The Hindu Business Line : Domestic demand, high price continue to mar spices export

THE downward trend continues in export of spices from the country with the decling touching Rs 280 crore during April - January of the current fiscal. Given the situation, total exports during the current fiscal are certain to remain far below the target of Rs 1,900 crore.

Total shipments during the period stood at 1,82,580 tonnes valued at Rs 1,490.25 crore as against 2,26,379 tonnes worth Rs 1,770.46 crore in the corresponding period last financial year, a drop of 43,799 tonnes in volume and Rs 280.21 crore in terms of value, sources at the Spices Board told Business Line.

Except for celery, garlic, nutmeg and mace, vanilla and other spices, exports of all the other items, including value-added products such as spice oils and oleoresins, curry powder and mint products witnessed a significant decline. Spice oils and oleoresins dropped from 4,044 tonnes valued at Rs 320.20 crore to 3,600 tonnes worth Rs 288.64 crore, mint products declined from 11,730 tonnes valued at Rs 494.67 crore from 9,250 tonnes valued at Rs 348.93 crore and curry powder from 7,095 tonnes valued at Rs 56.99 crore to 6,150 tonnes valued at Rs 51.22 crore.

However, the new entrant vanilla has shown a substantial increase both in volume and value. As against 15.3 tonnes valued at Rs 12.64 crore in April - January 2002-03, 20.1 tonnes valued at Rs 24.36 crore were exported in April- January 2003-04.

There had been a substantial drop in the case of chilli from 69,478 tonnes to 54,000 tonnes, ginger from 7,587 tonnes to 3,600 tonnes, cumin from 9,528 tonnes to 5,600 tonnes, fenugreek from 12,356 tonnes to 5,800 tonnes, other seeds from 11,492 tonnes to 6,300 tonnes. Whereas the increase in three items except vanilla and garlic has been marginal, the sources pointed out.

The trend in pepper indicates that the country is losing its premier position as the major exporter of the black gold with the exports dropping continuously in recent years. Its exports during April - January 2003-04 stood at 14,400 tonnes, which included re-export of imported pepper, valued at Rs 124.87 crore. Pepper exports, which had touched its peak with 47,893 tonnes in 1996-97 and 35,719 tonnes in 1997-98, continued to drop thereafter to the present levels. The highest ever value realisation was of Rs 487.41 crore in 1997-98, where as at present it is below Rs 150 crore.

Substantial growth in domestic demand without having a corresponding growth in production has not only squeezed the exportable surplus but also raised the price, making it uncompetitive in the world market. At the same time, new competitors such as Vietnam have also entered the global market with competitive prices. Vietnam is set to increase its pepper production to over one lakh tonne with over 80 per cent of it available for export at prices much below that of India. Besides, Madagascar, Thailand and China are also slowly entering the world pepper market.

In the case of other spices, too, the situation is not different because of non-availability and higher prices. "If you want to achieve a sustained growth in exports there should be availability of the spices in required quality and at competitive prices," Mr Ramkumar Menon, Chairman, All-India Spices Exporters Forum, told this correspondent.

The current situation is such that there is no exportable surplus in the case of many items because of the huge domestic market where the growers are getting remunerative prices. Except for few items such as celery seeds and turmeric, most of the other items are either at short supply or unavailable. When cumin, clove, cinnamon etc. are unavailable availability of items like pepper and coriander are inadequate. This not only results in increased raw material price but also to a great extent impedes the export growth.

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