 8.78 million tons as compared to 10.81 million tons and 7.33 million tons respectively.

At the Indore spot market in Madhya Pradesh, soyoil was steady at 661.45 rupees per 10 kgs. Technically market is under short covering as market has witnessed drop in open interest by -1.02% to settled at 64220 while prices up 5.6 rupee, now Ref Soya Oil is getting support at 665 and below same could see a test of 659 level, and resistance is now likely to be seen at 674, a move above could see prices testing 677.

Trading Ideas:
--Ref Soya Oil trading range for the day is 659-677.
--Ref Soy Oil prices ended with gains amid pickup in demand for edible oil in domestic market.
--India Aug crude soyoil import 333,599 tonnes, lower by 18 per cent compared to 406,116 tonnes year ago.
--Total kharif oilseed production for 2016-17 is seen at 14.5 million tons and rabi output estimated at 8.78 million tons.
--At the Indore spot market in Madhya Pradesh, soyoil was steady at 661.45 rupees per 10 kgs.

Courtesy: Kedia Commodities