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Castor seed seen up on rising crude oil

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Newswire18 Ahmedabad
Last Updated : Feb 05 2013 | 3:36 AM IST
Castor seed futures and spot prices are likely to remain firm in the coming week on the back of rising prices of crude oil and oilseeds in global and domestic markets, traders and analysts said today.
 
"Castor seed prices will climb up further in the spot and futures market. All the fundamentals suggest this. However, this is the first time after a long period the castor seeds are trading firm," said Ruchi Shah, analyst with Kunvarji Commodities.
 
According to analysts, high prices of other castor derivatives will also contribute to the price increase. Soyoil prices are firming again after a minor 10-12 per cent correction last week, they said.
 
"European buyers are willing to buy castor oil cakes at $130 a tonne, which is almost a 50 per cent increase from the same period a year ago," said Prakash Mehta, an Ahmedabad-based castor trader and exporter.
 
Arrivals
Castor arrivals are likely to come down in Gujarat and Rajasthan following the festival of Holi on March 21. At present, daily arrivals in Gujarat are stable at 70,000-75,000 bags (1 bag=70kg).
 
Arrivals in Hyderabad are currently around 2,000-2500 bags a day.
 
"However, the arrivals are not likely to have any effect on castor seed prices as extractors have enough stock with them to last for some time. The prices will move on international trends," said Bhavik Thakkar, an Ahmedabad-based castor trader.
 
Futures
The most active castor seed April contract on National Commodities and Derivatives Exchange is likely to hit Rs 555-560 per 20 kg level provided the support from international commodities continues.
 
"If the April contract breaks the resistance at Rs 545 it can go up to Rs 560 during the week starting from Monday," Shah said.
 
"This is one of the rare situations in castor trading as there is no arbitrage opportunity available," she added.
 
Spot and exports
Castor seed spot market prices are also likely to go up to Rs 545 per 20 kg from the current Rs 540.
 
"Some farmers are holding back stocks in anticipation that the prices will rise further," Thakkar said.
 
Castor oil exports have remained stable around 12,000-15,000 tonnes in February and the same export volume is likely to continue during March.
 
International buyers at Kandla are willing to buy high-grade castor oil at $1,375 (Rs 55,027.50) a tonne on delivery on free-on-board basis.

 
 

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