Jeera Gains on Reports of Decline in Sowing Area and Improving Domestic Demand

Jeera yesterday settled up by 1.23% at 21000 on reports of a decline in sowing area and improving domestic demand. In 2021-22, the area under cumin in Gujarat is only 3.07 lakh hectares as against 4.69 lakh hectares in the same period last year and production is expected to decline by 41% to 2.37 lakh tonnes as compared to last year's 4 lakh tonnes as per second advance estimates. In Rajasthan too, there has been a decline of about 30% in the area. According to government data, cumin exports declined by 24% year-on-year to 1.74 lakh tonnes in April-December from 2.30 lakh tonnes in the previous year. However, export demand will still be under pressure due to tariff costs and ahead of arrival despite the news that China export started again.
 
The export of cumin seeds declined by 20% year-on-year to 1.61 lakh tonnes in April-November, from 2.02 lakh tonnes in the previous year. There is a possibility of damage to the cumin crop due to rain and cloudy sky. The production in Syria had fallen by roughly 25-30 percent in 2021, versus the previous year because of political instability. The cropped area has fallen due to a shift towards other crops like Cotton, Soybean, and Mustard, which offered lucrative returns last year. The export of cumin is increasing continuously and in the coming days, the export sales are expected to continue with greater quantity. In Unjha, a key spot market in Gujarat, jeera edged down by -18.75 Rupees to end at 19981.25 Rupees per 100 kg.  
 
Technically market is under short covering as the market has witnessed a drop in open interest by -0.52% to settled at 10365 while prices up 255 rupees, now Jeera is getting support at 20720 and below same could see a test of 20445 levels, and resistance is now likely to be seen at 21170, a move above could see prices testing 21345.  

Trading Ideas:
# Jeera's trading range for the day is 20445-21345.
# Jeera prices rallied on reports of a decline in sowing area and improving domestic demand.
# In 2021-22, the area under cumin in Gujarat is only 3.07 lakh hectares as against 4.69 lakh hectares in the same period last year
# In Rajasthan too, there has been a decline of about 30% in the area.
# In Unjha, a key spot market in Gujarat, jeera edged down by -18.75 Rupees to end at 19981.25 Rupees per 100 kg