The Hindu Business Line : Groundnut oil prices seen firm in short term on low stocks

GROUNDNUT oil prices, especially in Gujarat, are expected to remain firm in the next few days in anticipation of the approaching festival season demand and lower ready stocks, traders said.

In Rajkot, groundnut oil (tin) prices have moved up to Rs 805-810 for 15 kg on Monday from Rs 785 last week, while groundnut oil (loose) ready prices were also up to Rs 520 for 10 kg from Rs 507 quoted last week. Similarly, groundnut kernel prices in Mumbai also moved up Rs 50 to Rs 2,495 a quintal in a week's time on continued buying interest.

"In Saurashtra region, overall stocks in oil form are relatively low. Total stocks of kernel and seeds are also reduced to 10-15 per cent of the total crop. As against this, seasonal demand for groundnut oil will increase in the next few days due to a series of festivals," Mr G.G. Patel, an oilseeds trader, said.

On the other hand, demand for groundnut would also continue due to export demand, especially Ramzan, a trader said.

"Fresh demand for "Shravan" - a Hindu holy month will begin this week. Supply pipeline is dry and overall stock is low. New arrivals of seeds from early sowing will start in the first week of October. As a result, price rise can't be ruled out," Mr Mayur Mehta, an analyst, said.

"Groundnut oil (loose) prices in Saurashtra may hover around Rs 540-550 per 10 kg in the short run," he said.

Groundnut acreage under the current kharif season is 18 lakh hectares (ha) from 18.80 lakh hectares last season, down 80,000 ha.

Normal area under groundnut acreage in the State is 18.83 lakh hectares, according to an official of the Department of Agriculture, Gujarat.

"Progress of groundnut sowing in the State is satisfactory. Good and timely rainfall has been reported in the Saurashtra region during the second round," he said.

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