Basmati farming catching on in Kerala

BASMATI rice cultivation is finding more takers in Kerala at a time the state is heavily dependent on rice import from other regions in the country.
    Despite several difficulties like low yield and lack of special mills to process the long-grain rice, what has attracted farmers to Basmati is the higher price.
    The price of Basmati is almost double that of the normal variety, which they feel will compensate for lower yield.
    A few years ago, Kerala Agriculture University tried to promote Basmati rice cultivation. But it could not be grown on a sustained basis because of reasons like extra care required at harvest and the lack of mills to process this type of paddy. At present, Basmati rice is grown in several pockets of the state on a smaller scale. Recently, a group of farmers in Malappuram achieved significant success with Basmati rice cultivation. According to farmer Mohammed Haji, Basmati rice was grown in 12.5 acres and yielded 2,430 kg per acre.
    Basmati rice fetches Rs 14 per kg compared with Rs 8.40 per kg for the usual rice variety. "It is a good price at a time when it is difficult to get labourers for field work," Haji said. They decided to grow the rice on a large scale encouraged by the trial cultivation on 50 cents in the previous year.
    Though Haji had no difficulty in finding a mill in Malappuram, another Basmati rice grower from Palakkad, Sahadevan, said marketing was the main hindrance as specialised mills are needed to process the long, slender basmati grain. At present he sells the rice to mills in Tamil Nadu. Earlier it was thought that Kerala's climatic conditions with plenty of rain did not suit Basmati farming.

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Gold sales see 14% growth on Akshay Tritiya

GOLD demand grew 14% in value terms, but fell 8% in volumes on April 27, when Akshay Tritiya fell, from the previous year's occasion. Data from World Gold Council, an organisation founded by the world's major gold mining companies, pegged sales at Rs 7,280 crore, against Rs 6,359 crore in 2008.
    However, offtake at 45 tonnes was lower than 48.9 tonnes in the year-ago period. The rise in value comes on the back of a 25% yearon-year jump in the yellow metal's price to 14,700 per 10 gm.
    "Sales have been very positive for gold. In value terms, the growth has been impressive in spite of the price increase of 25%. Large and established players selling hallmarked jewellery have performed better than the market," said Ajay Mitra, director, WGC, Indian sub-continent.
    Jewellers in association with WGC offered various promotions to mark the celebration, with stores witnessing an expansion of customer base.

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Rains throw a party for Darjeeling planters

Although Late Rains Have Arrived, Industry Fears Crop Losses Till April Will Be Around 35 M Kg

AS THE hills north of Siliguri slipped into poll mode on Thursday, rain lashed the tea estates of north Bengal and Darjeeling bringing much-needed cheer to the country's top tea producers. The protracted dry spell from end-February has severely hurt production of first flush tea, which attract premium rates in both domestic and global markets.
    "According to rough estimates, tea production in the north (north Bengal and Assam) has been down by 20 million kg in March and April 2009 due to a prolonged dry spell. Though it has started raining in Dooars, tea bushes need more rain to produce good quality second flush teas. Along with north Bengal, it is also finally raining in Assam. The onset of rains after such a long dry spell has brought relief to the tea industry," chairman of Indian Tea Association (ITA) Aditya Khaitan said.
    The ITA chairman was speaking to ETon a day when polls kicked off in Coochbehar, Alipurduar, Jalpaiguri and Darjeeling in the first phase of three-tier general elections in West Bengal.
    Incidentally, the Dooars region encompasses the plains of Darjeeling district, the whole of Jalpaiguri, the upper reaches of Coochbehar in West Bengal and the districts of Dhubri, Kokrajhar, Barpeta, Goalpara and Bongaigaon in Assam.
    The tea industry estimates crop losses till April will be around 35 million kg. "Southern region has also lost some 15 million kg due to the drought-like situation," the ITA chairman said. According to figures released by Tea Board, global tea production was down 38.1 million kg in the first two months of 2009.
    At present, the total shortage in India is nearly 60 million kg. "There is a carry forward shortage of 25 million kg, which means there was a demand supply gap of 25 million kg. If we add up this year's production losses of 35 million kg with this 25 million kg, the shortfall comes around 60 million kg," Mr Khaitan said.
    Rains have also brought cheer to Darjeeling tea industry, which has been hit not only by the dry spell but also the continuous agitation of Gorkha Janmukti Morcha (GJM). Due to the dry spell, Darjeeling has lost the production of its first flush teas, which is sold at a premium in overseas markets. "We are expecting a shortage of 30% in first flush teas. Fortunately, the weather has improved in Darjeeling and it has started raining. We will not be able to recover all of the first flush teas. But we are hopeful production of second flush teas will improve," said Sanjay Bansal, chairman of Darjeeling Tea Association (DTA).

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MCX, NCDEX impose special margin on sugar futures

THE country's top two commodity exchanges, MCX and NCDEX, have imposed special margin on sugar futures in an attempt to curb volatility in prices of the sweetener at the futures market. The measure has been taken on the direction of the commodity market regulator Forward Markets Commissions (FMC) sources said.
    The FMC was recently asked by the committee of secretaries (COS) to watch the movement in sugar prices in the futures market and take necessary steps to curb excessive speculation. According to an NCDEX circular, the exchange has imposed 5% special margin on long positions of all running contracts of sugar except for contract expiring in August 2009.
    After the imposition the total special margin levied on sugar will be 10% on the long side on all contracts except for August, which will remain at 15%. Similarly the MCX has fixed 10% special margin on both M and S grade of sugar traded on the exchange, the MCX circular said.
    Special margin is effective on both the exchanges from Monday. Special margins are announced so that unnecessary volatility is curbed to maintain healthy price movement in the market, an analyst with Hyderabad-based commodity brokerage, Karvy Comtrade said.
    Last week, the COS reviewed sugar prices and decided not to ban futures trading in sweetener for the time being. Sugar prices in the country have increased to Rs 27-28 per kg in retail markets from Rs 18-20 a kg last year.

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US cotton trade sees red over Indian subsidies

American Industry Says India Has Violated WTO Norms; Seeks Obama Administration's Help

THE US cotton industry has expressed its concern over subsidies being provided by the Indian government to its cotton growing farmers, alleging it is in violation of the World Trade Organization's (WTO) norms. Testifying before the US International Trade Commission hearing on India: Effects of tariffs and non-tariff measures on US agricultural exports, the National Cotton Council — the central organisation of the US cotton industry — has sought the administration's help in this regard.
    "The lack of transparency in the operation and scope of India's subsidy programme is a major impediment to trade. Despite India's membership in the WTO, it has repeatedly failed to notify its support levels to WTO," Gary Adams of the National Cotton Council said. The special hearing was convened by the US International Trade Commission at the direction of the US Senate committee on finance in this regard. Mr Adams urged the US government that it should continue to press India to make these submissions.
    "The export subsidy to cotton farmers will support India's internal prices while artificially increasing its competitiveness in the world market," he argued.
    "The addition of an export subsidy to 3-5% discount allows India to increase this discount relative to their competitors," Mr Adams said. He alleged India has chosen to increase its own internal subsidy levels and expand export subsidised cotton. "India has apparently never filed any export subsidy schedules as part of the Uruguay round commitments within the WTO," he said.
    Observing that US' cotton production has dropped significantly along with its growth, Mr Adams said countries like India have stepped into the void with increased production exports and even increased subsidy tariff programmes. The representative of the National Cotton Council said: "Though India does not administer any quota restrictions on cotton imports, but does impose tariffs. Further, India maintains import tariffs on most cotton textile products."
    "Like many textile industries around the world, India is heavily supported by governmental industry policy," he said. In addition to the Textile Upgradation Funds Scheme (Tufs), India continues to maintain several duty drawback programmes, tax holidays for export products and preferential export financing, he added.
    "With a highly competitive and subsidised textile industry, the US remains concerned about preferences extended under the generalised system of preferences programme," Mr Adams said.
TRADE OFF
The special hearing has been convened by the US International Trade Commission
US cotton production has dropped significantly, which creates a void in global markets
Many cotton producing countries like India have stepped into the void with increased production and exports

Jewellery exports regain lustre

INDIA'S exports of gems & jewellery — the third-largest foreign exchange earner for the country — grew marginally by 1.45% to $21.11 billion in FY09 despite a contraction in global demand. The growth, however, is due to a robust performance in the first half of the fiscal. In the second half of FY09, the global downturn caught up with the sector and exports dipped by 18.9%, mainly due to a fall in demand from the US.
    According to the industry, the first six months of the new fiscal will continue to be low-key. However, exports could rise in the second half of 2009-10 if there is a turnaround in the global economy, the Gems & Jewellery Export Promotion Council (GJEPC) chairman Vasant Mehta said.
    Addressing a press conference on Wednesday, Mr Mehta pointed out that the sector witnessed a job loss of about 2 lakh workers during the past year. "The job losses are not just because of downsizing. It is largely due to closing of hundreds of small units because of falling orders," Mr Mehta said.
    The growth in exports of gems & jewellery in 2008-09 was mainly due to a sharp increase of 23.64% in export of gold jewellery to $6.85 billion. Gold jewellery accounts for one-third of the country's total gems & jewellery exports. Cut & polished diamonds, which account for a little less than two-third of total gem & jewellery exports, witnessed a dip of 8.24%, with exports decreasing to $13 billion.
    On the future prospects of the sector, Mr Mehta said the situation was not expected to worsen. "We are looking at a period of bottoming out of the recession. Hopefully by last quarter of the fiscal, the situation would improve, though we have not yet set an export target for the year," Mr Mehta said.
    In 2008-09, UAE was the largest exporting destination with 31% of exports, followed by Hong Kong with a 25% share. The US was the number three destination with its share declining to 20% in FY09 from 25% in the previous fiscal. The sector is also looking at diversifying and tapping new markets. China, Russia and the CIS countries are the ones identified by GJEPC as prospective export destinations.

OIL BIGGIE MAY POST RS 233-CR LOSS FOR FY09

IOC BRACES FOR 1st RED MARK IN 50 YRS

Rajeev Jayaswal NEW DELHI

    INDIAN Oil (IOC), the country’s largest company by sales, could report its first-ever annual loss in its 50-year history next month, as a result of selling fuels below cost at a time when global oil prices hit a record high.
    State-owned IOC, a Fortune 500 company that posted revenues of $62 billion in 2007-08, could report a loss of Rs 233 crore for the year to March-end 2009, according to information provided by the company to its board and approved by its directors last month.
    However, IOC expects to swing back into the black during the current financial year. It is expecting a net profit of Rs 5,452 crore, according to its budget estimates for the year ending March 31, 2010, which was also approved by its board.
    The company reported a net loss of Rs 3,673 crore for the nine months to December-end 2008, compared with a profit of Rs 7,377 crore in the corresponding year-ago period. It posted a net profit of Rs 6,963 crore in 2007-08.
    The company declined to comment, but officials said the 2008-09 numbers were just estimates and could change when annual results are announced towards the end of May.
    A senior petroleum ministry official said the government would take all necessary measures to ensure that public sector oil companies close the financial year in profit.
    The official said these state-owned companies had to bear the brunt of the unprecedented volatility in global crude oil prices last year “to protect the common man”. Now, the government would ensure that they don’t suffer for no fault of theirs, said the official, who asked not to be named.
    IOC and other state-owned oil refiners, which are forced to sell fuel at government-determined rates, were hit hard last year, as their prices could not keep pace with the steep rise in international crude oil prices, which hit a record high of near $150 a barrel last July. Prices have since fallen sharply, as demand for oil fell in the wake of global recession.
    Indian Oil, which has 49% market share, informed its board that its net “under-realisation” from selling petrol, diesel, kerosene and cooking gas below cost in 2008-09 could be Rs 7,497 crore even after considering benefits of getting cheaper crude from state-owned oil producers and government compensation in the form of oil bonds. The estimated under-realisation for 2009-10 is Rs 5,419 crore.
    IOC expects an average gross refining margin (GRM) of $4.34 a barrel in 2008-09, nearly half of what it got the previous year, based on the actual performance for the first three quarters and projections for the last quarter. Its GRM of $9.02 a barrel in 2007-08 was its highest ever. For 2009-10, the company has pencilled in a margin of $4.88 a barrel.
    rajeev.jayaswal@timesgroup.com 

 

 

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Basmati exports may go up by 40%

Iran, Iraq Offset Fall In Demand From Europe & Saudi Arabia; Exports Of Pusa1121 Variety May Rise To 15 LT

 BASMATI rice exports are likely to post growth of nearly 40% in the fiscal year ended March 2009 with increased pick up from Iran and Iraq offsetting the fall in demand from European and Saudi Arabian markets.
    Exports, primarily of the premium variety of Pusa1121, are likely to have grown to 15 lakh tonnes in FY09 up from 11.8 lakh tonnes in the previous fiscal, according to an official from Agricultural & Processed Food Export Development Authority (Apeda). In value terms, said the official, India's basmati exports totalled $1.5 billion in the fiscal year to January 2009.
    Anil Mittal, managing director, KRBL, producer and exporter of India Gate brand of basmati rice, said India is likely to have exported close to 550,000 tonnes of Pusa1121 to Iran against 300,000 tonnes last year and an additional 75-100,000 tonnes to Iraq.
    According to Mr Mittal, the growth in Pusa exports to Iran could be attributed to the $500 per tonne price advantage of the Indian variety compared with the local Iranian brand, Domsiah, which quoted at $2,000/tonne during the previous fiscal. "Lower price and a fall in local production of Domsiah led to a jump in imports of Pusa1121 from India," he said.
    The government included Pusa1121 variety under the basmati category in the previous fiscal, with its exports getting under way from November 2008. Pusa1121 is grown mainly in Punjab and Haryana, two of India's key riceproducing states and contributes over 70% of rice exports from the country. The other variety of basmati rice, Pusa Basmati-1 (PB1), however, lost export share in Europe and Saudi Arabia which imported an equivalent variety from Pakistan, which offered a lower price than India.
    In January 2009, the government scrapped the Rs 8,000-pertonne export tax on basmati rice and also lowered the minimum export price (MEP) by $100 per tonne to $1,100 per tonne. Despite these measures, All India Rice Exporters Association president Vijay Sethia disagrees over a possibility of growth in basmati exports in the previous fiscal. "There could be a growth in value terms because of high prices, but not in volume," Mr Sethia said.
    According to him, basmati rice exports could take a hit on account of the MEP which went up from Rs 48,000 per tonne in FY08 to Rs 55,000 tonne in FY09 despite the government lowering MEP to $1,100 from $1,200 due to a depreciation of the rupee. He feels that basmati rice exports will be close to 1.34 million tonnes (mt) against the trade estimated 1.8 mt in FY08, which is more compared to Apeda figures.

Oil slips below $47 on rising dollar, bleak economy

OIL prices slid more than 8% to around $46 a barrel on Monday, depressed by a rising US dollar and growing caution about the pace of any economic recovery and its impact on oil demand. US President Barack Obama said on Sunday the American economy remained under strain and his top economic adviser tempered hopes for a speedy recovery that have driven the stock market to successive gains.
    US light crude for May delivery was down $4.10, or 8.2%, at $46.23 a barrel by 21:30 pm locally. Brent crude for June fell $3.45 to $49.90.
    The dollar hit a one-month high against a basket of currencies on Monday. A rising dollar can limit the appeal of commodities and oil to some investors.
    President Obama said on Sunday the economy remained under strain, and his top economic adviser Paul Volcker said the country's recovery would be a 'long slog'.
    The head of the International Monetary Fund, Dominique Strauss-Kahn, said the agency would cut its global economic forecasts in the coming week. He expected a recovery to start in the first half of next year.
    Oil has fallen nearly $100 from its record high of over $147 last July, but has flattened out to trade around $50 for most of this month in part due to supply cuts by the Organisation of the Petroleum Exporting Countries. The International Energy Agency said on Monday it did not expect Opec to curb output again when it meets in May and did not see a recovery in oil demand until 2010.
    Some oil analysts see further price weakness through the northern hemisphere summer before the market recovers. BNP Paribas forecasts US light crude oil futures will drop to average just $35 per barrel in the second quarter of 2009, down from over $43 in the first quarter, before recovering to $45 in the third quarter and $58 in the fourth.

Nickel up on production cuts, investment buying

 PRICE of nickel, which is used in stainless steel, moved up by 16% this week against the previous week due to production cuts and investment buying. Nickel futures on London Metal Exchange (LME) closed up 16% at $12,725 per tonne after making a high of $12,844. On MCX, the April contract closed up 15% at Rs 633 per kg against last weeks’s close at Rs 550.8.
    Global production cut of the metal is expected to be 20% this year which is driving up the prices despite a weak demand from the steel industry. There has been over 33% increase of the LME inventories on a year-to-date basis that shows there is low demand for the metal. Nickel price also got support from the movement in global equities market. Results from Citigroup and General Electric were encouraging that supported the rally. Also, an upbeat turn in consumer confidence numbers eased investors worries about the slowdown in economies.
    According to base metals analyst Reena Walia from Angel Commodities, stainless steel producers account for around 64% of nickel offtake, and they are struggling with new orders which are at all time lows right now. “Severe production cuts have pulled out around 20% of nickel supply from the market and this is the real cause for the rise in prices rather than improvement in demand,” she said.
    She feels that prices could still receive support as a large number of nickel smelters have announced production cutbacks. “Short term trend in nicked looks bullish,” she said adding in the coming week, prices on the LME could trade in the range of $11,650-13,550 and the MCX April contract to trade in the range of Rs 580-675 per kg. Vibhuratan Dhara from Bonanza Commodity feels that prices will witness some correction in short term though the medium term outlook remains bullish.
    Earlier in the week Brazilian miner Vale, the world’s largest iron ore producer, said it would cut its global nickel output to adjust to weakening demand following slow growth in the world economy. The company has delayed the start-up of its nickel project in Brazil by at least one year, indicating that the demand is grim. Vale has also shut down its Sudbury nickel mines and processing plants in Ontario for eight weeks .

 

 

 

 

 

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Pulse prices hit the roof as imports fall short of target

Agencies Import 10 Lakh Tonne Against 15 Lakh Tonne

    INDIA’S pulse imports on government account is at least 30% short of the target in FY09, which traders say is a major factor for the current spiral in domestic prices.
    As the country needs to import about 30 lakh tonnes of pulses in a year to meet domestic demand, the government had set a target (for itself) of importing half of these in 2008-09. However, according to the latest official data, public sector trading firms — STC, MMTC and PEC — and agri co-operative Nafed contracted to import 10.3 lakh tonnes of pulses in 2008-09. These firms were asked by the government to import 15 lakh tonnes of pulses in 2007-08 also, out of which they had actually contracted for 13.51 lakh tonnes. The centre has been importing pulses through these PSUs and if they incur any loss in the process the government reimburse them.
    Traders and officials said the lower import was due to nonparity in domestic and global prices. “When the global prices were higher than domestic prices, it adversely impact on imports,” said KC Bhartiya, president, Pulses Importers Association of India. In 2008-09, the actual arrival of pulses was even lower at 8.1 lakh tonnes. Interestingly, these firms have disposed off 3.8 lakh tonnes of the imported pulses, which is less than 50% of the arrival.
    “Only PEC and STC have imported pigeon peas (tur) to the tune of about 85,000 tonnes in the entire year, while the other two agencies have not contracted any quantity,” a Delhi-based importer said. In 2007-08, these PSUs had imported about 1.3 lakh tonnes of tur, he added.
    Retail prices of tur have gone
up to Rs 58-60 a kg from Rs 50-52 per kg in the national capital in the past fortnight.
    Other pulses are also ruling high. Red lentil attracts Rs 54 a kg, green gram (moong) dal Rs 52-56 a kg, rajma (chitra) Rs 42 a kg, rajma (black) Rs 52 a kg, green peas Rs 35 per kg, kabuli chana Rs 42-46 a kg, chana dal Rs 32-34 per kg, yellow peas Rs 24 a kg and processed black matpe (urad) Rs 50-52 a kg.
    Lower production of tur in the country is also a factor in the rise in its price, the importer said.
    According to the agriculture ministry, tur production is estimated at 24.7 lakh tonnes in 2008-09, as against 30.8 lakh tonnes in the previous year. Both chana and tur production in the country have been affected, traders claimed. “It is actually lower than the government estimates,” an official with a trading firm said. Mr Bhartiya said India imports tur mainly from Myanmar, where the crop has been damaged leading to the price rise. One PSU is reported to have recently contracted tur at $700 a tonne from Myanmar, as against $425 in February this year. Some traders also said there is a spurt in global prices of pulses after government announcement of importing 15 lakh tonnes in 2009-10 financial year.
    Meanwhile, PEC had contracted to import 3.1 lakh tonnes of pulses, including 1.4 lakh tonnes of yellow peas (white matar) and 68,640 tonnes of tur in 2008-09. Out of these, 1.1 lakh tonnes have already been sold in the domestic market. STC had sold 1.7 lakh tonnes out of 3.1 lakh tonnes contracted. MMTC had contracted 1.9 lakh tonnes and sold 33,074 tonnes.

 

 

 

Now, nickel joins base metals rally

NICKEL, a laggard in last one month’s base metal rally, seems to have joined the other buoyant metal counters like copper and lead with a gain of 17% in the past 10 days.
    Currently trading at $12,500 per tonne at LME, nickel prices are up 25% from their early April lows. Domestic prices as reflected by June futures on MCX (Multi Commodity Exchange), stand at Rs 610 per kg, up 6% from Friday’s close of Rs 557.
    Analysts, however, attribute this gain to a break out of a range in the international prices since mid-February, with the rally in its counterparts like copper adding support. “Nickel has managed to pace up with the rally in metals like copper while a breach of $10,800 turned out to be a trigger for the rise,” said Navneet Mathur, research analyst, Anand Rathi Commodities.
    While all base metals including copper and lead, have experienced a significant rebound since Mid-February, it is interesting to note that nearly 90% of the total gain in nickel prices has happened in April.
    A number of nickel smelters have announced production shut down, but an expected decline in global steel demand continues to weigh on future nickel demand. According to China Iron and Steel Association, steel output in China, the largest producing nation, may drop by at least 8% this year.
    According to Praveen Singh, the stock levels in LME are very high for the price rally to gain a fundamental support. “It will be difficult for international prices to move past a strong resistance range of $12,100-12, 500,” he added. Currently, Nickel LME inventory stand at 105,264 tonnes, down 2% from a 13-and-a-halfyear high of 107,682 tonnes, reached on April 2.

 

 

 

 

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Maharashtra gives a big push to organic farming

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Federation Establishes A Network Of 2,000 Organic Farmers Through 120 NGOs; Farmers Too Find It A Low-Cost Method

Jayashree Bhosale PUNE

  ORGANIC farming is now a movement in Maharashtra, thanks to the few motivated individuals who acted as its advocates. Shriniwas Kulkarni was attracted to the idea of chemical free food, quit his career in an MNC to start a retail outlet, Organic and Naturals, in Pune. That was six years ago.
    “When I first heard of organic food, I visited a few people working in this area, including Vandana Shiva, the activist. Their work inspired me to take the plunge,” said Mr Kulkarni. His retail outlet selling organic food has recently achieved financial break even. “I was able to carry on the business for five years due to my long service in MNCs.
    “Now I have more than 1000 customers who regularly buy organic grocery,” he said, adding, “It is still a very niche market. Only the health conscious and NRIs come to us.”
    Social activist Vasudha Sardar was mulling the idea of making organic food available to all and was forced to take action when doctors advised her not to give any raw food to her husband, then at an advanced stage of blood cancer. “This was a turning point for me when I realised that food which is supposed to nourish has become a killer,” she said.
    Ms Sardar convinced a group of 15 farmers to start organic farming in Pargaon village, about 60 kms from Pune, where she owned some agricultural land. “A young farmer who ran a shop selling pesticides and fertilisers also supported us since he knew the dangers of the chemicals used in agriculture even better than we did. We started supplying vegetables and other food grains from June 2008 and today we have a dedicated customer base of 300 families in Pune,” she said.
    The Maharasthra Organic Farming Federation (MOFF) is an NGO established by former IPS officer Vikram Bokey. It has established a network of 2,000 organic farmers through 120 NGOs affiliated to it. “Organic farming is a low cost no debt option for these farmers,” said MOFF vice president Diliprao Deshmukh.
    These organic growers tend to supply directly to consumers or retailers thus cutting out the middlemen and avoiding the excessive handling of perishable commodities. It also helps in increasing the profitability of the venture.
    Growers like Ms Sardar try to sell the organic food at the ruling market rate of normal food items although organic food is costlier than the normal by 30% to 40%. Though the market potential of this business is huge, it is faced with the situation where the buyer does not know where to buy and the grower does not know how to sell.
    “Availability of sourcing reliable produce, that too consistently is the biggest problem,” said Mr Kulkarni. Pargaon, where Ms Sardar’s farming activity is located, is an irrigated sugarcane area where it is hard to convince farmers to turn to organic farming. In drought prone Vidarbha, it was relatively easier for Prasad Dev to motivate a number of farmers to go organic. He markets their organic produce on a commission basis. Yet Mr Dev complained, “Farmers are not inclined to produce quality organic food.”
    Certification is the answer to ensure quality and establish trust. But it is expensive. Interestingly, farmers are growing top quality organic food for export purposes. According to the Agricultural and Processed Food Products Export Development Authority (Apeda), the country’s apex body for the sector, India’s export of organic food grew by 30% in 2007-08 while the country has 1 million hectare of land under certified organic cultivation.
    jayashree.bhosale@timesgroup.com 

 

 

 

 

 

Gold melts on Re heat

Price Slips To Rs 14,305 From All-Time High Of Rs 15,705

WITH the equity market stealing the glitter, gold gave up its entire overnight gains in domestic markets on Thursday, eroding metal's appeal as an alternative mode of investment. Appreciation of rupee against the US dollar also dented gold's strength to some extent, dealers said.
    The fall was the steepest in Delhi market, where the price of standard gold plunged by Rs 350 as the metal settled lower at Rs 14,385 per 10 gm. While in Kolkata the precious metal was cheaper by Rs 145 at Rs 14,570 per 10 gm, it traded Rs 140 lower at Rs 14,375 per 10 gm in Chennai. In Mumbai, standard and pure gold dropped Rs 116 and Rs 115 to Rs 14,305 and Rs 14,370 per 10 gm, respectively.
    However, the fall wasn't attractive enough to bring in buyers to stores. In fact, source said, customers continued to encash their old ornaments. According to traders buying could start if the prices fall by another Rs 1,000 a gm. "If prices fall below Rs 13,000 per 10 gm in domestic markets physical buying may gain momentum," said Prakash Jain, a leading bullion merchant in south Mumbai's Zaveri Bazar.
    Meanwhile, bullion dealers started importing in small quantities after a gap of nearly two months, sources said. Dealers expect a revival of demand for gold jewelleries during weddings season which will begin later this month.
    With Thursday's fall, gold has become cheaper by nearly Rs 1,400 per 10 gm, down nearly 9% from its life-time high of Rs 15,705 touched on February 21 this year.
    In international markets, US gold for April delivery eased by $7.80 an ounce at $876.90 as stock markets extended gains in Europe and stock futures in the US moved up after Wells Fargo said it expected better first quarter earnings. In London, spot gold fell to $887.20/878.55 an ounce from Wednesday's New York close of $879.55.
    Silver also recorded a hefty fall on Thursday in the absence of any trigger. Delhi markets saw the biggest fall, where ready silver (.999) plummeted by Rs 230 to Rs 20,700 per kg. While in Kolkata, the white metal lost Rs 100 to Rs 21,100 per kg, the spot silver recorded a loss of 65 at Rs 21,470 per kg in Chennai. Mumbai markets recorded a marginal loss of Rs 20 to Rs 21,125 per kg.
    indra.bhadra@timesgroup.com 

Lower output may not hit sugar prices

High Inventories Likely To Keep Prices Stable; Sugar Stocks Rally As ISMA Revises Production Figures Downward

DESPITE an estimated fall in sugar production in the year to September 2009, carry-forward stocks and demand elasticity would ensure availability of the sweetener at reasonable prices, according to a senior industry body official.
    "Normally there should be a growth of 4-5% in demand every year. But this could be affected due to demand elasticity," SL Jain, director general, Indian Sugar Mills Association (ISMA), said.
    On Wednesday, stocks on BSE sugar counter rallied between 4% and 20% following a downward revision by ISMA of sugar production estimates to 14.2 million tonnes from 15 mt in the current sugar year (October-September). Sugar production in the current year is expected to be lower by over 45% than the 26.4 mt recorded in the previous year.
    According to Alex Mathews, head of research, Geojit Financial Services, sugar stocks rallied on news that sugar mills would benefit by way of higher realisation following the drop in sugar production. "Stocks surged on short covering and fresh buying," Mr Mathews said.
    However, Mr Jain said that with carry-forward stocks of 8 mt, 22.2 mt of sugar could be available against expected demand of 20.5 million tonne. It was close to 21 million tonne the year-ago period.
    Mr Jain, who is also chief executive of Indian Confectionery Manufacturer's Association, said that confectioners' demand for sugar had dipped following a reduction in offtake of candies which had become more costly.
    Futures contracts on the local commodity bourse also reflected the sentiment on the stock counter. On Wednesday, the April contract on NCDEX platform closed 1% higher from its previous close of Rs 2,189 per 100 kg.
    According to research analyst Lopa Sanghvi from Anand Rathi Commodities, the outlook appears bullish with a target of Rs 2,500-Rs 2,600 by August end. "But with elections round the corner, the government will not let the prices to move very high so this month they could move in a range between Rs 2,100-Rs 2,200," she added.
    nidhi.sharma1@timesgroup.com 

Gold gets glitter back, rises to Rs 14,421 in Mumbai

GOLD bounced back in the domestic markets on Wednesday on the back of reports that the yellow metal would soon regain the psychologically important $1,000 an ounce in overseas market and volatility in stock markets.
    On Wednesday, the price of yellow metal surged by an impressive Rs 315 to close at Rs 14,735 per 10 gm in Delhi. While in Kolkata the metal shot up by Rs 265 before closing the business at Rs 14,715 per 10 gm, it traded Rs 151 higher at Rs 14,421 per 10 gm in Mumbai.
    However, demand for gold jewellery dropped sharply on Wednesday on rising prices, a reversal from the healthy offtake seen in the past week. "Some consumers returned to market in the past week as prices were affordable to them," said a bullion merchant in south Mumbai. "But stayed away from purchase as prices have jumped," he added. Dealers said any price correction could revive demand again due to festivals and weddings later in the month.
    Meanwhile, global metal consultancy GFMS in a report said that gold prices are expected to rise by over 25% to touch $1,100 an ounce after summer as sustained concern over global economy will prompt investors to shift to the safehaven status of the precious metal.
    Commodity experts, however, said gold prices may decline to Rs 13,000-level in the domestic markets by June if rupee remains resilient against the greenback. Dollar denominated gold gets cheaper when the local currency gains against the dollar. The domestic currency has been ruling in the range of 50-mark against the dollar. A weak rupee makes the dollar-quoted gold expensive
    "Gold prices have started falling from the record highs in February. The bearish trend is expected to continue, pulling prices further down to Rs 13,000 per 10 gm by June-end," brokerage firm Karvy Comtrade Harish G said on Wednesday.
    It was echoed by Bombay Bullion Association president Suresh Hundia. According to him, "prices may decline to Rs 13,500 per 10 gm by April-end. If rupee remains stronger against the dollar, then gold rates may fall up to Rs 13,000 per 10 gm by June."
    However, bullion dealers said gold gained support as some investors shifted their funds from volatile stock markets to bullion as safe haven. The stock markets moved up and down in the range of nearly 3% on Wednesday.
    In domestic futures, the benchmark June gold contract extended gains for second day and was last traded 0.8% higher at Rs 14,408 per 10 gm at 2:25 pm locally, after touching as high as Rs 14,465. In international markets, gold moved higher again on Wednesday after reversing initial gains as appetite for risk fluctuated, reflecting volatility on world equity markets. In London, spot gold was quoted at $886.45/887.45 an ounce by 21:50 pm locally from Tuesday's New York close of $880.05. US gold futures for April delivery on the Comex division of the New York Mercantile Exchange rose $5.10 to $887.30 an ounce.

Refined sugar import at zero duty unlikely

INDIA may not allow import of refined sugar at zero duty before the general elections in April and May, said Union commerce secretary G K Pillai. The issue was not taken up by the Union Cabinet in its last meeting on Monday.
    "The issue is before the Cabinet. It was not taken up in the last meeting. I don't think any thing will happen before (the) elections," Mr Pillai told reporters at a function of the Indo-American Chamber of Commerce on Saturday. Refined sugar attracts an import duty of 60%.
    The government needs to take the approval of the Election Commission before announcing any such measure even after the Cabinet decides on the issue. The government had recently allowed sugar mills to import raw sugar at zero duty till September this year for sale in the domestic market. These imports would be under advance licence scheme and on 'tonne-to-tonne' basis, which means that mills would have to export the same quantity later.
    Sugar prices in the domestic market have risen by up to 30% since October last year as production is estimated to fall to 160 lakh tonnes in 2008-09 season (October-September) from 264 lakh tonnes in the previous year. The government was expected to bring down import duties on refined sugar to zero as it would not want prices to go up during the general elections.