MUMBAI, 17 November 2025: The sudden boom in the castor oil market, which was suffering from recession, seems to have brought new life in trade. However, when the market booms, it also brings many reasons for the boom. This time too, there is a similar situation.
Market experts give reasons for this boom, ranging from the effect of weather to the reduction in carry forward stock and concerns about crop spoilage. According to traders' calculations, on the one hand, exporters started buying, on the other hand, this time the carry forward stock is less than the average stock of the last three years, which has had the biggest impact on the market.
On September 26, the price of castor oil per quintal in NCDEX futures was INR 6450. While on November 11, it increased to INR 6895. The effect of unseasonal rains was seen in the last fortnight.
Another group believes that with increasing consumption, the area under castor seed sowing has not increased as much as it should have. The government increased the MSP of crops like groundnut, cotton and soybean, so every farmer turned to other crops in the hope of higher returns.
Due to which the cultivation of castor oil was affected. Also, since the castor oil crop period is long, crops like gram or mustard seed cannot be grown in many cases. For this reason, farmers keep castor seed as the last option. It is reported that castor seed has been planted in an area of 9.18 lakh hectares in India for the 2025-26 season.
In 2024-25, it was planted in an area of 8.56 lakh hectares, while in 2023-24, castor oil was planted in 9.53 lakh hectares. Thus, the production was affected due to less planting last year. Due to which the carry forward stock decreased. This time too, the acreage is estimated to be less than the previous estimate. Which indicates a shortage of supply going forward.
In the year 2024, India exported 694510 tonnes of castor oil worth INR 8578 crore, while in the previous year, i.e. in the year 2023, it exported 629418 tonnes of castor oil worth INR 8190 crore. From January to August of 2025, India has exported 477409 tonnes of castor oil. Out of which, it has earned foreign exchange worth INR 6331 crore. If the price remains high, then even low exports can increase the income.
Gujarat is the largest producing state of Castor seed. This time, it is reported that it has been cultivated in 6.94 lakh hectares. Rajasthan has cultivated 1.88 lakh hectares. In addition, it is reported that Telangana and Andhra Pradesh have been cultivated in a combined area of 36,000 hectares.
While in the 10-month period from January-25 to October-25, 197,500 tons of castor seed have been consumed in India. From January-2025 to the end of the second week of November-2025, 16,96,384 sacks of castor seeds arrived. If the current boom continues for a long time, a large stock of old castor seed may be dumped in the market.
However, traders often trade by taking advantage of the difference between the spot price and the NCDEX futures price. Apart from this, they also take advantage of the difference in the prices of the two futures. Currently, there is no opportunity for such trading. But investors will have to keep an eye on the futures price. So that if this opportunity arises, they can take advantage. Currently, an average of INR 60 crore is traded daily in NCDEX futures. While the open interest is 38,000 tons.
