Tuesday, 22 March 2016

Will Guar seed and Guar gum prices improve with Global Crude oil prices, which rose for a third consecutive week ?

Guar industry was looking some improvement in Guar seed and Guar Gum prices with global Crude oil prices improvement for a third consecutive week. as per existing data this improvement in crude prices is due to continue decline in drilling activity. again it is negative factor for guar seed and guar gum industry as consumption of Guar gum powder will come done with declining drilling activity. 

We can see further pressure on Guar gum demand. There is very low possibility in further decline in Guar gum prices because current level is at its lowest possible level. Industry is covering processing cost and other expenses from guar churi and guar korma demand.

Will Guar seed and Guar gum prices improve with  Global Crude oil prices, which rose for a third consecutive week
Will Guar seed and Guar gum prices improve with  Global Crude oil prices, which rose for a third consecutive week 
Fundamentally there is not problem in guar seed production side so this pressure will continue. Currently improvement is crude prices is due to supply constraint. Once it will be demand driven then we can see an improvement in guar seed and guar gum prices. 

There is also some inputs that companies are waiting for result of US president election for further expansion of their operations. Global political crises are slowly and slowly moving toward stabilization but it will take time in complete stabilization. Fear of slowdown in Chines economy is also increasing. Energy demand is primary factor in crude price improvement.  

Guar seed and guar gum prices will see a demand driven impact of crude prices improvement once crude will cross the level of 70 USD/barrel.  Let's see how log time it will take to cross this level. 

We will have to wait for 3-4 month  or up to July, if any favorable factor emerge during this period like intensity of rainfall, pattern of rainfall, change in guar seed and guar gum cultivation sowing area, change in alternate crop and prices of other  agricultural commodities, 

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