The Hindu Business Line : Cardamom prices lose flavour on heavy arrivals, low demand

A bumper crop coupled with decline in direct sales has pushed up the arrival at the auction centres. During October 7 to 12, the arrivals stood at 321 tonnes, probably the highest ever, market sources told Business Line.

North Indian buyers, after having bought enough quantity, have slowed down their activity, while the exporters probably for want of orders are not active. Except for one major exporter others did not buy any substantial quantity.

Earlier in the week the prices dropped sharply by Rs 50 but rose by Rs 20 on Wednesday at Kumily auction.

The downward trend has also dissuaded traders to buy on the fear that it might fall further. Those who bought at higher prices in previous weeks were delaying payments and it had also adversely affected the trade, they pointed out.

The demand during the Ramzan month from the Gulf markets failed to pick up as anticipated. In the overseas markets, the carryover stock was said to be available to meet the demand there, export sources said.

However, the devastating impact of the hurricane Stan in Guatemala, where 30 per cent of all crops reported to have been destroyed, might push up the demand from foreign markets, they said.

The harvesting of cardamom in Guatemala, a major producer, is to begin in late November and early December. The drop in production there coupled with the possible delay in transportation due to destruction of communication facilities in Guatemala is likely to result in short supply in the world market, they claimed.

However, enquiries have yet to emanate from these markets. Surprisingly, despite the prices being at lower levels for the good quality cardamom the exporters were not buying, they said.

The arrivals during the current season up to October 11 stood at 2,417 tonne as against 1,102 tonne in the same period last year. A total of 2,269 tonne were sold through auctions as against 1,043 tonne last season. The weighted average price was Rs 236.78 a Kg compared to Rs 323.94 a Kg in the corresponding period last season.

Prices of graded varieties as on October 8 were AGEB Rs 330-340, AGB Rs 230-240, AGS Rs 200-220 and AGS 1 Rs 200-210 a Kg.

The prices in Bodinayakannur on October 13 were AGEB Rs 320-330, AGB Rs 220-225, AGS Rs 200-210 and AGS 1 Rs 180-190 a Kg.

Prices of 8mm bold dropped to Rs 415-420 a Kg on Wednesday at Kumily from Rs 484 a Kg two weeks ago while 7.5 mm bold was sold at Rs 295-300 a kg. Thus the bold coloured varieties were fetching Rs 50-60 less in recent days, Mr P C Punnoose, General Manager, Cardamom Processing and Marketing Company (CPMC) said.

According to him if the prices were to remain remunerative given the surge in production, of late, the domestic consumption has to be raised, he said. The favourable weather conditions prevailing all these months would lead to a good late crop also, he added.

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