Agricultural commodities such as soyabean and chana registered a higher growth rate in trade values than bullion on the commodity exchanges in the first half of the current fiscal.
The total trade value of agricultural commodities increased 31 per cent on exchanges till September 15 over corresponding period a year ago. During the same period, the exchange traded value of bullion and precious metals such as gold, silver and platinum decreased 26.33 per cent, according to data from the Forward Market Commission (FMC).
Prices of agricultural commodities led by soyabean and chana have been surging since April this year. Though gold and silver have also increased, the rise has been slower than soya and chana.
Chana futures rose 26.5 per cent between April 2 and September 15, while soyabean prices were up 20.6 per cent for the period. Gold and silver futures increased only by 14 and 11.6 per cent, respectively.
Industry analysts see a strong possibility of funds for equity that had flowed into the bullion could have reversed their direction to the equity markets. Such a trend could have affected the bullion volumes.
“Volatility in agri-commodity prices has led to the rise in volumes and traded value. The trend is unlikely to continue as prices of agri-commodity have softened in the past one month, while gold and silver has moved up,” said Ashok Mittal, CEO of Emkay Commtrade.
Volumes
According to the data available till August, bullion volumes have shrunk by 36 per cent while that of agri-commodities have seen a 10 per cent jump. Gold volumes shrunk 17 per cent in April-August period, while silver was down 36 per cent. Soyabean volumes doubled to 318.57 lakh tonnes during the period, while soyabean oil was up 53.4 per cent. However, the traded volumes in chana were down 44 per cent at 194.81 lakh tonnes from 348.17 lakh tonnes in corresponding period.
Sources in the MCX attributed the decline in gold and silver volumes to a largely stable trend in bullion prices.
The other agri-commodities that registered a rise in volumes and prices include rapeseed/mustard, castorseed, cottonseed cake, turmeric, wheat, coffee, barley and crude palm oil.
The sustained rally in agri-commodities in the past six months was largely in line with the global trend, though the prices have weakened off-late on harvest pressures.