Mustard seed is quoting at Rs 5,800 per quintal in local markets, 24.73 per cent higher than the minimum support price. The government had set the MSP for the rabi season at Rs 4,650.
Traders said higher prices of edible oils in the international market are boosting mustard oil rates with limited possibility of cooling off going forward.
Abhijit Banerjee, senior manager at brokerage Religare Securities, said imported edible oils are quoting at high levels, which has boosted the consumption of mustard oil, while the crude palm oil price also remains high.
One major reason behind the increased consumption of mustard oil is its purity, analysts said, adding that higher prices of imported oils have left no scope for adulteration in mustard oil, due to which the consumer is enjoying the commodity in a pure form.
At 4:58 pm, mustard seed futures for April 20 delivery quoted Rs 12 or 0.21 per cent lower at Rs 5,684 per quintal on the National Commodity and Derivatives Exchange (NCDEX).
India mustard output this year is projected at 104.27 lakh tonnes. However, the Central Organisation for Oil Industry and Trade (COOIT) and the Mustard Oil Producers’ Association (MOPA) have estimated the production at 89.50 lakh tonnes.
