Guar gains on export demand; chana on low-level buying.

MUMBAI: India's guar seed futures rose more than 1 per cent on Thursday, bolstered by export demand for guar gum, weak arrivals and concerns over the monsoon, analysts and traders said. Most of the guar cultivating areas of Rajasthan have received insufficient and delayed showers, hampering sowing and hurting the growth of the sown crop, they added.

Planting of guar commences from beginning of June in the irrigated areas, while farmers in non-irrigated areas sow after mid-June, when monsoon rain reaches Rajasthan. "Sowing operations are slow in northern Rajasthan as farmers are still waiting for good showers. This is the main factor that is driving the market up," said Chowda Reddy, senior analyst from JRG Wealth Management.

The most-traded August guar seed on NCDEX was up 1.27 per cent at Rs 2,548 per 100 kg. Industrial guar gum is the most sought after guar product, and accounts for about 45 per cent of the total demand. Industrial gum is used as a controlling agent in oil wells to facilitate easy drilling and prevent fluid loss. In the Jodhpur spot market, guar seed gained Rs 42 to Rs 2,443 per 100 kg.

CHANA: India's chana futures moved up in the afternoon trade on buying interest near support level after falling for 2 straight sessions and on some inquiries from millers, analysts said. "Prices are not likely to go below Rs 2,265 (August contract) as it is a very good support level. Lower level buying may support prices," said an analyst from JRG Wealth Management.

August futures contract on the National Commodity Derivatives Exchange was up 0.31 per cent to Rs 2,291 per 100 kg. "Demand is steady. Millers are showing interest. Prices are likely to move up," said a trader from Delhi. Demand for chana dal and flour usually goes up during monsoon months as supply of vegetables drops in wet weather and also due to the start of the festival season in August.

In the Delhi spot market, chana inched down Rs 2.5 to Rs ,185.50 per 100 kg. According to the third advance estimates, the production of chana in 2009/10 is likely to be 7.38 million tonnes against the actual production of 7.05 million tonnes last year, official data showed.

Source : Economic Times