Groundnut oil prices touch all-time high

Crosses Rs 1800 per 15 kg tin level

In spite of lower demand, groundnut oil prices reached an all time high of Rs 1,810 per 15 kg tin on Tuesday, on grounds of poor availability of groundnut for crushing. Rajkot, which happens to be one of the major production centres for groundnut oil in Gujarat, saw prices of around Rs 1,805-1,810 per 15 kg tin.

Similarly, loose groundnut was traded at Rs 1,070-1075 per 10 kg. Apparently, groundnut oil's low availability saw the commodity gaining about Rs 130 per 15 kg tin in the past one month.

"Demand in retail is below normal as prices has gone up since last one month. As of now, buyers have resorted to need-based purchase of oil. However, if prices decline in near future, more buyers may begin coming to the market," said Rajkot based retailer.

Prices of groundnut oil constantly increased since mills had not been able to source the crop for crushing. Arrivals of groundnut declined in past few weeks as most of the farmers were also busy with religious activities in and around the Saurashtra region.

Arrival of groundnut came down almost 50 per cent to 5000-6000 bags from 10,000-12,000 bags in the past couple of weeks. Groundnut prices also increased in this time as export demand re-opened. During February groundnut prices increased over Rs 40 per 20 kg. Groundnut bold was traded on Rs 755-905 per 20 kg while groundnut small's prices stood at Rs 740-865 per 20 kg on Tuesday.

"The prices have increased primarily because millers are facing a shortage of groundnut for crushing. Most of the groundnut is absorbed in exports at present. Moreover, farmers are holding on to the crop as they want higher prices for the same," said Samir Shah, president, Saurashtra Oil Mills Association (SOMA).

According to another Jamnagar-based miller, it is very crucial year for millers as they don't have enough stock of groundnut for crushing.

"Most of the groundnut oil mills have cut down working hours as they have no groundnut stocks for crushing," added Shah.

Meanwhile, the Indian Oilseed and Produce Export Promotion Council (IOPEPC) stated that India has exported 350,000 tonne groundnut during April-September 2011. In 2010-11 country's total groundnut export was stood on 419,000 tonne.