Since the beginning of this month, the sesame seed market has been a volatile one. Despite starting the month on a high note compared to last month, i.e., $1,45 per kg FOB from $1,44 per kg FOB, the market experienced a price drop the next day. However, with the arrival of Korean Tender, where India and hype over the price due to India getting the signed contracts, the prices once again went northward and reached the month date high at $1,46 per kg FOB.
After staying stable for a couple of days, the downward trend started at the sesame seed price dropped to $1,43 per kg FOB before moving up to 1,45 per kg FOB.
The above prices were quoted for White Natural 99/1/1, but the trend was similar for all the white sesame seed varieties throughout the month to date. However, the Black sesame seed varieties were the only ones that remained stable and a sudden surge in its demand during the middle of the month helped the prices to climb high.
On Wednesday, irrespective of the variety and type, the prices for Sesame seed went up. According to traders and market analysts, the costs will stay stable, and there won’t be a downward trend anytime soon. A couple of factors will work in favour of the sesame seed prices in the coming days.
There is a good demand for the crop, mainly the White Hulled Sesame Seed Auto Dry 99.98% in the EU market, and the offer is $2490 per kg CIF and $2100 per kg FOB. Hence the exporters will start buying for the item to fulfil its demand. The exporters who got the Korean sesame seed tenders have not completed their purchase from the market yet, and in the coming days, they will be covering that too. As a result, the prices are unlikely to go down for the crop anytime soon; somewhat, it is expected to boost.
The future of sesame seed is still unpredictable, mainly for 2022, because of the heavy rain farmers fear crop damage in Rajasthan, Madhya Pradesh, and Uttar Pradesh. The supply of the new crop in the coming days and its demands after the buyers fulfil the need for the sesame seed for the EU and Korea will determine the price of 2022.
There is already a report that Madhya Pradesh’s new crop, which arrived in about 7.000 to 8.000 bags, has a shortage of good quality crop and about 40 per cent of it is defective. These factors will impact the price of Sesame seed in the coming months.
According to market analysts and experts, there are quite a few reasons that the market for sesame seed will continue to be bullish in the coming months and even the year 2022 because of factors like there is no drop in the consumption of the product in China. Next, since Japan reduced its import and stock for 2021, they will be importing sesame seeds for 2022, and they might look towards Africa for the crop because of India’s shortage in production. Furthermore, with the world getting out of COVID-19 restrictions and the consumption of the products improving over time will have a positive impact on the price.
Despite India’s shortage in crop production for 2022, Africa has fewer crops than last season, while Sudan’s port blockage and equipment shortage will make importers look towards the former two countries. With the increase in freight price and lack of containers, the prices are expected to go bullish for sesame seed in the coming days.
However, the future of sesame seed prices in India can experience a bit of a bearish trend to factors like the existing high stock of the product in a Chinese port, which is about 200 to 210 KMT. The arrival of the new COVID-19 variant can put a cap on the demand, along with China might look towards Pakistan for the crop instead of India. Pakistan already has excess production in sesame seed, and the country is nearer to China than India. With rising freight prices, cash constraints are felt across the globe. China might prefer to procure the product from Pakistan. Another factor that can prove detrimental for India’s sesame seed price is the shrinking market for processed sesame seed after the ETO incident and countries looking for an alternative product.
Despite these possible unfavourable factors that can negatively impact the prices of sesame seeds in India, experts believe the product will continue to have a bullish trend in the future. The traders and farmers of sesame seed shouldn’t be worried about slight changes in the market because the demand will continue to be stable.
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