Hello everyone,
It gives me immense pleasure to share an update on castor market scenario. The year 2025 is another year of uncertainty driven by due to factors such as cross-border and tariff wars which created lack of confidence in business confidence globally. Castor industry is no exception.
This year, monsoon progression was favorable across most parts of India, particularly in castor growing areas of Gujarat and adjoining parts of Rajasthan. The early arrival of monsoon led to early sowing of several crops including castor. The early arrival of rains enabled an early start to sowing for several crops, including castor. Initially, the rapid pace of sowing led many market participants to anticipate a substantial increase in final acreage. However, the momentum slowed in the later weeks, resulting in a final castor sowing area of 0.95 million hectares, compared to 0.87 million hectares last year – an increase of roughly 9%. Sowing in 2025 began earlier than in 2024 but later than in 2023. Although total castor acreage is higher than last year, it remains below the 2023 level.
Castor sowing area in highest yielding state of Gujarat marginally increased from 0.64 to 0.68 million Hectares. Cotton and peanut account for nearly half of total cultivable land in Gujarat. While cotton acreage dropped sharply, it was largely replaced by peanut, resulting in no significant change for other crops. Historically, despite varying market and weather conditions, India’s castor acreage has remained remarkably stable, fluctuating around 0.9 ± 0.05 million hectares for more than a decade.
Beyond acreage, weather patterns up to harvest play a crucial role in determining yield and overall crop size. In recent years, crop estimates have been revised downward multiple times due to adverse weather. So far this year, weather conditions have largely been favorable for castor growth. Unseasonal rains in late October and early November delayed early arrivals but are expected to benefit non-irrigated fields. Minor damage was reported in pockets where sowing occurred just before the rains. New crop arrivals are expected to begin gradually in December and rise month by month, peaking around April.
Most trade participants predicted a drop of 10% in castor oil demand during 2025 on account of uncertain economic environment. Castor oil export from India during Jan-Oct 2025 is reported around 585kt as against 621kt, reflecting a 5.8% decline. Despite softer demand, castor seed prices have not fallen significantly because the 2025 crop size was about 20% lower than in 2024. A historically weak INR, trading above ₹89 per USD helped keep castor oil prices competitive in international markets. Castor meal prices have surged more than 30% in recent months, cushioning any potential decline in oil prices despite firm seed rates.
Considering the declared crop size, carry-in stocks, and export trends for 2025, the carry-out of castor seed and oil into next year is expected to be lower than in previous years. Although arrivals of castor seed from the new crop may continue rising steadily, it is important to note that a portion of old-crop seeds will likely be needed through February 2025 to fulfill crushing and export requirements. Weather conditions during the remaining harvest period will be critical in determining the final crop size. Additionally, factors such as exchange-rate movement, geopolitical developments, and ongoing tariff disputes will continue to influence global demand and must be closely monitored.
Wishing all ICOA members and trade participants a happy, healthy, and prosperous time ahead.
Shailesh Baldha
AWL Agribusiness Limited
*The opinions expressed in this newsletter are solely those of the author and do not necessarily reflect the views of The International Castor Oil Association. *