Global demand to boost sesame

Prices of sesame seed are set to surge following a strong demand from global markets and falling domestic production.

A major shift to cotton from sesame seed cultivation is likely to hit the output of the seed across the country by at least 25 per cent. Moreover, a drop in output in the world's major sesame seed-producing centres such as China, Sudan and Ethiopia, is further set to fuel the prices.

The arrivals of the crop usually rise substantially in May and October following the arrival patterns in summer and winter. This year, however, excess cotton cultivation has dealt a blow to sesame seed output.

"Gujarat registered an annual output of around 1.50 lakh tonne of sesame seed in the last two years. But, the trend has suddenly changed this year, with excess cotton cultivation in the state taking its toll on the sesame seed output, thereby catalysing a rise in the prices," said Paresh Raithatha of Tirupati Agri Brokers.

The country's annual output is usually around 4 lakh tonne, with domestic consumption accounting for 25 per cent of the production and the rest catering to exports. This year, however, the production is set to decline to around 3 lakh tonne "" a decline of 1 lakh tonne "" with Madhya Pradesh and Uttar Pradesh together likely to register 1.6 lakh tonne, followed by Gujarat with 60,000 tonne, Rajasthan 45,000 tonne and Andhra Pradesh, Karnataka and Tamil Nadu accounting for the balance.

Natural sesame, which was quoting in the range of Rs 30,000-32,000 tonne in January, shot up to around Rs 41,000 a tonne this month, registering a 28 per cent rise. The prices of hulled sesame seed rose marginally by Rs 7-8 a kg in the previous two months, reflecting an increase of about 20 per cent. Market sources estimate natural sesame prices to rise by Rs 3 a kg to Rs 45,000 a tonne in the next few days.

The crop loss in China, Ethiopia and Sudan had shifted the global demand to India. About 35 hulling units located in Gujarat, Madhya Pradesh and Uttar Pradesh, which process the seed and primarily cater to the exports market, were facing tremendous demand from the global markets, said Raithatha.

Korea, which is likely to float a tender for 5,000 mt of sesame seed in April, is likely to further fuel the prices. Besides, the market is abuzz with speculations that such tenders would be floated every month, which will leave the domestic market bullish.