Castor-Oil Stocks Seen Declining 16% Amid Reduced Indian SupplyRudy Ruitenberg
Stockpiles of castor oil, used as a laxative and a lubricant in race-car engines, are set to drop 16 percent by the end of September as lower supply from India forces demand rationing, Oil World said.
Global production will slide to a four-year low of 624,000 metric tons in the 2013-14 season through Sept. 30 from 648,000 tons a year earlier, the Hamburg-based oilseed researcher wrote in a report today. Ending inventories will fall to 97,000 tons from 116,000 tons, it showed.
India grows more than three-quarters of the world’s castor seed, and farmers in the country were discouraged from sowing after a record 2011-12 crop pushed down prices, Oil World said in May. China is the biggest importer of castor oil, followed by the European Union and the U.S.
“For the supplies in 2013-14, it will be decisive to what extent the sharply lower plantings in India will be offset by a recovery of yields,” Oil World said. “We assume a setback in Indian production and exports of castor oil, necessitating also some rationing of import demand.”
Global imports of the oil are predicted to fall to 497,000 tons from 516,000 tons in 2012-13, the researcher said. India’s export shipments may drop to 455,000 tons from 474,000 tons, the report showed. China’s imports are seen slipping to 220,000 tons from 229,000 tons, while the EU’s purchases may decline to 150,000 tons from 156,000 tons.