Groundnut oil price on all-time high

Groundnut oil has crossed Rs 1,600 per 15-kg tin setting an all-time high level of Rs 1,620 per tin amid increased demand from retail and branded segment. Reduced availability of raw material for crushing is believed to further jack up the prices.

In Rajkot markets, groundnut oil traded in the range of Rs 1,610-1620 per tin. The prices have jumped by Rs 60 per tin in past three days. Groundnut oil had hit a peak level of Rs 1,585-1,590 per tin on June 21, 2011."Crushing becomes expensive as the price of groundnut has increased too high. As the raw material is not available easily, we see prices of groundnut oil reaching to a new high," said Suresh Kaneriya of Kaneriya oil industries.

Meanwhile, groundnut oil (loose) jumped by Rs 10 to Rs 965-970 per 10 kg. However, industry insiders feel that the price rise was mainly an outcome of the speculative activity by the traders. "Speculators are giving misleading picture to gain personal benefits. It is true that availability is low but demand is also not so high," informed a Jamnagar-based miller requesting anonymity. The industry believes that the reduced availability was the prime reason for a sudden price rise in the groundnut oil. "Lack of availability of groundnut for crushing has pulled up the groundnut oil price to a new high. Oil millers have been facing this problem for quite long. Moreover, the demand from branded players and retailers is also there," said Samir Shah of Rajmoti Oil Industries.

He said, "Summer production of groundnut is good but most of the stock was consumed by the exporters and other local food producers." According to industry sources, the prices of groundnut oil are believed to hover upwards till the new season starts. On the other hand, the traders maintained that the demand from exporters and others had come down due to high price of groundnut.

The groundnut arrivals at various Agriculture Produce Marketing Committees (APMCs) in Saurashtra and Gujarat was reported at about 40,000-50,000 bags (each bag = 40 kg). The price for bold quality of groundnut in Rajkot market stood in the range of Rs 670-825 per 20 kg, while small quality was priced at Rs 623-890 per 20 kg.