With rain lashing growing areas of Gujarat, castorseed futures plunged over 2 per cent on Wednesday. The counter has been witnessing a bear run since the last 10 days with prices dropping over 10 per cent in a week.
The sharp drop is attributed to speculators booking profit with the monsoon gathering pace in August. Rain since the second of week of August covering most parts of the country has shrunk monsoon deficit to 12 per cent at the beginning of this week. Areas such as Gujarat, Punjab, Haryana and Rajasthan that witnessed poor monsoon have benefited from the latest showers.
Near-month September contract dipped 2.71 per cent to near Rs 4,000-a-quintal mark. It quoted at Rs 4,064 at noon, down by Rs 113 over Tuesday’s close. October contracts were down Rs 118 or 2.72 per cent at Rs 4,216, while November contracts slid 2.03 per cent (Rs 90) to Rs 4,341. December futures slipped Rs 86 (1.91 per cent) to Rs 4,416.
Castorseed prices had rebounded during June-July from the sharp fall during October-May this year. Prices had crashed on record production leading to a supply cut.
Threat of drought in growing areas, lower sowing of castor and export demand buoyed prices.
India is the leading producer of castorseed and castor oil. It accounts for over 80 per cent castor oil production in the world. At least 60 per cent of castor is produced in Gujarat, followed by Andhra Pradesh (19 per cent) and Rajasthan (14 per cent).
During the first quarter of the current fiscal, castor oil exports increased 17.5 per cent.
At the Disa spot market in Gujarat, prices were quoted at Rs 4,023.50 a quintal.