According to market reports, the international demand for hulled sesame is under disruptive mode. As a result, the export is low. Also, the price of Indian sesame is the highest in the international market. Hence the demand is down for the product in the global market.
These factors are causing the commodity to face a southbound price in the last few days.
Current International Scenario
Nigeria’s sesame prices have improved, mainly in Bauchi and Burkina Faso varieties. For example, Natural Sesame Seeds sold at Bauchi are around $1,49 per kg to $1,50 per kg, whereas the price for the Burkina Faso variety is $1,55 per kg. However, the availability of sesame seeds from Burkina Faso is minimal since the stock is low.
The price of red sesame from Sudan has also moved up to $1,39 from $1,38 per kg. El Gadarif’s sesame seed price is stable at $1,53 per kg, which increased from $1,48 per kg. There has been an increase in the currency rate against the dollar price by 15 to 20 per cent. Also, the hike in the freight rate has resulted in less availability of Sudanese sesame in the international market.
There is already a stock of more than 200 thousand tonnes of sesame seed in the Chinese port. Adding to this the steady increase in COVID-19 cases and the implementation of lockdown, the demand for the commodity is weak.
India is facing quite a bit of challenge with the hulled sesame seed. Every year India exports 13 thousand tons of hulled sesame seeds to Russia. But due to the war, there is no import from Russia currently. Adding to this, the previous quantity that has been exported to the country is still unpaid. Exporters started getting paid for their shipments now.
There are reports that some shipments got in the middle due to the geopolitical crisis in the region. The decrease in the export of hulled sesame in India has resulted in low import of the product. For example, India imported 125 thousand tons of white sesame seed; now, it’s down to 25 to 27 thousand tons.
India’s other export country, Korea, can also fail to provide good demand. There are reports that the Korean companies that put forth the tender already have 60 to 70 per cent stock. Therefore, it can lead to low demand for the product in the coming days. Moreover, India is also under the watch-list for the following tender from Korea. Since, for the last tender, 2,700 tons got rejected. Korea has now implemented 523 types of testing of pesticides for the sesame seed they import. It will lead India to face immense challenges in getting their product approved by the companies.
Nigeria and Sudan fulfil the demand for hulled sesame for the European countries because the prices are less than the Indian variety. Also, the freight price increase makes Europe look toward other countries instead of India to fulfil its demand.
The overall demand for white sesame is deficient in the international market. India will have the arrival of summer season sesame from May. The market will get flooded with new sesame seeds from Tanzania and Mozambique. All these factors, along with low import demand, will keep the market bearish for the coming days for all varieties of sesame seeds. According to market experts, the price can improve after the mid of April, but there is still uncertainty about that.