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An official advisory committee headed by Dr C. Rangarajan, Chairman, Prime Minister's Economic Advisory Council, has interalia recommended removal of levy obligation on sugar mills, according to a latest update from the Ministry of Consumer Affairs, Food & Public Distribution. The Committee has further recommended that the states, which want to provide sugar under PDS, may henceforth procure it from the market directly according to their requirement and may also fix the issue price. The recommendations of the Committee are under consideration of the Government. Some cane farmers have supported the proposal. The views of State Governments on this matter have been invited, the update concludes.

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Selling is likely to continue in mustard seed in the near term on the heels of weak export demand of mustard meal during the October month along with strong mustard seed arrivals in major mandies. The NCDEX mustard seed futures plummeted by more than Rs 30 per quintal in the last trading.
As per latest data compiled by Solvent Extractors' Association of India, the total exports of oilmeals for the month of October 2012 were reported at 39,058 tonnes, down 56.50% from the last year in the same period.
Moreover, strong mustard seed arrivals in physical mandies also added some selling pressure in futures market. The total arrivals of mustard seed increased by 7000 bags to 80000 bags in major mandies in the last trading, while the spot prices of mustard seed were quoting at around Rs 4455-4460 per quintal at Jaipur mandi, Rs 4200 per quintal at Kota, Rs 4425 per quintal at Hapur and Rs 4350 per quintal at Bikaner mandi. The spot prices of mustard seed declined by almost Rs 30-40 per quintal in all major mandies.
Consequently, the future prices of Mustard seed NCDEX December Benchmark contract declined by Rs 32 per quintal to close at Rs 4235 per quintal in the last trading. The contract added almost 1000 positions in open interest indicating fresh short position by speculators at higher levels. Technically, resistances are likely at around Rs 4255-4260 per quintal while supports are likely at Rs 4200-4205 per quintal in the short term.

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The MCX Silver futures broke above Rs 61000 per kg levels today as a good amount of fresh buying helped the metal amid mostly positive movement in global risky assets. The US dollar slipped as US Congressional leaders met with President Barack Obama on Friday and said they would work to find common ground on taxes and spending. This boosted hopes that the world's largest economy would be successfully able to combat with the looming "fiscal cliff". Gains in other industrial commodities like Copper and Crude oil also boosted the metal. COMEX Silver futures are trading at $32.60, up 2.3 cents or 0.73% on the day.

Silver futures extended a downward run from its highs near $35 per ounce achieved in the first week of October 2012. LME Copper tested its two-month lows and kept Silver in tight ranges. Silver is linked directly to industrial activity and safe haven demand and a drop in copper is normally supposed to have a negative influence on the white metal. The commodity tested its two-month lows near $30 per ounce and closed at $32.37, up nearly 5% on the fortnight. The prices have been locked in a broad range of $30-35 per ounce over last few days and a break on the either side is needed for further direction.

Precious metals consultancy GFMS estimates that industrial demand for silver fell 6% in 2012, driven by weak economic growth in developed countries. Manufacturers continued to find ways to substitute cheaper raw materials in place of silver. Meanwhile, consumers have cut purchases of silverware and shifted away from costly precious metals in their jewelry purchases. The trend was partially offset by rising sales in emerging markets, particularly China, GFMS said. While the industrial demand dropped, silver mine supply rose for the 10th consecutive year in 2012, and is expected to total 797.0 million ounces, up 4.3% from 763.8 million ounces in 2011, according to the consultancy.

The white metal had neared $32.30 per ounce levels earlier in the session but edged up quite impressively thereafter, adding one full dollar during the day. The Asian equities added good gains following a near 1.5% surge in Japanese stocks while the European stocks are also up by nearly 1%. MCX Silver futures are trading at Rs 61038, up Rs 168 or 0.26% on the day. The open interest in the counter is up nearly 4% - indicating fresh buying.

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Forward Market Commission asked National Commodity & Derivatives Exchange (NCDEX) to restart the procurement of pepper. National Commodity & Derivatives Exchange Ltd (NCDEX) on Wednesday said it has asked its Kochi warehouse service provider not to accept fresh deposits of pepper following complaints of inferior quality being deposited by several physical players. Market sources estimated the quantity of such pepper deposited by the syndicate of several physical participants to the tune of 2,000-2,500 MTs aggregating around Rs 100 crore.

NCDEX - Chilli arrivals steady in Guntur mandi

Chilli 334 prices were quoting at Rs 5,200-5,500 per quintal in the Guntur spot market. The total arrivals stood steady at 40,000 bags (5,000 bags of  Khammam teja).

Mandi	Variety	Prices (Rs per quintal)	changes from previous day
Guntur (Andhra Pradesh)	334	5200-5500	Steady
	Teza New	7500-7800	Steady
	Khammam Teja	7800	Steady
	No- 341	6200-6500	Steady
	No-5	6000-6200	Steady

The NCDEX Chilli December contract moved in the range of  Rs 5,128-5,202 and is currently trading at Rs 5,146 per quintal, down by Rs 86 or 1.64% per quintal.

NCDEX Potato Tips

Potato arrivals in the Azadpur mandi in the state of Delhi stood at 125 trucks (120 trucks as on 31st October 2012). Among the varieties, Punjab quoted steady in the range of Rs 850-900 per quintal, while new crop from UP quoted steady in the range of Rs 750-800 per quintal.

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 Sugar prices on the Vashi market showed a mixed trend on Wednesday (31 October 2012). Prices in spot ruled steady on routine demand - supply while at naka level it improved by Rs 5 for M grade and declined by Rs 10-15 for S grade. Mill tender rates rose by Rs 10-15 on higher festival demand and firm futures markets.

According to the Bombay Sugar Merchants Association, the spot sugar rates were: S-grade Rs 3,492-3,561 (Rs 3,492-3,561) and M-grade Rs 3,552-3,701 (Rs 3,550- 3,701). Naka delivery rates were: S-grade Rs 3,440-3,480 (Rs 3,450-3,500) and M-grade Rs 3,500-3,650 (Rs 3,500-3,650).