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Guar gum shipments may rise on shale drilling bids

India dominates the guar gum industry, commanding about 80 per cent of global production, followed by Pakistan.

, ET Bureau|
Last Updated: Jan 06, 2020, 10.47 AM IST
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Agri Commodities: Guar seed, guar gum futures fall on rising stockpiles
Guar gum is derived from guar seeds, a legume crop that grows in semi-arid regions of Rajasthan, Gujarat and Haryana.
The spike in crude oil prices following the killing of Iranian military commander Qassem Soleimani by the US could lead to a surge in exports of guar gum — an agent used for oil drilling and hydraulic fracturing in shale gas —in the coming weeks.

India’s gaur trade feels that the global oil drilling activities will go up if the geopolitical tension between the US and Iran heightens, resulting in crude prices moving northwards. Brent crude oil price rose over 4 per cent to $69.16 per barrel on Friday after US airstrikes in Baghdad killed the top Iranian commander.

The situation may prompt oil drilling companies in the US to boost drilling activities, guar gum industry players said.

India dominates the guar gum industry, commanding about 80 per cent of global production, followed by Pakistan. It’s mostly exported to North America, Russia, China, Mexico and Brazil.

brighter side

Guar gum is derived from guar seeds, a legume crop that grows in semi-arid regions of Rajasthan, Gujarat and Haryana.

Ravinder Kedia, director at Jai Bharat Gum & Chemicals, said US oil drilling companies had cut down their budgets, leading to a drop in gaur gum exports in the quarter ended December. “But in the fourth quarter we are hoping exports to move up which will help in bet-ter price recovery of guar gum,” he said.

Rajesh Kedia, director at gaur gum manufacturer Chimique India, said guar gum prices in December was 7-8 per cent higher than a year earlier. “This movement in price happened after Opec announced a cut in oil production.”

The industry is expecting to export 330,000 tonnes of guar gum this financial year, down from 360,000 tonnes in FY19. The country produced 750,000 tonnes of guar seed in this year’s kharif.

Guar gum powder is used are ice cream, chocolate, sausage, pasta, jams, and jellies among others as a gelling, thickening, clouding, and binding agent. It is also used for stabilisation, emulsification, preservation, water retention, and enhancement of water-soluble fibre content.

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