Rutam Vora Driven by a bullish sentiment following lower-than-expected crop prospects and sustained export demand, castor seed prices have touched their highest levels since 2011, when they had tested ₹6,200 a quintal.

Farmers and trade sources indicate that those highs will be breached in the coming months as the carryover stock is running out and the new crop arrival is at least four months away.

Spot prices of castor at the Deesa market in Gujarat have touched ₹5,330 a quintal. On the NCDEX futures for November contract, prices touched ₹5,454 on Thursday, against ₹4,710 on October 5.

BL26pg1Castorseedcol
 

There is a huge demand for the derivatives and oil-cakes of castorseed — which is primarily grown in Gujarat and Rajasthan — in overseas markets including China.

Traders attributed the recent rally to the reduced stocks; these are currently at 4.5 lakh tonnes, against last year’s crop of about 14.5 lakh tonnes.

“Fresh crop is likely to come in only by March 15,” observed Rakesh Dhariwal of Maa Vankal Group in Rajasthan.

“There will be some shortage during January-March. Also, the deficient rains in major growers Gujarat and Rajasthan have dented the prospects, due to which we expect a crop of not more than 10 lakh tonnes. Everyone, including farmers, will prefer to hold the stock, which will fetch good prices,” he added.

According to BV Mehta, ED, Solvent Extractors’ Association of India, the Centre has projected a castor crop size of 15.17 lakh tonnes for 2018-19, which is a tad lower than the 15.68 lakh tonnes in the fourth estimate of last year.

“The deficient rains have affected the crop. We will conduct a crop survey, but from early reports, there has been some damage, and the crop size could be lower than the government estimate,” he said.

Related Topics
comment COMMENT NOW