According to provisional data, global refined lead supply exceeded demand by 35kt from January to October 2016. World mine production decreased 7.8% due to lower output in Australia, China, and India. Refined lead output fell 1.1% globally, with increases in Australia, Kazakhstan, South Korea, and the US offsetting a sharp drop in China. Lead imports to China fell 22.4% in the first ten months of 2015. The LME lead price has broken out of its falling channel pattern and taken support at technical levels, suggesting a medium-term bullish trend.

1. News and Developments
Acording to provisional data reported by International Lead and Zinc Study Group (ILZSG) indicate that world refined
lead metal supply exceeded demand by 35kilo ton during the period January to October 2016. Over the same period
total reported stock levels increased by 38kt. A decrease in global lead mine production of 7.8% compared to the first
ten months of 2015 was primarily a result of lower output in Australia, China and India.
A sharp fall in Chinese refined lead metal output was
partially balanced by increases in Australia, Kazakhstan,
the Republic of Korea and the United States resulting in
an overall global reduction of 1.1%. Usage of refined lead
metal increased by a robust 9.8% in Europe driven
mainly by increases in Germany, Italy, Poland and the
United Kingdom. In China, apparent demand fell by 9.8%
and in the United States, remained flat.
Chinese imports of lead contained in lead concentrates
totaled 614kt, a reduction of 22.4% compared to the first
ten months of 2015.
Technical Outlook
LME Lead price has given breakout of its “Falling Channel Pattern” at $2000 levels on weekly chart and price has
retested its breakout trend line at $1966 levels. Moreover, MCX Lead price has taken support of its “Horizntal Trend
Line” at Rs.132.6 levels on daily chart. Further more, on weekly chart LME Lead price have taken support at 61.80%
Fibonacci Retrcement of its prevoius upmove from its $1551.50 to $2571.75 levels. In addition, LME Lead prices have
been trading above its 200 weekly exponential moving average which suggest medium term trend will remain bullish.
A Momentum Indicator RSI has shown bullish range shift on weekly time frame, which hint towards bullishness in the
prices. For medium term prospective, one can initiate long position in MCX Lead (Feb) at CMP Rs.151.60 or on dips in
prices till Rs. 146 levels can be used as buying opportunity for the upside target of Rs.166. However, reversal in the
bullish view can be seen if Lead prices breaks the support of Rs.140. Overall, we maintain our bullish view in Lead for
one to two months.
11th
January, 2017
LEAD
Commodity Insight
SEBI Registered - Research Analyst Equities I Commodities I Currencies I Mutual Funds

2. News and Developments
According to government sources, Indian wheat
production next in 2017-18, is estimated at 98.9m
tonnes, thanks to higher planted area. Return of normal
monsoon, adequate soil moisture, record high prices
and expected profitability indicate record-breaking
wheat plantings of 32.0m hectares. The estimate is still
more than 10m tonnes above the past two year's final
production when weak monsoons and unseasonal rain
affected wheat yields substantially. There are drought
problems in Punjab and Haryana, in India's northwest
due to recent warm and dry weather.
Production is still very dependent on weather conditions in coming months. Favourably cool condition during yield
formation could raise production to as much as 105.8m tonnes. Alternatively, hot temperatures during January through
March could lower wheat production to 93.5m tons.
Russian production is forecast to fall back from this season's record production, despite "increased plantings, current
high soil moisture and likelihood of a mild winter". Russian winter wheat plantings at around 13.9m hectares, up some
200,000 hectares year on year. But spring wheat plantings were seen slightly lower year-on-year, at 13.4m hectares,
"due to cultivation trends and less favourable gross revenue for spring wheat".
Technical Outlook
On weekly chart, the NCDEX Wheat February has given breakout of its “Rising Channel Pattern” at Rs.1860 levels and
price has retested its breakout trend line at Rs.1850 levels. On the other hand, NCDEX Wheat prices have been trading
above its 50 weekly exponential moving average which suggest short term trend will remain bullish. Further more, on
weekly chart NCDEX Wheat price have taken support at 50% Fibonacci Retrcement of its prevoius upmove from its
Rs.1535 to Rs.2161 levels. A Momentum Indicator RSI has taken support of its rising trend line at 50 levels on weekly
time frame, which suggest further upside momentum can be seen in the prices. Moreover, prices have been facing
resistance of its Rising Trend line at Rs.2050 levels on daily chart. As the NCDEX Wheat prices looks positive, one can
initiate long position in NCDEX Wheat (Feb) at CMP Rs.1895 or on dips in prices till Rs. 1840 levels can be used as
buying opportunity for the upside target of Rs 2200 levels with a stop loss to be kept around Rs.1750 levels. Overall, we
hold our bullish view in Wheat for next two to three months.
WHEAT
11th
January, 2017
SEBI Registered - Research Analyst Equities I Commodities I Currencies I Mutual Funds
Commodity Insight

3. LME Lead Inventories
Crop Calendar
Commodity Country January February March April May June July August September October November December
China
India
USA
Australia
Sowing
Growth
Harvesting/Arrivals
Wheat
Commodity LTP WoW (%) MoM (%) Open Interest
(Weekly)
LME Lead ($/tonne) 2189 1.98 -14.75 -320
Shanghai Lead
($/tonne)
18620 2.0 -18.20 -2120
MCX Lead (Rs./kg) 151.0 4.62 -15.41 1181
CBOT Wheat ($/bu) 424 6.12 1.49 -0.005 M
NCDEX Wheat
(Rs./quintal)
1895 -0.26 -5.43 1840
SEBI Registered - Research Analyst Equities I Commodities I Currencies I Mutual Funds
Commodity Insight
11th
January, 2017
Source: Bloomberg

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Commodity Insight
11th
January, 2017
SEBI Registered - Research Analyst Equities I Commodities I Currencies I Mutual Funds
www.choicebroking.in
Anish Vyas
Digitally signed by Anish Vyas
DN: cn=Anish Vyas, o=Choice Merchandise
Broking Pvt. Ltd, ou=Sr. Research Associate,
email=anish.vyas@choiceindia.com, c=IN
Date: 2017.01.11 15:36:27 +05'30'