Bangalore: The Gaur Gum exports are reportedly to rise up to 17 percent in 2012 because of positive and healthy demand from the oil gas companies. With the oil drilling technology developing there are hopes of higher production of guar seed cultivation in this coming kharif (rainy season). The developing criteria’s has made Guar Gum the most demanding commodity of the year.

The price for Guar Gum in December is two and a half times more than the January price in 2011. The January 2, 2011 price was 6,364.30 per quintal which has risen to 22,568.45.

Guar Gum is extracted from guar seed, which is used in oil well fracturing, oil well stimulation, mud drilling, and to manufacture stabilizers and as thickener in many food products. The Forward Markets Commission which surveys the future market in India predicted a specific margin for the demand but this growth seems to be unending. Guar Seed, which is the ultimate source of guar gum, has also attained momentum in the race. Its price also has increased from 2,334.30 to 6,789.

Purshotam Hissaria, the President of Indian Guar Gum Manufacturers’ Association, told Reuters, “Guar gum exports in 2011/12 are expected to touch 350,000 tonnes against more than 300,000 tonnes shipped a year ago. If we get good rains then definitely production is going to be better than last year as it is the most lucrative crop after cotton and exports may easily touch 350,000 tonnes. The major demand is coming from oil and gas companies of U.S. and Europe and this demand is expected to remain firm in coming months as well.”

In the prospect of spending 100 for the material in January 2011, the highest profitable commodity is Guar Gum, then Guar Seed, which would earn around 354.64 and 290.85 respectively. The third place is accumulated by pepper, which yields 150.59 for every investment of 100. Its price has increased from 22,192.85 to 33,421.05.

Furnace oil and heating oil are the next best commodities which return 49 and 40 rupees in expense of 100. This list is followed by Nickel, Natural gas, Raw Cotton, Raw Jute and Turmeric, being the most awful commodity.

In terms of returns guar gum has beaten the profits made from gold. In the period December 2010 to December 2011, the guar gum returned a profit of 269 percent, whereas gold has made only 32 percent. India is the producer of around 80 percent of the guar crop of world and this high demand has reselted in such abnormal profits. Naveen Mathur, the associate director of Angel Broking said, “We expect that support to upside on gold prices will remain a economic risks may worsen, which may lead to safe haven buying for gold.”