Soya Trades at 10% Dis­count to Spot Price

The Economic Times - - Commodities Plus - Ram.Sah­gal@ times­

Mum­bai: A few sil­ver lin­ings have be­gun ap­pear­ing amid bleak clouds of In­dia’s wa­ter scarcity. The fu­tures mar­ket, which re­flects traders’ fu­ture price ex­pec­ta­tions, is show­ing soy­abean for Oc­to­ber de­liv­ery trad­ing at an al­most 10% dis­count to the spot price of .₹ 4,149 a quin­tal.

This means that if the price is .₹ 4,149 a quin­tal (100 ki­los) to­day, traders to­day feel that in mid-Oct it will be avail­able for .₹ 3,737. This is be­cause of news of an ebbing El Nino, which has caused two suc­ces­sive mon­soon fail­ures in In­dia. The Cli­mate Forecast Sys­tem (CFS) of the In­dian In­sti­tute of Trop­i­cal Me­te­o­rol­ogy (IITM) pre­dicts mostly nor­mal and some­times heavy rain­fall across the coun­try bar­ring parts of coastal Gu­jarat, western Ra­jasthan, north­ern Kash­mir and parts of the North­east.

Another oil, which, post re­fin­ing, is the most con­sumed in In­dia –– crude palm oil –– is also trad­ing at a small dis­count to spot prices. Data on MCX shows that the June fu­tures which was trad­ing at a pre­mium to the spot price last Mon­day, went into a dis­count to the spot price on Thurs­day (mar­kets were closed for the Gudi padwa hol­i­day). From trad­ing at a pre­mium of 12% on Mon­day, the June con­tract slipped to half a per­cent dis­count of .₹ 560.9 per 10 ki­los to the spot price.


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