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I know that I should probably sell 95% of the loot that drops, but I really don't want to sell something that could be important for later in the game.

What loot is related to side quests or the main story line?

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I think this should have all the information you need. From that faq, these are the items that are suggested you not sell:

  • Bhujerban Madhu (can be sold for 250, but the related sidequest nets you 1000 each)
  • Black Orb (actually okay to sell, but only worth 1 gil each)
  • Centurio Hero's Badge
  • Dewdrop Pebble (no opportunity to sell these, actually)
  • Great Serpentskin
  • Jaya Stick
  • Nebralim
  • Pinewood Chop (classified as loot, but actually can't be sold)
  • Sandalwood Chop (same as Pinewood Chop)
  • Semclam Shell
  • Small Package
  • Teleport Stone (keep at least 10 at a time)
  • Valeblossom Dew

As I recall, the great serpentskin was the only thing that wasn't immediately obvious that I might not want to sell it. In any case, even if you do sell it you don't miss out on anything permanently.

I don't recall any loot being necessary for the main storyline other than the pinewood and sandalwood chops, but as I noted you can't sell those anyway.

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    You beat me to it, was just about to link the same FAQ. It's a great resource for item management in a game where item management isn't exactly great... One thing to note, from that faq: When a recipe is complete and you buy the unlocked Bazaar Goods the quantity for the loot used in that recipe is set back to 0, even if you sold more than required. If items you sell are used in multiple bazaar recipes, DO NOT buy the first item it unlocks until you unlock the other recipes with that sold item, else you will be 'wasting' more of that item for that other recipe unlock.
    – king14nyr
    May 6, 2016 at 17:44

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