Mustard dropped due to sufficient arrivals and higher production

Mustard prices in the spot market dropped by 0.71% to trade near 5462 due to sufficient arrivals and higher production of mustard so far this year. Mustard crop production is estimated to be around 115.25 lakh tonnes (lt) in 2022-23, according to the Solvent Extractors’ Association (SEA) of India. SEA had estimated the crop at 110 lt in 2021-22. The mustard arrivals in mandis were reported at 224,036.53 MT, which increased by about 56% from the previous week. The Centre’s policy of low import duty on vegetable oil was one of the factors for the fall in mustard prices. 

Pressure is also seen due to the continuous weakening of the prices of imported edible oils due to fears of a global economic slowdown. According to traders, the daily arrival of mustard in the producing mandis is continuously increasing, and the industry has released estimates of mustard production in the current season to be more than 22 percent compared to last year. The price of new mustard has also come down from Rs 4,800 to Rs 5,200 per quintal in the producing mandis, while in the current Rabi season, the central government has fixed the minimum support price of mustard at Rs 5,450 per quintal. The procurement of mustard at MSP in Haryana mandis will start on March 15. Therefore, because of the increasing arrivals of mustard, oil mills are buying only according to the need creating downward pressure continuously on prices.