Export value of Guar Gum products has increased by 55 % in year 2017-18.

As per primary data released by APEDA export value of Guar gum has increased by 55% . This year Guar gum export from April-17 to December-17 was 3,65,452 MT. Last year in the same period April-16 to the December-16 export of Guar gum was 2,69,001 MT. There is an increase of 96,451 MT or 35.85 % in quantity of Guar gum products for the period of April- December. Last year from April-16 to December-16, we exported Guar gum, values of INR 1983,00,00,000 (1983 crore) or 295 Million USD, for the same period during this year from April-17 to December-17 India exported Guar gum value of INR 2951,00,00,000 (2951 Crore) or 458 Million USD. Last year from April-16 to the December-16-unit value of Guar gum export was 1098 USD/MT this year for the same period from April-17 to the December-17-unit value of Guar gum export is 1579 USD/MT. In Indian rupees, this is an increase of 48.83% INR and in USD it is an increase of 55%.

Only in December -17 months there was an export of 43,880 MT of Guar gum. Export of Guar gum expected to increase with increased crude oil prices. Crude oil prices have increased during January month. Oil companies in USA have increased the production of crude oil through hydraulic fracturing/fracking process. Prices of crude oil are low due to increased oil production. One thing is positive that crude oil prices are decreasing due to increased Shale crude oil production in the USA, not from OPEC production.

The demand for Guar gum will keep going with the current level of crude oil prices. Oil companies have earned enough margin to continue their crude oil production. Indian Guar gum industry should take it positively that if production of crude increased in USA then it is good for Guar gum. If production increases from OPEC, then it would have forced USA crude oil to stop.  China has emerged as leading importer of crude oil.  This is direct competition between OPEC crude oil production and Shale crude oil production. Shale crude oil production is winning slowly and slowly.

Guar and guar gum price remained stable in local markets but trimmed in forward contracts

Guar seed and guar gum price were under pressure of profit booking in forward market. Investors trimmed upper positions for their future contracts. Local markets are stable and strong. Local demand of guar and guar gum is continuing at current prices.  Traders and guar gum powder processor are buying guar and guar gum at lower prices.  In long term guar will get good support from crude oil prices. Crude oil prices are improving with growing rate since last upward trend prices of crude has not come in major downward position. guar and guar gum will regularly be getting support from improving crude oil prices.

Good quality of guar seed is traded at Rs 4600/100Kg and average quality guar seed is traded at Rs 4400/100 Kg. Standard quality guar gum is traded at Rs 10000/100 kg. In interior location guar is traded up to 4200/100 Kg. guar seed is being traded weak in future market. At NCDEX (National Commodity & Derivatives Exchange Ltd) guar seed-10MT is being traded at Rs 4455, 4616, 4686 lower by by 1.91 per cent or INR 88/100 Kg, 1.93 per cent or INR 91/100 Kg, 1.62 per cent or INR 77/100 Kg with open interest of 129330, 96570, 14020 for February, March and April.

Guar gum is being traded weak in future market. At NCDEX (National Commodity & Derivatives Exchange Ltd) Guar gum- 5MT is being traded at Rs 9765, 9890, 10020 lower by 2.55 percent or Rs 256/100Kg, 2.66 percent or Rs 270/100 Kg, 2.93 percent or Rs 302/100 Kg with open interest of 36355, 45155, 255 for February, March and April contract.

Branched type Guar  gum plant

Arrival of guar has reached lower than 20,000 Bags per day. Farmers are carrying small amount of guar commodity to market for their financial requirement. Peak arrival of guar seed period has gone. Arrival of guar commodity to local markets will drop further. Farmers are getting competitive price for their guar at upper side from local traders.

Guar seed and guar gum prices are moving upward with increasing crude oil prices and low production estimates

Guar prices are moving in upward directions with increasing crude oil prices. Crude Oil price is increasing slowly and slowly. This is a good sign for increase in demand of guar gum. Brent crude oil has crossed the level of 64 USD/ barrel. New drilling activities are also expected to increase with increasing crude oil prices. Major demand of guar gum is expected to rise from US and other new oil exploring countries. 

Prices of guar is also increasing in Pakistan. This year production of guar seed is low in both guar producing countries India and Pakistan. Some traders are expecting boom in guar prices like 2012. As per market information Rs 5000/100kg level will be very hard. Fresh arrival of guar seed come after ten months in October. with increasing prices stockist and farmers will try to hold materiel for more margin.

Market men are providing the figure of  guar seed production of 70,00,000 -75,00,000 bags (100 Kg each). This year fresh crop was started to traded at the level of 3200/100 Kg. It has reached to the level of Rs 4100/100 Kg in local market, thus gaur has given the return more than 25% till now. If it will reach to the level of Rs 4500/100 Kg then there will be 40 % return.

Prices of guar gum is also increasing in the same trend. Guar gum was trading around Rs7600/100 Kg at the time of arrival fo new crop now it has touched the level of  Rs 9000/1000 kg though Guar gum prices are in line with trend of fresh crop arrival but after export demand arrival trend is major factro which influence the guar gum prices. This year prices of guar gum may touch the level of Rs 12000/100 kg.

Farmers can wait for new 2-3 months for better prices.Existing stock will adjust in market and demand of guar seed will increase in market. At this time all the factors are positive for guar prices. Once it will cross the 4500 level then individual investors will start to buy the stock. Most of Guar crop is grown in rainfed area. Crop production depends on good and even rainfall. This year rainfall pattern was  poor in guar growing belt. 

Demand of Guar gum is expected rise in next year .

This year Guar seed prices are rising slowly and slowly. It has crossed the level of Rs 4000/100 Kg. As per global energy organizations crude oil production is expected to increase in coming year 2018. Oil production of USA is going to cross the level of 10 Million Barrel Per day in 2018. With increasing crude oil prices new drilling activities will start in USA. Demand of drilling chemicals will increase. Currently crude oil prices are above USD 62 / Barrel.

During this month prices of Guar seed are moving around 3800-3900/ 100 Kg. This is last phase of peak arrival time of Guar seed in local markets in Guar seed growing area. Supply of guar seed from farmers to market will come down by the end of December. New stock has almost settled either with traders / processor or farmers. By this time if farmers has not sold his production then he will wait for 5-6 months.

Next 3-4 months are very important for guar seed.  As per market information , total production of guar in this year is expected around 70,00,000-75,00,000 Bags ( 100 kg each). This figure is much lower than previous years. In next three four months prices of guar seed is expected to cross the level of Rs 4500 / 100 Kg. 

As per inputs from markets and other stack holders current demand of guar gum is low. If we consider all facts then we find that Guar seed will god return in coming months. In international market Crude oil prices are also improving slowly and slowly.