Mus­tard Oil Set to Slide on Ris­ing Out­put

The Economic Times - - Finance & Commodities - Mad­hvi.Sally@ times­group.com

New Delhi: Mus­tard oil prices are ex­pected to fall 5% in March as farm­ers have in­creased cul­ti­va­tion by 9% and out­put is ex­pected to rise 16% to 79.12 lakh tonnes, ac­cord­ing to gov­ern­ment es­ti­mates.

“Mus­tard crop ar­rivals have be­gun and will pick up by the com­ing week. A price cor­rec­tion of .₹ 4-5 a litre will be there by mid-March when the new crop is milled,” said Sanjeev Giri, busi­ness head, ed­i­ble oil, Mother Dairy.

In the Delhi whole­sale mar­ket, bulk mus­tard oil (loose) price was be­ing quoted at .₹ 780-810 per 10 kg while the pack­aged va­ri­ety was priced at .₹ 85-110 per litre, said mus­tard oil com­pany ex­ec­u­tives.

“The trend in prices is very bear­ish. Since Jan­uary, we have re­duced mus­tard oil prices by .₹ 5 a litre in re­tail and can fur­ther re­duce by .₹ 1-2 a litre in March, if the gov­ern­ment doesn’t step in to buy mus­tard seed at min­i­mum sup­port price (MSP) and mus­tard seed oil meal prices re­main sta­ble,” said Vivek Puri, MD, Puri Oil Mills.

He said mus­tard seed prices in Ra­jasthan and Haryana man­dis had breached MSP and were at .₹ 3,570 a quin­tal on Thurs­day. The gov­ern­ment has fixed .₹ 3,700 a quin­tal as MSP for mus­tard for this sea­son.

Mus­tard meal is an im­por­tant source of cattle and poul­try feed and its prices in­di­rectly im­pacts oil prices. Companies are also ex­pect­ing con­sump­tion to re­vive to pre-drought years with in­crease in pro­duc­tion and drop in prices. “In whole­sale, prices have cor­rected since the past two months by .₹ 15 a litre and they will con­tinue to fall till Holi,” said Vijay Data of Vijay Solvex. Ex­pected fall in prices Rise in cul­ti­va­tion

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