Jeera February contract dropped Rs 305 and settled at Rs 14440 per quintal due to expectations of higher production in 2012 on a rise in area under cultivation top producer Gujarat state. Production is expected to increase by 15-20 percent this year due to higher area and good weather. Traders expect fresh supplies from the new season crop to further weigh on prices. Jeera is cultivated during winter from October to December and harvesting starts from February. Latest sowing data from Gujarat indicates as on 27th Dec, sowing completed in ~2.82 lakh ha vs 2.38 lakh ha last year. As per Rajasthan Agricultural Minis-try, the sowing area till 20th Dec had been reported at 3.03 lakh ha vs 3.30 lakh ha same period last year. Productivity of crops in both states however expected to fall due to adverse weather conditions as per reports. The better crop expectations from Gujarat and Rajasthan could be hampered by reports of adverse weather conditions in growing areas that could affect the productivity to some extent as per traders. The total arrivals of jeera jumped to Rs 5,000 bags from 4,000 bags on Tuesday. In Unjha, a key spot market in Gujarat, jeera dropped -64.7 rupees to end at 15300 rupees per 100 kg. The contract made intraday low of Rs 14390 a kg and high of Rs 14865 a kg. Support for jeera is at 14265 below that could see a test of 14090. Resistance is now seen at 14740 above that could see a resistance of 15040.

Trading Ideas:

Jeera trading range is 14090-15040.

Jeera ended down due to expectations of higher production in 2012 on a rise in area under cultivation

Production is expected to increase by 15-20 percent this year due to higher area and good weather

NCDEX accredited warehouses jeera stocks gained by 46 tonnes to 7378 tonnes.

In Unjha, a key spot market in Gujarat, jeera dropped -64.7 rupees to end at 15300 rupees per 100 kg.