Guar prices likely to rise on supply constraints
Mumbai: Guarseed futures, which came under pressure last fortnight due to the European Union's report on pesticides in export shipments, likely to go up on supply constraints. Commodity analysts and marketmen maintained that the coming days could see a surge in prices. The highly speculative grain commodity went down below Rs 2,000 a quintal a week ago and is still trading below Rs 2,000. The country witnessed an overall production of around 8.5 million quintals in 2007-08 against the earlier projection of 12 million quintals. Arrivals in mandis of Rajasthan, the biggest producer of guarseed, has slowed down in the last few weeks as the new season is nearing. Guargum (finished product from guarseed) is used for maintenance and repairmen of crude oil wells. According to commodity analysts, the Rs 1,920 a quintal level offers support to the near-month contract, whereas it will face resistance at the Rs 1,952 level. Marketmen in Rajasthan are bullish on the guarseed market. According to them, the May and June futures could touch Rs 2,300 and Rs 2,400 a quintal mark respectively. On the National Commodity and Derivatives Exchange, the April contract for guarseed closed on March 20 at Rs 1,938 a quintal against the previous close of Rs 1,934 a quintal.
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