Guar gum exports likely to fall on global slowdown.

UMBAI: Guar gum exports from the country are expected to be lower at 1.8 lakh tonnes as against the earlier estimates of 2.3 lakh tonnes this

financial year, a research analyst has said. "Guar gum exports were initially estimated to touch 2.3 lakh tonnes in FY09, but now the industry expects it to be 1.8 lakh tonnes only," Angel Commodities Research analyst Vedika More said.

"India exports around 75-80% of its guar gum annually. The global economic slowdown has led to a drastic fall in exports of guar gum from India in FY09," she said.

Guar gum is a thickening agent used in a wide range of processed foods. India produces about 80-90% of the world’s guar gum, a total of about 200,000 tonnes per year. Guar prices are trading in a narrow range since last two to three weeks.

This is because good domestic demand at lower levels limits the downside, whereas, sluggish export demand is capping the gains at higher levels, she said. Guar prices have tested their three-year low of Rs 1,400 in the current season (October-September 2009). The long-term price trend in guar will depend on overseas demand. Also, the long-range weather forecast of the Indian Meteorological Department in April would decide the further trend in guar.

"We expect prices to trade in the range of Rs 1,575- 1,675 per quintal in the short-term. In the medium to long-term, trend in guar complex would depend on overseas demand from the US and China," she said.