The Hindu Business Line : Guarseed, gum prices rise on crop failure fears

FUTURES prices of guarseed and guar gum at NCDEX have increased by about 30 per cent this month, mainly on speculative buying support by some operators on fear of crop failure in western Rajasthan, traders said.

Similarly, spot prices of guarseed in Jodhpur market have also moved up by 38 per cent on continued buying from processors.

"Futures prices were going down last month. They took a U-turn early this month, as some operators were active buyers on reports of no rainfall in western Rajasthan. There are reports in the market that a few sellers who sold earlier are now covering their positions," a Jodhpur-based trader said.

Guarseed September contracts at NCDEX have moved up by 29 per cent to end at Rs 1,859 a quintal on Monday from Rs 1,503 reported on August 1. Guarseed October contracts also moved up by 17 per cent to close at Rs 1,913 a quintal on Monday (Rs 1,630).

Guar gum October contracts have also firmed up to Rs 5,065 on Monday (Rs 3,926). Guargum September contracts rose to Rs 5,179 on Monday (Rs 4,000).

Guargum spot prices, too, have moved up to quote at Rs 5,325 a quintal on Tuesday (Rs 3,857).

Guarseeds spot prices in Jodhpur market jumped to Rs 1,865 on Monday (Rs 1,443). However, prices fell sharply by Rs 100 to Rs 1,525 in July end.

"Guar crop needs second round of rains till August-end or early September, which is crucial for crop," a leading processor said.

"New arrivals of seed from Ganga Nagger, Hanumangarh and Haryana are expected in mid-September. On the other hand, stocks with traders and stockists are reported to be around 18-20 lakh bags, which is adequate to meet domestic demand. However, export demand is steady," he said.

India accounts for 80 per cent of the total guar produced in the world and 70 per cent is cultivated in western Rajasthan.

Apart from Rajasthan, it is grown in Haryana, Punjab, and some parts of Uttar Pradesh and Madhya Pradesh.

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