What Are The Factors Affecting The Mustard Prices Fall?
Mustard Prices Drop Due to High Arrivals
The mustard market has experienced a decline in prices due to an increase in supply from producing areas and weakened demand from oil mills. On the other hand, crude palm oil (CPO) prices saw an upward trend, especially in Kandla, driven by weak selling from importers. In the domestic market, mustard prices dropped significantly. This decline is attributed to an influx of mustard arrivals from various producing regions, with daily volumes reaching up to 0.4 million sacks. The increase in supply has resulted in oil mills showing less interest in purchasing at higher prices, further contributing to the price drop.Crude Palm Oil Gains Due to Weak Selling
While mustard prices dropped, crude palm oil (CPO) saw a price increase in Kanda. Due to weak selling by importers, CPO prices rose. The demand for crude palm oil has been bolstered by refined oil sellers and vegetable ghee manufacturers, who require CPO as a key input. This upward trend in CPO prices reflects the broader bullish sentiment in the edible oil market. Futures trading in CPO also witnessed a bullish sentiment, with speculators increasing their buying positions. The October futures for CPO, along with the delivery numbers, closed on a positive note in Kuala Lumpur's CPO futures exchange (KLC). This rally in CPO prices is expected to maintain upward pressure on refined oil prices in the near term. Thus, offering exporters opportunities to capitalise on higher market rates.Other Oil Market Trends
The broader edible oil market saw mixed trends. Cottonseed oil rose, and this increase was due to limited demand from vegetable ghee manufacturers and a weak supply. Similarly, refined soybean oil prices remained stable. On the other hand, castor oil experienced a decline. This drop was driven by weak industrial demand and a sluggish market for other oils. In Gujarat, castor oil prices remained slightly lower. Meanwhile, soap manufacturers displayed reduced interest in purchasing rice fatty oil, which caused prices to stagnate.The mustard market's recent decline, driven by increased arrivals and weakened demand, signals challenges for exporters. The simultaneous rise in crude palm oil prices, spurred by weak selling from importers, offers some relief in the broader edible oil market. Monitoring these shifts closely will be critical for staying competitive in the dynamic agricultural export market.