MUMBAI (Commoditiescontrol) – Mustard seed traded mostly flat during the week ended Oct 13 due to limited demand from crushers amid slow offtake in mustard oil and weak cues from futures.
Mustard seed daily arrivals in the country during the week averaged around 1.58 lakh bags (85kg each) versus 2.05 lakh bags a week ago.
Mustard seed at the benchmark Jaipur market was flat at Rs 4,245/100kg, while mustard oil this week slipped 0.6% at Rs 843/10kg with mustard cake unchanged at Rs 1,960/100kg.
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Mustard seed prices were pressured mainly by poor crushers' demand due to slow sales in mustard oil. The consumer demand has mainly shifted to cheap palm oil and soy oil.
Many small and medium crushing plants have either shut their daily operations or doing need-based work, not only due to poor sales, but also due to liquidity crunch.
According to crushers, “The last few months were very tough for mustard processors as demand has been very poor from consumption centres. Slow payment by stockists has led to liquidity crunch with crushers and so they are now doing need-based production of mustard oil.”
Nafed has so far liquidated around 50,000 tonnes of mustard seed from total procured quantity of 8.80 lakh tonnes during rabi 2017-18.
Nafed is selling mustard seed between Rs 3,900-3750-3,700, depending on quality.
The most-active November mustard seed futures dropped this week by nearly 1% at 4,162/100kg on the National Commodity & Derivatives Exchange Ltd (NCDEX). The contract during the week hovered between Rs 4,127 to 4,208.
Volume in mustard seed futures was mostly on the lower side with open interest rising along with bearish tone in prices, indicating some short covering likely at lower levels.
Conclusion: Mustard price is likely to remain steady to weak next week and ong term outlook will depend on rabi mustard sowing as oilseed stock is now sufficient to cater demand for the remaining season.
(By Commoditiescontrol Bureau; +91-22-40015533)
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