Friday, September 25, 2015

PRICE AND TRADE OF GUAR

Price Movement of Guar
Guar bean has shelf life of more than 3 years without losing out on any of its properties or qualities. It requires the minimum maintenance and handling environment. Therefore, traders
 derivatives very much depend on the monsoon condition and its likely production.  or stockist store guar for as long as 6-7 years. However, prices of Guar bean as well as its
  Factors Influencing Guar Price
1. Rainfall during sowing and critical     stages of growth
2. Area sown under the crop in Major  states like rajasthan, Haryana,  Punjab, Gujarat, etc.
3. Pattern of arrivals on a regular basis in markets like Jodhpur, Bikaner, Sriganganagar, Adampur, Bhiwani,   Siwani, etc.
4. Demand from millers or rocessors  and export demand
5. Carryover stock.
The prices are observed to be highly volatile during monsoon months due to market speculation. There is a good correlation between rainfall and production in Rajasthan as the Guar crop is rain-fed. The effect of rainfall on production is seen less in case of Haryana where Guar is an irrigated crop. The other factors like pattern of arrival, demand from millers and 
export also cause volatile price movement. 

Fluctuation in Spot prices 

The spot price of Guar seed for the last 7 years i.e., from 2007 to 2013 reflects high volatility of prices. The Spot price at Jaipur market and Sri Ganganagar are analyzed. The price fluctuates highly during monsoon period i.e. July to October. Guar seed traded at  Kishangarh Renwal market between INR 4000/qt. during Oct, 2012 to INR 15000/qt. in the month of December, 2012. In 2013 the highest price at Jaipur was recorded in the month of January at INR 14400/qt. and lowest recorded was INR 4200/qt. in August. Highest fluctuation in prices of Guar bean has been observed inthe year 2012. During the year 2012, prices at Sri Ganganagar market ranged from INR 7752/qt. to INR 28556.2/qt. Annual volatility (measured as Coefficient of Variation) in Mandi prices of Guar seed at different markets has been worked out and

Table Volatility in Guar bean Prices (C.V. in %)


year

                       RAJASTHAN                                                    HARYANA
Ganganagar
Jaipur
Hanumangarh
Adampur
Fatehabad
Hissar
2007
5.5
6.0
5.9
6.0
6.7
6.9
2008
7.2
8.5
7.8
8.0
7.1
9.6
2009
20.9
19.3
22.0
21.1
21.5
20.2
2010
7.8
8.4
8.0
6.7
8.3
14.7
2011
29.4
50.6
36.1
28.1
29.5
25.4
2012
46.1
38.5
33.8
47.7
56.3
56.7
2013
29.2
39.5
28.3
24.5
23.5
56.6
 Source: Agmarknet 


Results of the analysis reflect that there was high volatility in prices of Guar bean at 
Hissar (56.7% and 56.6% in 2012 and 2013, respectively), Fatehabad (56.3% in 
2012), Jaipur (50.6% in 2011), Adampur (47.7% in 2012), Sri Ganganagar (46.1% in 
2012) and Hanumangarh (36.1% in 20011) markets, as indicated by the higher 
magnitude of CV in the respective markets. 

The price of Guar seed ranged from INR 4000/- per quintal to INR 11000/- quintal at 
Jaipur market in 2013. While for the same period the price range at Sri Ganganagar 
was from INR 7752/- per quintal to INR 28556/- per quintal. In the year 2013 the 
ranges of price at Jaipur and Sri Ganganagar market were INR 4361/- per quintal to 
INR 11482/- per quintal and INR 5004/- per quintal to INR 11743/- per quintal 
respectively. 

The high price fluctuation in Guar is mainly on account of higher fluctuation in area 
and production of Guar seed depending on the spread and level of monsoon rainfall in the Producing centers and the export demand of Guar gum from the importing 
countries. 
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