Indian sugar, soy and wheat futures dropped on Monday after the arrival of annual monsoon ahead of schedule in the south-western coast and showers in some oilseed growing regions.
The June wheat contract on the National Commodities and Derivatives Exchange (NCDEX) had dropped 4 rupees to 881. At the Multi Commodity Exchange (MCX), the June contract was down 2.20 rupees at 883.50.
"The arrival of the monsoon has affected market sentiment," said a broker based in western India. "The monsoon's progress will dictate the prices now."
India's four-month south-western monsoon hit the coast of Karen on Friday, six days in advance, raising prospects for farm output that mainly depend on rains for irrigation.
Traders said wheat prices had dropped following a government announcement that supplies of 400,000 tonnes of wheat from Australia, which were held up on quality issues, would arrive in four to five weeks.
Soyaoil futures dipped on scattered pre-monsoon showers in some of the oilseed growing regions in Madly Pradesh, which accounts for the bulk of the country's soybean output. Traders said arrival of the rains would lead to timely sowing operations.
The June soy oil contract at the Multi Commodity Exchange was down 1.40 rupees at 416.40 per 10 kg. At the NCDEX the June contract was 1.60 rupees lower at 416.40. Sugar futures fell on reports that the government has released an additional 200,000 tonnes of sugar in the markets in Maharashtra and the southern states to stabilise prices.
"The supplies of sugar have increased and rains would also lead to lesser consumption of soft drinks," said one dealer. The June sugar contract on the NCDEX was down 17 rupees at 1,972 per 100 kg while at the MCX the June contract was lower by a similar margin at 1,985 rupees.
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