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Suresh P. Iyengar

Mumbai, July 18 The dry spell for the last eight days in central and western parts of the country has sent guarseed and guar gum futures soaring on NCDEX.

The dry weather is expected to continue for another four to five days, according to the India Meteorological Department.

“There has been very little rainfall in Rajasthan in the last seven to eight days and this has slowed the sowing process in guar growing regions,” said a Sharekhan Commodity report.

Guarseed for August delivery on NCDEX jumped over 5 per cent to Rs 1,735 per quintal on Tuesday from Rs 1,648 on July 9. September deliveries have climbed 5.5 per cent to Rs 1,767 per quintal on Tuesday from Rs 1,676 on July 9. Prices in the Jodhpur markets were also up by Rs 80 to Rs 1,708 per quintal from Rs 1,628 on July 9.

However, on Wednesday traders preferred to book profits, which resulted in August contracts dropping Rs 9 per quintal to Rs 1,726, while September contracts lost by Rs 12 a quintal to Rs 1,755.

Futures of guar gum — a by-product — also moved in tandem. Guar gum for August delivery rose 4.30 per cent to Rs 4,432 per quintal from Rs 4,249 on July 9. September deliveries were marked up by 4.72 per cent to Rs 4,520 per quintal from Rs 4,316 on July 9. October contracts remained higher at Rs 4,600 per quintal on Tuesday.

Profit-booking also pulled down guar gum futures by Rs 38 to Rs 4,396 per quintal on Wednesday, while September deliveries were down by Rs 23 to Rs 4,497.

On Monday, the guar seed stock at NCDEX accredited warehouses was marginally up at 26,553 tonnes against 25,890 tonnes on Saturday.

The demand for guar gum from the overseas markets has remained steady over the last few months.

The country’s guarseed exports this year are expected to rise by 47 per cent to 2.20 lakh tonnes.

India exports guar gum to the petroleum industry in the US and also to the oil fields in West Asia.

“Though the present dry spell will have a short-term impact, rains in August-end and early September in Rajasthan will play a crucial role in deciding the long-term future trend. Rajasthan accounts for 70 per cent of the total production of about 5-7 lakh tonnes,” said a trader.

More Stories on : Climate & Weather | Commodity Markets

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Dry spell sends guar seed, gum futures soaring

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