Mild selling was witnessed in Guargum futures today as a slight moderation in global crude oil prices clubbed with calls of a normal monsoon weighed on the sentiments. The NCDEX Guargum futures for May had tested a one month high of Rs 9200 per tone in last week before easing. Spot demand is fairly decent though the recent momentum seemed to have been shaped up by galloping crude oil prices and a weak Indian Rupee. Guargum is used in crude oil well franking and soaring oil prices tend to support the commodity via export demand.
Weak Rupee also supports exports. The counter currently trades at Rs 9073 per tone, down 0.44% on the day. The Application Laboratory of the Japanese national weather forecaster Jamstec has recently predicted a ‘wetter-than-normal’ condition for India in terms of the expected seasonally averaged rainfall this summer. This is likely to augur good for the coming guar crop which is purely rain fed.
The India Meteorological Department (IMD) has already forecast a normal monsoon at 97% of long period average for the country. Considering the Indian Ocean variability, India is going to witness the third successive normal monsoon with a quantitative figure of 97% plus minus 5%. The onset of monsoon is expected in Kerala from the end of May or the first week of June, and will cover the country in the next 45 days.