CASTOR SEED………. “Obsessed With Profit”

Castor, being a non-edible oilseed, has economic importance of its oil yielding seeds.Usage of castor seed products has grown tremendously over the years due to their biodegradable and eco-friendly nature. Looking at the profit it has given to the portfolio, it seems like the nature has blessed the investors, as if money sprouting out of the shiny seeds of castor plants.

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Consumption Pattern: The average Indian consumption of castor oil is 100,000 ton per year. The Indian variety of castor has 48 % oil content of which 42% can be extracted,while the cake retains the rest. On an average soap makers accounts for 25,000 ton while paint and allied sectors consumes 35,000 ton of the Indian consumption. In internal combustion engines, castor oil is renowned for its ability to lubricate under extreme conditions and temperatures, such as in air-cooled engines. The lubricants company Castrol takes its name from castor oil. Castor seed meal is offered in bulk & in plastic bags.

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Domestic scenario: India’s castor production fluctuates between 0.6 to 1 million tonnes a year. Castor is sown in August and harvested in Dec-Jan every year with majority of arrivals coming after February. Gujarat accounts for over 80% of India’s castor seed production, followed by Andhra Pradesh and Rajasthan.

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FACTS & FIGURES

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•Total area under Castor crop in India for the year 2009-10 is 7.40 lakh hectares. It has decreased by 10% as compared to previous year.

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•Estimated total production of Castor Seeds in India for the year 2009-10 is 9.34 lakh tonnes. It has decreased by 4% as compared to previous year.

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•Average yield for the year 2009-10 is 1261 kg/hectare as against 1180 kg/hectare during the year 2008-09. It has increased by 7% as compared to previous year.

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Kharif sowing: This kharif season the acreage under castor seed is far below the normal area of 8.130 lakh hectares. However, the good news according to the latest sowing data is that farmers have planted 1.252 lakh hectares which is more than the 1.115 lakh hectares covered at this time last year, are shifting from castor seed to cotton. The spurred kharif sowing figures of 66.090 lakh hectares under cotton as compared to 48.470 lakh hectares last year, itself depict that farmers this time have brought in more land under cotton. The reason being is the reaping profits from the later.

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EXIM scenario: Every month 40,000 tonnes castor oil and 5,000-8,000 tonne castor derivatives leave for foreign shores from India, From India castor oil is exported through mainly Kandla port. India exported more than 2.25 lakh ton castor seed till June this year compared to 1.22 lakh ton in same period of previous year. In May India exported 54000 ton castor oil. China imported 90000 ton castor oil in June only this year. Indian Government is providing 5% tax rebate to castor seed & oil exporter under Vishesh krishi and gram udyog yojana.

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…….. At the futures trade (Source: Forward market commission)

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•The Rajkot Commodity Exchange Ltd., Rajkot – The near month contract (i.e. June 2010) was quoted at its highest at Rs.3490/- per 100 kg on 30.6.2010 and at its lowest at Rs. 3159/- per 100 kg on 16.6.2010. During the fortnight, the total value of trade was Rs.354.95 crore. The net open position in the near month contract was at its highest at 25 MTs on 16.6.2010.

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•Bombay Commodity Exchange Ltd., Mumbai – The near month contract (i.e. August 2010) contract was highest price at Rs. 3522.00 on 30.6.2010 and lowest price at Rs.3256.00 on 16.6.2010. During the period, the total value of Castor seed was Rs.2.20 crore.

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Current scenario: Due do increase in demand in international markets, the prices of castor seed has increased by almost 15% recently and crossed the level of Rs 700/ 20 kg first time. Despite good monsoon in castor seed growing states the prices is not likely to go down as better demand from US, China and Europe.

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The snap shot of the future markets shows that the price is at a year high at Rs. 3748/ quintal giving a return of whooping return of 32% as on 13th July, 2010 from the year beginning. The forward month contract are in contango situation. The upward momentum can remain intact until the arrivals of new crop.

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2 responses to this post.

  1. sesam seed, cumin seed (JEERA), chana, rmseed, potato, etc commodity item news, report or prices of international market or demand their.

    thanks sunil

    Reply

  2. Posted by The Blogs Rocket on July 21, 2010 at 4:26 PM

    Very nice article, thanks! I’ve subscribed to your RSS feed. Please keep up posting.

    Reply

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