Markets seem to recover from these lower levels as traders anticipate prices at very strong support levels and further fall in prices may not be sustainable. Exports have started rising in mandis (aided somewhat by a moderate pick up in Crude Oil prices).
Lack of strong uptrend for Crude Oil rates has been limiting the export demand. With Guar being used for oil drilling purpose, export demand from US is expected to rise on a rise in Crude Oil prices. Failure of Crude Oil rates rising is affecting Guar prices.
As per reports, Guar gum exports during ongoing fiscal year 2014-15 is expected to decline 25% to 4 lakh to 4.5 lakh tons because there is weak demand for guar gum in the International market due to slump in crude prices . India's guar gum export was near 6 lakh tons during the last year
High stocks, weakness in Crude oil price resulting in low export demand, poor quality arrivals had kept pressurizing prices. Poor quality stocks with farmers too resulted in prices falling. But reports indicate farmers may not be willing to sell at these lower present levels.
As per Rajasthan Agri Department's 2nd advance projection, during 2014-15, production of guar is expected nearly 27.95 lakh ton in the state while earlier expectation was of 14-15 lakh ton. It is to be noted that during 2013, around 50 lakh hectare area was sown which produced 28.61 lakh tonnes guar.
As per reports from APEDA, in 2013- 14, India exported more than 6 lakh MT Guargum vs nearly 4 lakh MT in the previous year due to a significant fall in rates. However this also ensured a fall in Export realization which fell by 45% in Re terms.
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