NCDEX Guar Gum

Contract Specifications of Guar Gum

NCDEX Guar Gum: Live Prices, Trading Insights, and Market Overview

Guar gum, derived from the guar bean, is a key commodity widely used in the food, pharmaceutical, and oil & gas industries. In India, NCDEX Guar Gum futures allow farmers, processors, traders, and investors to hedge against price volatility and speculate on market movements. NCDEX (National Commodity & Derivatives Exchange) provides a transparent and regulated platform for trading these futures, ensuring fair pricing and liquidity.

What Are NCDEX Guar Gum Futures?

NCDEX Guar Gum futures are standardized contracts representing a fixed quantity of guar gum, typically 10 metric tonnes per contract. These contracts are traded in multiple varieties (e.g., Guar Gum Split, Guar Gum Powder), each with specific quality parameters.

Key features:

• Contract Size: 10 MT per lot
• Tick Size: ₹1 per kg (varies by contract type)
• Settlement: Cash-settled or delivery-based
• Trading Hours: 9:00 AM to 11:30 PM IST

These contracts provide price discovery for guar gum and help stakeholders manage exposure to volatile raw material costs.

Factors Affecting NCDEX Guar Gum Prices

1. Crop Production: Guar gum supply is influenced by sowing area, rainfall, and yield in Rajasthan and Gujarat, the major producing states.
2. Global Demand: Guar gum is exported widely for use in hydraulic fracturing (oil & gas), food additives, and pharmaceuticals. Demand fluctuations directly impact NCDEX futures prices.
3. Government Policies: Export restrictions, minimum support prices, and subsidies influence domestic pricing.
4. Currency Movements: As exports are priced in USD, the INR/USD exchange rate affects domestic price levels.
5. Industrial Use Trends: The growing demand for guar gum in food, pharma, and oil & gas sectors drives market dynamics.

Trading NCDEX Guar Gum Futures

NCDEX Guar Gum futures are traded by multiple market participants:

• Farmers and Processors: Hedge against price volatility to ensure stable revenues.
• Exporters: Lock in global prices for international contracts.
• Speculators: Capitalize on intraday or seasonal price movements.

Common trading strategies include:

• Hedging: Locking in prices for future delivery to mitigate risk.
• Intraday Trading: Using technical indicators like MACD, RSI, and moving averages for short-term profits.
• Spread Trading: Pairing guar gum contracts with other pulses or oilseed derivatives to exploit relative price movements.

Historical Perspective

Guar gum has been a traded commodity in India since the early 2000s on NCDEX.

• 2000s: Prices were mostly stable, driven by domestic demand and export trends.
• 2010s: A surge in oil & gas sector demand for hydraulic fracturing caused dramatic price spikes. In 2012, guar gum prices reached record highs, prompting significant speculative activity.
• 2020s: Prices have stabilized but remain influenced by export demand, crop yields, and global market trends. Seasonal fluctuations continue to create short-term volatility.

Recent Update on NCDEX Guar Gum

As of September 2025, NCDEX Guar Gum futures are showing moderate upward movement due to:

• Increasing demand from the oil & gas and food industries.
• Tight supply caused by lower-than-expected yields in key growing regions.
• Export demand from the US and Europe driving international pricing.

Market participants are closely monitoring crop reports from Rajasthan and Gujarat, global oil prices, and currency trends to make informed trading decisions.

NCDEX Guar Gum vs Global Guar Gum Market

While NCDEX Guar Gum reflects domestic pricing, it remains closely linked to global markets. Major importing countries include the US, Europe, and the Middle East. Export demand, international trade policies, and shipping costs affect both domestic and international prices, making NCDEX a critical platform for price discovery.

Outlook for NCDEX Guar Gum

With guar gum being essential in food, pharma, and industrial applications, demand is expected to remain robust. Future price trends will largely depend on crop yields, government policies, and global industrial demand. Traders and processors can use NCDEX futures to hedge risk, speculate on price movements, and ensure price transparency in the market.

NCDEX Guar Gum Futures FAQ

Q. What are NCDEX Guar Gum Futures?

A. NCDEX Guar Gum Futures are futures contracts based on the price of refined guar gum splits, a natural polysaccharide derived from guar seeds used as a thickening agent in food, oil drilling, and industrial applications. Traded on the National Commodity & Derivatives Exchange (NCDEX) in India, these contracts allow traders to hedge against price fluctuations in the guar complex, a key agricultural commodity primarily produced in Rajasthan. The guar gum market is often highlighted in commodity news on platforms like Moneycontrol or Investing.com as an indicator of agricultural and industrial demand trends.

Q. What are NCDEX Guar Gum Futures Contracts?

A. NCDEX Guar Gum Futures Contracts are standardized agreements to buy or sell 5 metric tons of refined guar gum splits at a predetermined price on a future date, traded on the NCDEX platform. The contract value is based on the prevailing market price per quintal (100 kg), with tick size of ₹1 per quintal, offering high liquidity and volatility for profitable trades during sessions. For example, if you’re bullish on guar gum prices, you can go long on a futures contract, earning ₹50 per quintal increase (₹1 x 50 quintals per MT). Conversely, if bearish, you can short the contract, profiting ₹50 per quintal decline.

Q. What are the trading hours for NCDEX Guar Gum Futures?

A. Trading for NCDEX Guar Gum Futures takes place from 9:00 a.m. to 5:00 p.m. IST (Indian Standard Time) from Monday to Friday. Unlike global exchanges, there is no extended or overnight trading, and the market closes daily for settlement. This schedule aligns with Indian business hours, providing active trading opportunities during the day for local and international participants.

Q. Why and when were NCDEX Guar Gum Futures created?

A. Guar gum, extracted from the guar bean (Cyamopsis tetragonoloba), has been a vital commodity in India since the early 2000s due to its export demand for hydraulic fracturing in the U.S. oil industry. NCDEX Guar Gum Futures were launched in 2004 by the National Commodity & Derivatives Exchange to enable farmers, processors, and traders to hedge against price volatility in the guar complex. Designed to support the agricultural economy, particularly in guar-producing regions like Rajasthan, these futures serve as a critical tool for price discovery, risk management, and stabilizing the supply chain for food and industrial uses.

Q. What are the risks and benefits of NCDEX Guar Gum Futures trading?

A. NCDEX Guar Gum Futures trading differs from traditional investing and carries significant risks. The volatility driven by weather, export demand, and global oil prices can lead to substantial gains but also rapid losses, making it unsuitable for conservative investors. Traders who can actively monitor the market and tolerate risk may capitalize on both long and short positions, as futures allow shorting without restrictions. However, without disciplined risk management, including margin requirements, traders risk calls if positions move unfavorably. The benefit lies in the potential for high returns due to leverage and liquidity, especially during seasonal spikes, but constant attention to monsoon patterns and U.S. shale activity is essential.

Q. How can I learn NCDEX Guar Gum Futures trading?

A. NCDEX Guar Gum Futures are a popular choice among agricultural commodity traders, but beginners often face challenges due to limited understanding of seasonal dynamics and trading strategies. Success demands a robust trading plan, strict risk management, and deep knowledge of the guar supply chain. Novice traders can accelerate their learning by joining online trading communities, NCDEX educational webinars, or live trading rooms led by experienced commodity traders. These platforms enable beginners to observe real-time analysis, learn strategies suited to their risk tolerance, and gain confidence. Using simulated accounts on platforms like TradingView before trading with real money can also minimize costly errors.

Q. What are other names used for NCDEX Guar Gum Futures?

A. NCDEX Guar Gum Futures are known by several names or aliases, including:

• Guar Gum Refined Splits Futures
• GUARGUM5 Futures (NCDEX symbol)
• NCDEX Guar Gum Live
• Guar Complex Futures
• Refined Guar Gum Futures