Should I buy Chana ( pulses ) , since monsoon is poor means low production ?

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About rajumohan

Author is Real Estate and Stock Investor located in Chennai India. Raju is investing Indian capital markets for past 9 years and manages more than 20 Cr of personal finances.

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I did some research on Chana here is part of it.

Chana is major pulse crop in the Indian subcontinent It is well known for rich protein content, chana is used as an edible seed as well as making flour.

There are two types of chana:

1. Kabuli
2. Desi

The Indian chana production is estimated to be between 4-7 million tons per year. Normally chana accounts for around 40 percent of India’s total pulses crop production of 12-15 million tons. Major producing states are Madhya Pradesh, Uttar Pradesh, Rajasthan and Maharashtra.

Chana can withstand moisture stress to a certain extent. However, the production highly fluctuates between years, depending on the rains received and the moisture availability in the soil.

Factors affecting chana prices :

1. Demand and Supply ( output )
2. Previous years carry over stocks ( usually MMTC has this )
3. imports and govt policies.

Chana is produced in
MP (18 lakh tons ),
Rajasthan (11 lak tons ) ,
UP 5 (lakh tons),
Maharashtra 7 (lakh tons) ,
AP 4 (lakh tons ) ,
Karnataka 3 (lakh tons )
Gujarat 2 (lakh tons)
---------------------
total ==> 50 lak tons

Indian consumption is 50-55 lakh tons which fluctuates with the price movement.

As you can see we are not in short fall of around 3 to 5 lakh tons .India imports around 300,000-400,000 ton chana per year from Canada, Australia, Iran and Myanmar.

Its sowing starts in October and lasts till December. First arrival starts in Karnataka during Nov end while the last arrival in North Rajasthan is during April.

- Rainfall pattern and temperature
- sowing area covered
- Demand
- Production in the International markets.
- supply of other pulses namely Urad and Tur
- Import and export policies by the Indian Govt.

As we see more then 50% of chana come from MP and Rajasthan , that means any shortfall in rain in these states can create huge supply demand gap.

Current rain fall in MP and UP :

Current chana prices:
MCX chanadal futures December expiry are at 2590. (100kg )

 

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