Guarseed slips on higher output estimates

Commodity sheds more than 1% on NCDEX, but losses limited by rising export demand

Guar seed prices dropped by Rs 65 to Rs 5,615 per quintal in futures trading after speculators trimmed positions, driven by higher production estimates and mounting stocks.

Marketmen said in addition to huge carry over stocks position on ample supplies from growing regions, profit-booking by speculators and higher output estimates mainly attributed the fall in prices.

They said, however, export demand for guargum which mostly used in petroleum refining, food processing and pharmaceutical industries, limited the losses.

At the National Commodity and Derivatives Exchange counter, guargum prices for July delivery shed Rs 65, or 1.14 per cent to Rs.5,615 per quintal, with an open interest of 721 lots.

The most-active for delivery in June month fell by Rs 60, or 1.07 per cent, to Rs 5,525 per quintal, having an open interest in 20,694 lots, while contracts for delivery in current May month slipped by Rs.55, or 1.00 per cent at Rs.5,420 per quintal, in an open interest of 7,230 lots.

Meanwhile, India is the key exporter of the commodity and produces almost 80 per cent of the world's total guar gum.