Lingering rains may push up groundnut oil prices

Spot groundnut oil prices are seen moving up by Rs 10-15 per 10 kg if the heavy monsoon showers continue in the main groundnut growing areas of Gujarat, traders said today.

The downpour might delay harvesting of the standing groundnut crop, putting pressure on supply, they added.

"Heavy showers are continuing in the groundnut growing areas of Ahmedabad, Baroda, Rajkot and Surat for the last 48 hours, and if this spell continues for another two-three days, water logging could cause damage to the standing crop," a Rajkot-based trader, Monik Bhai, said.

Currently, spot prices are around Rs 520 per 10 kg, but they can move up by Rs 10-15 if the rains do not stop, he added.

The traders said the main groundnut growing districts of Ahmedabad, Rajkot, Baroda have seen an average of four- to six-inch rainfall in the last 48 hours.

"Farmers were planning to harvest the standing groundnut crop this week but have been held up due to the heavy rains," another trader said.

Industry officials see the groundnut crop from the state at around 2.0-2.2 million tonne as sowing has been satisfactory.

"We were quite hopeful that a good harvest would come out this year, as the crop has been sown in around 1.9-2.0 million hectares, but these rains might force us to revise the target," said yet another trader.

Meanwhile, the first groundnut crop of this season has started arriving in the wholesale markets of Rajkot.

"Around 30 bags (1 bag=35 kg) of the new crop had arrived in Rajkot mandis (markets) before the rains stopped supplies," Monik Bhai said.

"The crop has around 20 per cent moisture, but the worrying factor is 20-30 per cent of sprouts, which shows that the crop coming out of the early sown varieties is not up to the mark," he said.

Gujarat is the main groundnut growing state of India, followed by Maharashtra. The crop is cultivated in around 1.9-2.0 million hectares of land.