Ref. Soyaoil on NCDEX settled down by -0.18% at 654.8 due to weak physical demand and higher production estimates of soyoil. The production of edible oil in 2016/17 will be 72.8 lt, up 25.5% compared to last year. Last year, edible oil production was at 58 lt. The tariff value of crude soyoil was cut by $32 per tonnes to $847 for the second fortnight of February. According to data released by the SEA, soy oil imports fell nearly 62% on year to 1.67 lt mt in January. On the domestic front, the availability of more domestic soya oil on the back of ample soyabean supplies is dragging down the prices of soya oil derivatives. As per USDA, in 2016-17, soya oil production in India is expected to be around 1.62 million tonnes (mt), up 55 per cent from the previous year. Moreover the overall supplies are seen rising by 2 per cent compared to last year. However, the imports of soya oil are likely to decline by 11 per cent to 3.8 mt. The carryover stock from 2015-16 is estimated to be around 0.531 mt, which is the highest till date. Meanwhile, the landed cost of imported soya oil is also seen declining on the back of the ongoing harvest in South America. Agriculture Ministry in its second advance estimate for 2016-17 oilseed production pegged soybean output at 14.1 million tons compared to market's expectation of 11.4-11.5 million tons. At the Indore spot market in Madhya Pradesh, soyoil was steady at 665 Rupees per 10 kgs. Technically now Ref. Soya oil is getting support at 651 and below same could see a test of 647 level, And resistance is now likely to be seen at 658, a move above could see prices testing 661.

Trading Ideas:

# Ref. Soya oil trading range for the day is 647-661.

# Ref soyoil prices ended with losses due to weak physical demand and higher production estimates of soyoil.

# The production of edible oil in 2016/17 will be 72.8 lt, up 25.5% compared to last year.

# According to data released by the SEA, soy oil imports fell nearly 62% on year to 1.67 lt mt in January.

# At the Indore spot market in Madhya Pradesh, soyoil was steady at 665 Rupees per 10 kgs.