Sesame exporters eye quick buck

Sesame seed exporters are reneging on their commitments following a 40 per cent rise in the price of the commodity over the last 45 days.

A majority of the exporters are believed to have sent revised quotations with higher prices to buyers abroad ignoring old contracts.

While the revised quotes are not acceptable to buyers, many, according to market sources, are entering into new contracts at higher prices from sheer necessity.

In the domestic spot market, good quality sesame seed is quoted at Rs 5,000 a quintal, a rise of 28 per cent or Rs 1,100 a quintal over the last one month. In the last 45 days, the oilseed prices have shot up by 40 per cent.

Although no trade was reported in the commodity on the country's two commodity exchanges, prices have gone up shot up by 14 per cent in the last one month, with January delivery on NCDEX quoted at Rs 4,244 a quintal and on MCX at Rs 4,338 a quintal.

"Some defaults have occurred as traders have succumbed to rising prices. But we do not have the power to take action against defaulters," said Sanjay Shah, chairman, Indian Oilseeds & Produce Exporters Association (IOPEA).

Shah, who denied receiving any such complaints, said the country's interest should be of paramount importance to exporters, who should refrain from indulging in such practices.

"I have heard that some small players are not meeting export commitments and, thereby, are maligning the image of the country. But this will not have any impact on large scale and reputed players," said an exporter on condition of anonymity.

Chinese importers, who depend solely on Indian imports, have been badly affected.

Reportedly, China has almost a "nil" crop this year, putting the nation at the mercy of Indian exporters to meet the demand between October and January. Additionally, the crop in Africa is also of sub-standard quality which does not meet international specifications.

Chinese importers are left with no choice but to depend on the Indian crop which is harvested during their peak demand period.

Sesame seed is a two season crop in India. During the last kharif season, India's total production was estimated at 422,000 tonnes. No data have been compiled so far for the ongoing rabi season.

India's total exports of sesame seed is likely to hit 250,000 tonnes compared with 231,000 tonnes last year.

China is the largest Indian sesame seed importer with a total shipment estimated to touch 100,000 tonnes this year compared with 80,000 tonnes last year.

Anticipating a drastic price decline, nearly 80 per cent of the importers across the globe had failed to hedge. But with the price rising continuously, consumers are ready to pick up the commodity at any rate.

Of late, Chinese buyers have also started aggressively covering their positions, which, according to market sources, is too late.