As June 2024 comes to an end, the global Guar Gum market is all set for price fluctuations across both importing and exporting regions. Industry analysts are predicting a downward trend until month’s end in prices with India, the world's largest producer and exporter, at the forefront of this shift.

India, which supplies 80 percent of the global Guar Gum demand, has experienced a significant downturn in exports. For the fiscal year 2023-24, Guar Gum exports from India dropped approximately 12 percent in value, in the previous year. This decline is attributed to lower prices and reduced demand from key buyers, including the United States, Germany, and Russia.

The versatile nature of Guar Gum, extracted from guar seed, contributes to its widespread use across various industries. It serves as a thickening and binding agent in food, textiles, paper, pharmaceuticals, and oil sectors. Highly refined Guar Gum finds application in the food industry as a stabilizer in ice creams and cheese, and as a meat binder. Additionally, it plays a crucial role in the hydraulic fracturing technique used in shale gas and oil exploration, as well as in other industrial applications such as ore floatation.

Despite a rebound in exports following a recent low of $262.99 million in 2020-21, reaching a four-year high of $617 million in 2022-23, the current market faces challenges. The United States, the largest buyer of Indian Guar Gum, reduced its imports by approximately 29 percent in value terms during 2023-24, with shipment volumes down by 27 percent. Similar declines were observed in exports to Germany and Russia.

As of late May 2024, Guar Gum futures contracts for June were hovering around previous levels, with guar seed contracts also likely to show a similar trend. The Indian guar futures market eased on weak export demand, prompting traders to defer buying. This decrease in inquiries from importing regions in the previous month has led to surplus inventories in the Indian market, likely to keep prices subdued in the near term.

However, the importing nations May experience a contrasting trend, with a possibility of increased Guar Gum prices. As June commences, there has been a notable uptick in fresh demand from exporting nations, particularly in the higher tiers of the market. Both guar seed and Guar Gum prices have maintained their strength in physical and forward markets, driven by local demand.

The market is currently in a state of anticipation, awaiting the formation of a new government in India and the forecast for the upcoming monsoon season, both of which will significantly impact the new crop. Despite this uncertainty, exporters and manufacturers continue to fulfill existing orders diligently.

The current availability of guar seed in the market meets regular demand levels, but most manufacturing plants are operating at capacity to fulfill existing orders, with a minimal surplus. Export demand for Guar Gum and guar splits continues to originate primarily from Europe and China. As the Guar Gum industry navigates these complex market dynamics, stakeholders across the globe are closely monitoring price movements and demand patterns. The coming weeks will be crucial in determining the market's direction for the remainder of 2024.