Castor Seed

Overview

  • Castor seed is a non-edible oilseed crop, with average 46% oil recovery. Castor oil (extracted from castor seed) and its derivatives have an indispensable usage in many industries like cosmetics, surface coatings, toiletries, pharmaceuticals, perfumes, soaps, medicines and lubricating formulations. Castor oil is used either in crude form or in refined hydrogenated form in these industries.
  • Castor plant (Ricinus communis) is grown in arid and semi-arid regions of the world. India is major producing country followed by China, Brazil and Thailand. In India, it is kharif crop, sown in July and August, while arrivals start December onwards and continue till March. Gujarat is major producing state in India, which accounts about 80% of domestic production, followed by Andhra Pradesh and Rajasthan. These 3 states account for about 96% of the total castor seed production in India.
  • India is the leader in global castor seed production and dominates international trade in castor oil, meeting about 80% of the total global demand of this commodity. China and Brazil are its other producers. China, US, EU, Japan are the major importers of Indian castor oil.
  • The realities of the market call for efficient price risk management technique that are important for stakeholders, such as producer, exporters, marketers, processors, and SMEs. When the future is unknown, modern techniques and strategies, including market based risk management financial instruments like “Castor Futures” offered on the MCX platform can improve efficiencies and consolidate competitiveness through price risk management.

Factors Influencing the Market

  • Domestic demand-supply scenario, inter crop price parity, cost of production, and prevailing international prices are major factors that influences prices in the castor seed market and that of its derivatives like castor oil.
  • Weather conditions, pest, diseases and other risk factors associated with agricultural crops.
  • Government policies on import, export and other interventions
  • Prices of other competitive oils like hydrogenated oil, dehydrated oil, sulphated and sulfonated oil etc.
  • Currency fluctuations

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