Improving exports demand hike in prices of oil and guar gum
Improving export demand for guar gum and hike in oil prices have made Guar seed to future trade on a positive side in June. Besides this, the third advance estimates by the state agriculture department to reduce the production of guar in Rajasthan has supported the commodity to maintain its price in the commodity market this month.
“The most active guar seed July delivery contract on National Derivatives and Commodity Exchange (NCDEX) jumps more than 6 per cent in a week to touch two-month high”, says one of our sources.
The year 2018 has been a great hit for this commodity as Guar has reached three years high in 2018, and the reason behind this being increase in export demand for guar gum to the US and a positive increase in crude oil prices as well.
One of the other reasons behind increased export of guar is weaker rupee which has made makes imports cheaper for foreign importers. The top guar gum export destination from India is the US, Norway, Russia, China, and Germany.
According to the latest data released by the Agricultural and Processed Food Products Export Development Authority (APEDA), “during the first five months of 2018 ie from Jan to may, exports are down by 11% at 95,652 tonnes, against 251,880 tonnes in the year-ago period amid higher guar gum prices compared to last year. Whereas in may guar gum exports in India were increased up to 4 per cent on year to 55,247 in. As a result of which May guar gum export volume was the largest since March last year”.
Though Rajasthan being the largest guar seed producer in the country and guar seed prices depend upon the monsoon rains for the state of Rajasthan.
As per the data from Indian Meteorological Department (IMD), “ In the month of June “western Rajasthan has received 28.3 mm of rainfall, 7 percent above the normal weighted average of 28.3 mm for the period while rainfall distribution in top guar producing districts in Rajasthan viz Bikaner, Jaisalmer, Barmer, Hanumangarh and Sri Ganganagar has been above normal in June except for Barmer”.
According to Indian Meteorological Department, though there is enough of rains in this month still people are scared of insufficient rainfall in northwestern regions during August according to the long-range forecast for 2018 monsoon.