Tight supply, exports push up sesame seed price

Traders expect prices to rise to around Rs 5,000 per 20 kg amid demand pressure

Heavy buying by exporters and increased local demand has pushed up natural sesame seed prices to Rs 3,700 per 20 kg. Market experts maintained that prices increased owing to tight supply conditions in both domestic and international market due to lower production.

As per market statistics, sesame seed prices have gained by more than 33 per cent to Rs 4,000 per 20 kg on last Wednesday, which is higher from Rs 3,000 per 20 kg a month ago. But after touching new high, demand in sesame seed has reduced and now price reached to Rs 3,700 per 20 kg. While hulled sesame seed premium quality is still ruling on Rs 3,960-4,000 per 20 kg and semi-premium hulled price is traded on Rs 3,800-3,850 per 20 kg.

In the international market, India's sesame seed is being quoted at $2,700-2,800 a tonne.

"The only reason behind price rise is the shortage of supply against huge export demand. Exporters are buying heavily to fulfill their commitments. Moreover, domestic demand also good at this time," said Sagar Chag, director of Sagar International from Rajkot.

He noted that international supply was also dull, which may further push up the prices. Sesame seed crop in Pakistan is expected to be lower this time. Till September, sesame seed production was expected to be good in India but heavy rain at the end of September mainly in Gujarat has abolished all the expectation.

In its crop survey, the Shellac & Forest Products Export Promotion Council (Shefexil, a trade body sponsored by the ministry of commerce) says production might fall by 11.7 per cent in 2013-14 to 253,000 tonnes, due to lower sowing area (down 5.8 per cent) and yield (down 6.2 per cent). However, traders believe that sesame seed production will not be more than 150,000 tonnes in India.

Traders maintained that production of Gujarat will be around 40,000 tonnes.

Manoj Sonpal of Sonpal Agri Export from Amreli, said, "As price has gone up in recent time South Korea has cancelled its tender for 5,100 tonnes a few days back. Last, tender for 8,000 tonnes was opened on October 30 this year."

He said that demand from Europe, Gulf countries and China is huge and India cannot match the supply. Moreover, domestic demand is also good which may pull the price in coming days.

According to traders, sesame seed price may touch Rs 5,000 per 20 kg within next one month.

By end of this month South Korea's 4,300 tonne tender will announce and as per the traders only Indian bidders will participate in it. This may pull up sesame seed price more in coming days.

Due to lower production, arrival of sesame seed is very limited in Gujarat and across the country. About 4,000-5,000 bags sesame seed arrives every day in Gujarat and the country's arrival reported about 10,000-11,000 bags a day.