Chana under short covering; Support seen at 4519

Chana market is under short covering as market has witnessed drop in open interest by 0.44% to settled at 36180 while prices up 144 rupees.

Chana is getting support at 4519 and below same could see a test of 4412 level, And resistance is now likely to be seen at 4693, a move above could see prices testing 4760.

Chana on NCDEX settled up by 3.21% at 4627 tracking firmness in spot demand due to fall in acreage this year. The total availability of stock with the agency was 700,000-750,000.  Nafed sold 66,710 tons of gram in Andhra Pradesh while in Telangana the agency sold 35,712 tons.Chana output is expected to fall this year in the key growing state of Rajasthan.

Chana acreage is anticipated to fall this season due to drought like situation in major producing states such as Madhya Pradesh and Rajasthan. Rajasthan has sown gram on 1.2961 million hectare as on Dec 4 compared to 1.3956 million hectare in the same period a year ago, according State’s Agriculture data.

Chana acreage in Gujarat was reported at 130,604 hectare as on Dec 3 compared to 247,600 hectare in the corresponding period last year, according to State’s Agriculture Department report.  According to Department of Agriculture Co-operation and Farmers Welfare data, as on Nov 30 chickpea was sown on 7.046 million hectare compared to 8.302 million hectare in the same period last year.

Meanwhile, stocks of chana in physical market are lower as government extended the import restriction till December. The government raised the import duty to 60% from 40% on chana in March this year to restrict cheaper imports and to help farmers following a record harvest.

Trading Ideas:
–Chana trading range for the day is 4412-4760.
–Chana gained tracking firmness in spot demand due to fall in acreage this year.
–The total availability of stock with the agency was 700,000-750,000.
–NCDEX accredited warehouses Chana stocks gained by 405 tonnes to 13000 tonnes.
–In Delhi spot market, chana gained  by 9.15 Rupees to end at 4459.15 Rupees per 100 kgs.

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