The price of sesame in India is largely influenced by both domestic factors and foreign demand, with current trends indicating some important developments.

According to data from the Union Agriculture Ministry, the domestic production of sesame during the Kharif season is expected to show a slight improvement, rising by 3,000 tons to reach 3.98 lakh tons this year, compared to 3.95 lakh tons last year.

This increase is despite a reduction in the area under sesame cultivation, which has decreased by 93,000 hectares, from 12.24 lakh hectares last year to 11.31 lakh hectares this season. The production boost is mainly attributed to an improvement in the average yield rate.

However, analysts caution that the overall production may be less than anticipated due to damage caused by floods and rains in certain regions, as well as weak arrivals in markets, which suggests a potential decrease in output.

This limited supply, coupled with strong demand, has led to a rise in sesame prices by Rs 700-800 per quintal recently, and prices are expected to increase further by Rs 500-700 per quintal in the near future.

The sesame business in the domestic sector is expected to remain stable, but its price will increasingly depend on export demand.

While the Central Government has raised the Minimum Support Price (MSP) for sesame by 7.30%, bringing it to Rs 9,267 per quintal, prices in local markets like Chhatarpur and Gwalior are higher, ranging from Rs 11,000 to Rs 12,100 per quintal.

Export demand is reported to be satisfactory, with expectations that prices could rise slightly due to festive demand around Makar Sankranti. After this period, however, market activity is expected to stabilize.

In summary, while sesame production is showing modest growth, its price dynamics will be heavily influenced by external factors, particularly export demand and seasonal variations like those linked to festivals.