Guar, unknown to many just a few years ago, will soon find its way into farmlands across many States.

The guar price episode that played out during the last season could change the cropping pattern not only in western Rajasthan, a major producer of this crop, but also across many other States.

This year guar is likely to be grown in Uttar Pradesh, Karnataka, Maharashtra and Madhya Pradesh apart from Rajasthan, Gujarat and Haryana. “I recently sent guar seeds for sowing to Surat and Ankleshwar,” said Mr Bhagirath Jhaveri, Vice-Chairman, Agriculture Produce Market Committee of Nokhamandi. Farmers of western Rajasthan grow a number of crop – guar, moth beans, green gram (moong), bajra, cotton, groundnut.

This kharif season some of the area under moth beans, green gram, bajra, cotton and groundnut will go under guar crop, farmers and traders said.

“A crop output of 1-1.25 crore bags of guar is a good crop. But this year even if rains fail, we could see this kind of output,” said Mr Jhaveri.

Rising prices

Guar seed and gum prices have been on an upward surge since November last year moving up from Rs 2,000-4,000 for 100 kg to a peak of Rs 30,000 due to supply tightness caused by shortfall in crop output and strong demand for the commodity.

The spectacular gains in prices prompted the commodity futures regulator Forward Markets Commission to finally suspend trading in this commodity. But prices continued to move up .

Guar, a 90-120 day crop, is a desert crop and requires just about three to four spells of rains with a gap of 20 days between each spell. This crop could see a three-fold rise in area under cultivation, said Mr Om Prakash Mundhra of Nokha Commodity Services.

In Sri Ganganagar, the main belt of guar seed, about 40 per cent of sowing has been completed because much of the land there is irrigated with water from borewells.

“Even if monsoon fails, crop will be higher this year,” he said. Demand for guar gum in the export market continues to be strong. In Jodhpur spot market, guar gum prices have come down to Rs 61,000 for 100 kg from their peak of Rs 1 lakh but yet considered a very good price.

“In irrigated areas where some sowing of guar took place in March, the crop is ready for harvest,” said Mr HansrajParakh, a guar gum miller.

The fortunes of guar have prompted opening of an additional four guar gum factories in Nokhataluka of Bikaner district alone. Currently, Nokha has 11 gum factories.

But the unprecedented rise in guar prices has also driven prices of seed up. Today, guar seed for sowing is available at Rs 45,000 for 100 kg compared with Rs 2,000 last year, said Mr Chandan Singh Bhatti, a farmer at Hadla village in Bikaner.

Traders at Nokhamandi are hoping that guar futures would be reintroduced for November, December, January and February contracts.

“If guar futures were not banned, prices would have come down,” said Mr Babulal Bhotada, a trader who short sold guar seed at Rs 7,000 level and suffered losses as prices continued their upsurge well beyond this level.

(The trip was sponsored by NCDEX)

(This article was published on June 25, 2012)
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