Sesame Seed Market Report 2021 & Beyond

Sesame seed is preferred world over for its taste, aroma, color, crunchiness, and nutrients. Considered as one of the wonder foods of nature, sesame hosts an incredible array of nutrients including 50% fat, 23% carbohydrates, 18% protein and 12% dietary fiber. Increasingly, sesame seed usage has spread beyond bread and confectionary to a variety of food preparations as an important food ingredient.

World sesame seed production is estimated at around 4. 8 million tons with 10 countries – Myanmar, India, China, Tanzania, Sudan, Ethiopia, Nigeria, Burkina Faso, Uganda, and Niger accounting for over 80% of the production. Africa collectively accounts for over 45% of the crop and in the last 10 years has grown in stature as a fast-growing supplier of sesame seed to the world market.

Of the global production, over two million tons are exported every year mainly to China (one million tons), Japan (150,000 tons), Turkey (150,000 tons), European Union (150,000 tons), South Korea (100,000 tons) and Vietnam (100,000 tons). USA, Saudi Arabia, UAE are other importers. Natural sesame seed and hulled are two popular forms in which most of the trade takes place.

Indian Sesame Crop 2020:

In a year of a record sowing and an anticipated higher crop, the sesame seed growers are staring at an uncertain future following the coronavirus-driven global trade disruptions. Farmers from Gujarat hopped onto the sesame-seed bandwagon this summer sowing season with cultivation area of the oilseed rising by three times over the past year.

The State Agriculture Department data showed sesame seed area jumped from 18,887 hectares (ha) last year to a 58,178 ha this summer sowing season, which usually begins in February. Experts look at this rise in acreage as a promising bet made by farmers on the oilseed with ample water availability and favorable climate.

Gujarat has estimated over two-fold rise in summer sesame seed crop this year at 24,490 tonnes (as per third advance estimates), which was 11,650 tonnes in the previous year. In Gujarat, Saurashtra dominates summer sesame seed cultivation with sowing area concentrated in the districts of Junagadh, Rajkot and Surendra nagar.

Area, yield rise:

Sesame seed is an export-oriented crop, but it is a very sensitive crop requiring sufficient water and favourable climate. The state-wise production of sesame seeds during the winter season can be detailed as below:

Sesame Winter Crop 2020-21

The State government has projected sesame seed yield at 832 kg/ha, which was 661 kg/ha last year.

Price Trend:

Farmers anticipated a higher yield amid favourable climatic and market conditions. But the export outlook remains uncertain due to the lockdown in India and abroad.

Sesame seed wholesale price averaged ₹11,113 per MT in Gujarat in April 2020, which was lower by about 19 per cent from ₹13,673 averaged for the same month last year. This is attributed to the higher crop outlook and bleak export prospects amid global trade disruptions.

Export & Import Volume:

Sesame Seed exports during April-January, 2019-20 declined to 2,31,941Metric Tons in comparison to 2,64,934Metric Tons during April-January, 2018-19. In value terms, Sesame Seed exports decreased to Rs. 3067.29 crores from Rs. 3097.79 crores.

Imports of Sesame Seed during the period April-January, 2019-20 have been about 1,09,291 metric tons in comparison to 87,538metric tons for full year 2018-19.

During the period of April-June 2020, the total sesame exports from India increased to 68,483.36 tons as against to 66,131.07 tons during April-June 2019. The monetary value of Indian sesame exports has been pruned to Rs. 846.15 crores from 913.58 crores. Import volume for April-June 2020 was estimated at 42650.35 tons in comparison to 55,085.95 tons during April-June 2019.

As Per the Directorate General of Commercial Intelligence and Statistics (DGCIS) data, India exported 3.12 lakh tons of sesame seed worth ₹3,762 crore in 2018-19. For 2019-20 (April-January data), sesame seed exports stood at 2.32 lakh tons worth ₹3,067 crore.

India’s top sesame seed export destinations include the US (15,865 tons), South Korea (16,383 tons), Vietnam (15,389 tons), Russia (11,931 tons) and Netherlands (10,795 tons) for April-January period of 2019-20.

The overall sesame seed output is targeted at 10.17 lakh tons (for kharif season estimate), whereas the Second Advance Estimate released by the Agriculture Ministry in February shows projected sesame seed output at 6.64 lakh tons for the year 2019-20, which may be a tad lower than 6.9 lakh tons for previous year 2018-19.

Impact of COVID19 on Sesame seeds:

Demand from Food Service & tourism segments: The absolute demand from QSR and tourism related segments impacted while demand from Edible Oil segment mounted high than the pre-COVID levels.
Uncertainty in Demand: Sudden lockdowns are inversely impacting the demand forecasts of sesame buyers. Most of them buying hand-to-mouth, are now asking for prompt shipments.
Logistics Congestion: Severe impact on Container availability due to the sudden disparity in Import and Export volumes, are leading to higher lead time for Indian Exporters.
Policy changes: Amid the corona crisis, the Indian govt. has made significant changes in the food processing and distribution policies. With a major focus on dealing with Pandemic and distribution of essential food commodity to the poor, least attention is on trade/exports resulting in slower refunds of Tax and Incentives and leading to liquidity crunch.

Impact of ETO issue:

Suspension of Exports: Indian side has suspended Exports to the EU for want of clarity on testing methods and harmonization of sampling and testing in India and the EU.
Latest update: Continuous dialogue on both sides is expected to resolve the issue in the coming weeks.

Market Forecasts for 2021-2025:

  • The global sesame seed market is projected to grow at a CAGR of 2.2% over the forecast period (2021-2025).
  • Across the world, there is a growing appetite for healthy ingredients in diets among consumers, especially the millennial population across North America and Europe. The nutritional profile of these seeds has gained consumer attraction over the last few years.
  • The growing demand for super foods among health-conscious consumers is driving the demand for the sesame seed market. However, price fluctuations and allergies associated with the commodity are holding back the growth of sesame seeds.
  • The drivers identified in the sesame seed market are consumption patterns and increasing health awareness, increasing demand across nations, and advancements and innovations in terms of hybrids. The restraints identified in the market are international price fluctuations, strong international competition, and salmonella risk in sesame seed.
  • The ongoing COVID-19 pandemic compelled the consumers to rethink their consumption patterns which has led to the growth in demand for healthy ingredients, which has created an opportunity for sesame seeds as ingredients to various food and personal care products. However, the disruptions in trade has created a decline in the initial months of the year. The market is anticipated to grow in the future.
  • Indian sesame seeds crop to surge in the forecasted period.
  • Ascribing to the coronavirus-driven global trade disruptions, the sesame producers are anticipating an uncertain market for an inordinate yield of sesame seeds in India.
  • Cultivation area of the oilseed has risen by three times over the past year. Indian Farmers shall milk the benefits of higher acreage this summer harvesting season.
  • Water availability is good, prices are remunerative for the farmers, so a larger yield is expected in India.
  • Demand driven increase in production of export-worthy sesame varieties is possible.
  • Sesame crop would play a befitting role in doubling India’s share in global export of agricultural commodities.
  • An assured supply of good quality farmers’ stocks would help scale up exports of seeds and also value-added products.

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