Guarseed spot and futures prices may remain firm in the next few days in expectations of the fresh export orders for guar gum products amid reduced fresh inflows in the producing states mainly Rajasthan.
Guarseed March 2008 contracts on NCDEX were up Rs 40 to trade at Rs 1,764 per quintal on Monday on some buying support from mills-cum-exporters and big stockists on lower supplies in Rajasthan mandis.
Futures prices were down by about Rs 110 over last one month on increased daily inflows but prices regained some ground last week on reports of reduced arrivals and fresh exports enquiries for gum products, a Jodhpur based trader said. Spot prices in Jodhpur were up Rs 25 to trade at Rs 1,619 per quintal on Wednesday over last week on fresh buying enquiries from exporters while spot prices in Bikaner were also up Rs 40 to trade at Rs 1,604 per quintal on Wednesday.
Daily arrivals declined to 35,000 bags on Monday from 40,000 bags on Saturday. Average daily inflows during the previous week were around 50,000 bags.
?Buying by guar mills and stockists has continued in the sport markets and is expected to improve in the coming days. Traders expect exports to go up this year. Guarseed arrivals would start declining by this month and we would see further upside movement in the prices thereafter,? an analyst with Angel Commodities said.
?Prices are trading at very low levels and sellers might restrict themselves from selling their produce below these levels,? analyst said.
Guar gum exports are estimated at 2.40 lakh tonne in 2007-08 against 2.10 lakh tonne in 2006-07.
Guarseed production is revised at around 80-85 lakh bags, slightly up by 10% compared to the previous year. However, exports increase by 10-20% every year and this might result in the demand supply mismatch in the long run.
Declining arrivals are likely to provide further support to the seed prices in the short term. March 2008 contracts prices might trade in the range of Rs 1,750-1,850 per quintal. In the long term, guar seed prices are expected to remain bullish on lower supply and comparatively higher export demand, sources said.