Weekly: Guarseed/Guargum Recover A Tad; But Trend Still Uncertain

MUMBAI (Commoditiescontrol) – Spot Guarseed and Guargum prices rose during the week (April 9-14) helped by sharp recovery in crude oil and better export data, however buyers are still cautious and dealing in small lots.

Guarseed prices during the week rose by 0.25% at 4,135 at the benchmark Jodhpur market, while Guargum edged up by 0.86% at 8,865/100kg.

Daily average arrivals during the week stood lower at 8,700 tonnes vs 10,700 tonnes a week ago.

India Guargum export during April-February rose over 24% at 449,706 tonnes as against 361,833 tonnes during the same period a year ago, according to Agriculture & Agri Processed Food Authority of India (APEDA).

The latest APEDA report revealed that export of Guargum during the month of February dropped 9.81% at 44,081 tonnes versus 48,878 tonnes last year, but up 9.72% from 40,174 tonnes in a month ago in January.

Oil prices rose on Friday, making the largest weekly gain since July, supported by concerns about the possibility of Western military action in Syria and reports of dwindling global oil inventories.

Brent crude recovered from losses early in the session and settled 56 cents up at $72.58 a barrel, with a $5.48 weekly gain, or 8 percent. U.S. West Texas Intermediate (WTI) crude futures rose 32 cents to $67.39 a barrel, up 8 percent for the week.

Baker Hughes on Friday reported that the number of active U.S. rigs drilling for oil climbed by 7 to 815 this week. The oil-rig count had increased by 11 last week. The total active U.S. rig count, which includes oil and natural-gas rigs, rose by 5 to 1,008.

These numbers are positive for Guarseed and Guargum and may support prices, but next on Monday, April 16, 2018, the India weather bureau will release its first stage monsoon forecast for 2018, which will gauge future market trend.

Guarseed-Guargum Futures
Guarseed May futures during the week closed with gain of 0.41% at 4,111.50/100kg on the National Commodity & Derivatives Exchange Ltd (NCDEX). Other hand, Guargum May contract notched gain of 0.53% at 8,937/100kg.



Conclusion
Guarseed and Guargum prices may find support around phycological level of Rs 4,000 and may rise to 4,250-4,300, but sharp weakness in prices can’t be ruled in case prices close and sustain below Rs 4,000 level, according to trade experts.

(By Commoditiescontrol Bureau; +91-22-40015533)