In the wake of overall demand of edible oils, two major oils — groundnut and cotton seed — being crushed in Gujarat are witnessing an unprecedented bullish trend.
In the wake of overall demand of edible oils, two major oils — groundnut and cotton seed — being crushed in Gujarat are witnessing an unprecedented bullish trend. As a result of it, groundnut oil price has crossed Rs. 1,900 per tin (15 kg) and in the case of cotton seed oil the prices are inching towards the Rs. 1,500-mark.
In a span of a month, groundnut oil prices have increased by Rs. 140 per 15 kg. On November 18, 2019 groundnut oil price was Rs. 1,790 per tin, which has jumped to Rs. 1,920 on Thursday.
The price of cotton seed oil has also gone up by Rs. 90 from Rs. 1,390 to Rs. 1,480 during the same period.
Leading edible oil traders in Gujarat are expecting bullish trend for next one month. According to them, groundnut oil price would cross Rs. 2,000 per tin, while cotton seed oil may hover around Rs. 1,500 in near future due to continued domestic as well as overseas demands.
Despite bumper groundnut crop of around 32 lakh tonne, price is going northward in the oil.
Surprisingly, groundnut yield was hardly 18 lakh tonne last year but prices were much lower. Previous year groundnut oil production in Gujarat was around 3.75 lakh tonne.
This year the production may cross 5 lakh tonne mark as per the estimate of edible oil traders.
“The rise in the prices is mainly attributed to spurt in groundnut oil exports by three folds compared to last season. Previous year, nearly 15,000 tonne of groundnut oil was exported. Edible oil exporters have already booked orders of approximately 40,000-45,000 tonne during the current season.
And if sources close to exports of the commodity are to be believed, by the end of current season, total exports of groundnut oil may cross 60,000 tonne.
Samir Shah, president of Saurashtra Oil Mills Association (SOMA) says that not only export demands, but there has been huge domestic demand of groundnut oil. In Gujarat people generally purchase groundnut oil for whole year post Diwali, said Shah, adding that due to extended monsoon, crushing of groundnut delayed and hence pick season started after the first week of December this year.
“The augmented prices of groundnut oil and cotton seed oil are in line with overall surge across all edible oils globally. Moreover, import of palm oil has decreased in November.
These factors are also affecting the increased prices of both oils,” opine commodity traders.