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Key Highlights

* Guargum plunges 6% leading the broader Guar Complex downturn.

* Guarseed slides 4.5% driven by geopolitical and tariff uncertainties.

* US sanctions on Russian oil disrupt trade, worsening market sentiment.

Key Drivers of Decline

1. US Sanctions and Tariffs

* The looming Sanctioning Russia Act of 2025, which could impose a 500% tariff on countries importing Russian petroleum, is a critical factor. Given that India is a significant producer of Guarseed and Guargum, these tariffs place immense pressure on both the Indian agricultural sector and the broader Guar Complex.

* The threat of tariffs is compounded by trade disruptions and uncertainty, which have led to a decrease in market confidence. These factors have a negative impact on both commodity prices and trading volumes.

2. Geopolitical Tensions

* Tensions between the US and countries dealing with Russian oil imports are making international trade riskier. Even though India has reduced its dependence on Russian oil, the potential for heavy tariffs has rattled markets globally, causing price fluctuations and uncertainty in commodities like Guarseed and Guargum.

Impact on Guargum and Guarseed

* Guargum saw a 6% drop, primarily due to reduced demand from international markets and increased market instability caused by tariff threats and geopolitical risks.

* Guarseed faced a 4.5% decline, largely due to trade disruptions and uncertainty in the global export market.

Looking Ahead

* The outlook for both Guarseed and Guargum remains volatile. The imposition of 500% tariffs could create a ripple effect on India's exports, increasing both risks and price volatility.

* Producers and exporters in the Guar sector need to stay agile, using strategies like cost management and hedging to cope with ongoing market instability.

* As global markets and currencies adjust to these geopolitical pressures, it will be crucial to monitor the developments around tariffs, the Indian Rupee's performance, and demand shifts in key sectors like fracking, food processing, and textiles.

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