Jaipur (Commoditiescontrol) –Guar seed and guar gum witnessed bearish trend last week as prices fell to Rs. 3550/100 and 6300/100kg respectively and further pressures is expected amid smooth supply and muted demand.
Speculative trading led volatility in prices as regular upper and lower circuit witnessed at National Commodity and Derivatives Exchange Ltd (NCDEX). Even, there was no stability in prices in the physical market. Guar seed prices have been moving between 3400-3800. By The commodity was priced at Rs 3550/100 kg at Jodhpur this week. However, downtrend is consistently observed in the prices of guar seed and guar gum.
Guar Seed Acreage Shrinks
Guar cultivation area has hugely dropped in high productive area of Haryana, Ganganagar and Hanumangarh. It has largely replaced by another crops in productive belt of Jhunjhunu Sikar and Alwar.
Hardly 3%-4% area is under guar seed in these districts. In Churu district it is around 5 % of total cultivation area. Nagaur Jodhpur and Bikaner districts it is around 15-20%. It is below 40 % in Jaisalmer and Barmer.
Major production will come from the low productive area of guar such as: Bikaner, Jaisalmer, Jodhpur and Barmer. Size of land holding is big in this belt but productivity of soil is very poor, investment in Agriculture inputs is also very low. Nutrient management is very poor, there is no any major investment in the Plant protection. Sowing time is also late so maturity will come very late and plant will not get enough climatic conditions for proper maturity.
Mismatching Govt Data
Though, government data are most reliable source of the cultivation area, but this year these data don’t resemble with the ground realities. As per govt data there is 20% of total cultivation area of Rajasthan under guar seed but in reality it is not more than 15% in the guar growing belt.
Weakness In Other Agri Commodities
In guar growing belt, major cultivation area is under moong and moth pulses. In Churu district moth harvesting will start next month.
Interestingly, Prices of all the commodities, grown in guar belt this year, which were trading strong just one month ago are going down drastically mainly chana, moong and moth. The government has fixed anMSP for moong and moth but prices are far below. Kharif pulses are down before the production. Guar is strengthening before the production. Due to good rainfall and increased cultivation area the growth of Guar prices has slowed down but not stopped.
After two-month new crop will come in market currently guar is only crop which can give good return on investment. There are three basic factors. Rajasthan Haryana Gujarat is only source of supply of supply of Guar seed in world. There is no alternate of Guar. This one supply time and there will be demand throughout the year.
Demand is poor at this time but stocking activity will give good support to guar prices. At this time Guar is most favourable commodity for Stockists.
Expected Movement In Guar
Guar will be under pressure in next two three days of August month but in September it will become a growing commodity. Fresh guar contract will be delivered in October. From 19th October onward it will very problematic for sellers to supply the Guar to NCDEX and they will have to exit from the contract. Just before delivery on 19th August Guar will be available at Rs 4500/100Kg.There will be bumper production of Pulses and Bajara. Investors will not touch these crops as there will be no profit in stocking.
Crude Prices Improve
Crude is not maintaining above USD 50/barrel but it has grown up in comparison to last weeks. Improvement crude will be a good support to guar. Drilling companies will be ready to pay for guar at upper level. Crude future depends on OPEC decision for slowing down their production.
Speculators Market has been observing volatility in guar prices is as one day it goes up 4% and it slips down 4% very next day. Hence prices fluctuate 8% in merely two days. This is not a real movement and prices are influenced by the speculators.
Current positions
Guar is expected to improve from its lower level. If Korma prices go down further, it will be a good sign of increased processing and increasing demand of guar gum. Lower level of guar prices will improve in this month and it will reach up to 3700/100Kg.
Sowing will almost stop. Rainfall is god in guar growing belt there is no news of the any major damage. Once the rainfall will continue for 4-5 days then some disease attack will come in notice. Disease will outbreak in large area and it will spread very fast.
Product
Market
22/08/2016
23/08/2016
24/08/2016
25/08/2016
26/08/2016
27/08/2016
Guar Seed
Jodhpur
3200-3650
3200-3600
3200-3650
3200-3600
3200-3600
3200-3550
Hanumangarh
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3400
Sriganganagar
3200-3450
3200-3400
3200-3450
3200-3400
3200-3400
3200-3350
Bikaner
3200-3600
3200-3550
3200-3500
3200-3550
3200-3550
3200-3500
Siwani
3200-3525
3200-3475
3200-3525
3200-3475
3200-3475
3200-3425
Adampur
3200-3525
3200-3475
3200-3525
3200-3475
3200-3475
3200-3325
Sangaria
3200-3550
3200-3500
3200-3550
3200-3500
3200-3500
3200-3350
Deesa guar
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3250
Bhadra
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3300
Rawatsar
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-330
Nohar
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3300
Abohar
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3300
Gharsanamandi
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3300
Rajgarh
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3300
Taranagar
3200-3500
3200-3450
3200-3500
3200-3450
3200-3450
3200-3300
Khajuwala
3200-3450
3200-3400
3200-3450
3200-3400
3200-3400
3200-3250
Shardarsehar
3200-3550
3200-3500
3200-3550
3200-3500
3200-3500
3200-3350
Barmer
3200-3550
3200-3500
3200-3550
3200-3500
3200-3500
3200-3350
Guar Gum
ShriGanganagar
6450
6300
6350
6300
6300
6300
Jodhpur
6550
6400
6450
6400
6400
6400
Bikaner
6500
6350
6400
6350
6350
6350
Adampur
6450
6300
6350
6300
6300
6300
Siwani
6450
6300
6350
6300
6300
6300
Guar Churi
2300-2500
2300-2700
2300-2700
2300-2700
2300-2700
2300-2500
Guar Korma
2800-3250
2800-3300
2800-3300
2800-3300
2800-3300
2800-3250
(By Commoditiescontrol Bureau; +91-22-40015533)
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