Guar Seed Declines on Arrival Pressure

Guar Spot as well as futures declined on Tuesday as arrivals have started increasing gradually across major guar growing areas. However, no major downside is expected as good demand, lower stocks and crop loss reports may support the prices till the new crop arrivals gain momentum.

Arrivals of Guar in Rajasthan would commence in full swing only after mid November.

Guar gum powder is being offered at higher rates on the back of good demand from the powder manufacturer amidst lower crop estimates.

There are reports that higher prices of Guar gum have made users to think for other alternative cheaper sources of gum for Oil exploration.

However, no confirm reports are available as of now.

Production

Guar seed output in Rajasthan is estimated at 11.36 lakh tonnes for 2011-12 season compared to 15.46 lakh tonnes in 2010-11 (Rajasthan Farm Dept).

Production of Guar in Haryana and Gujarat is expected to be 0.2 lakh tonnes and 0.07 lakh tonnes respectively in 2011-12.

However, there are unconfirmed reports that Guar seed output may be lower around 10 lakh tonnes compared to the government target of 11.3 lakh tonne due to excess moisture in the soil during the sowing period.

Exports

According to Agriculture and Processed Food Products Export Development Authority, Indian Guar gum exports for the period April- March 2010-11 surged by 84% and stood at 4,03,007 tonnes as compared to 2,18,473 tonnes during the last year.

Exports of Guar gum from April to June of the current fiscal year 2011-12 stood at 1.45 lakh tn compared to 0.71 lakh tn during the same period last year.

Exporters believe that exports which had crossed over 4 lakh tn last year, may hit this year due on financial crisis in U.S & Europe along with shift in demand.

However the export figures clearly indicates that global crisis has not hit Guar exports as of now in the current season too.