Current Scenario
Mustard production is estimated to be 11 million tonnes this year compared to 8 million to 8,5 million tonnes last year. But the production has decreased in some areas due to extreme heat during March.
The Coronavirus affected the hotels, restaurants, and street food outlets last year and a half. It resulted in increased consumption of homemade food, which increased mustard intake. But over the previous six months, the Coronavirus situation has been stable, which has increased the food intake in the other food outlets instead of home. In addition, it has increased the consumption of cheap imported oil, which is not affecting the consumption of mustard oil. The lowering in consumption has now slowed down the activity of the purchase of mustard seeds.
Also, with the Government’s ban on blending mustard oil, the consumption of 20 to 40 thousand tonnes has decreased every month. Therefore, its effect of it is also visible in the market.
A couple of months earlier, the price of mustard oil was higher than groundnut oil, sunflower oil, soya oil, and cotton oil. But now the situation has become different. Now mustard oil is the lowest among the edible oils due to 30% more production.
The reduced price of mustard oil is also due to the disparity in crushing prices in the last month.
Despite the cheapness of mustard oil, farmers are getting reasonable prices due to domestic demand. It is due to Indonesia’s current ban on palm oil export and the decrease in import of sunflower oil because of the Russia – Ukraine war. But experts believe this trend won’t last for long.
There will be a decrease in the price of imported oil in the next one to two weeks as Indonesia will commence the export of palm oil. Experts have backed this theory at the Global Oil held in Dubai. Furthermore, it was added that it would eventually affect the price of mustard oil in India at the summit. Also, there will be no purity in making mustard refined.
Even the summer season and its heat have decreased the consumption of all edible oils, affecting the mustard seed prices.
In the current season of mustard, now the stock is only with the farmers and crushing mills. Therefore, most stockists, commodity exchanges, or multinational companies have zero mustard stock in the current year. With this knowledge, farmers will supply mustard seeds in low quantities until the prices increase.
Prediction
There is no possibility of any increase in the price of mustard oil in the coming month. A month later, with the onset of the monsoon season, the consumption of mustard oil will increase. But as of now, till June 15, demand in the market will remain slow.
Also, there is the possibility of reducing soybean sowing due to prices. Furthermore, the sowing of mustard may also decrease in the coming season due to the high prices that the crops like wheat, cumin, coriander, garlic, and isabgol are fetching. With this, the effect of all these can be seen in the price of mustard after a month.
It is also predicted that the supply of mustard will remain intact after the onset of the monsoon. Therefore, it will eventually support demand. As a result, mustard and mustard oil prices will remain range-bound during the next month.
According to market experts, there is no possibility of the mustard seed market becoming bullish in the next month. Furthermore, it might reduce to $0,90 per kg, which is unlikely to go beyond $0,95 per kg.
Price Trend
Brown Mustard Seeds Micro Machine Clean
| Date | Price |
| May 17 – 19 | $1,00 per kg FOB |
| May 10 -16 | $1,03 per kg FOB |
| May 2 – 9 | $1,02 per kg FOB |
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