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G.K. Nair

Prices decline by Rs 30 a kg

Kochi , Jan. 8

Declining trend was witnessed in the cardamom prices in auctions held last week in Kerala and Tamil Nadu for want of sufficient buying support. The prices during the week declined by around Rs 30 a kg. Withdrawal of commodity investors from the market has been pointed out as the reason for the declining trend. However, north Indian buyers were active while export buying was not encouraging, market sources in Bodinayakannur told Business Line.

Declining Prices

The arrivals in recent days have shown a downward trend. At the auction on Wednesday at Kumily, conducted by the Cardamom Processing and Marketing Company (CPMC), arrivals stood at 55 tonnes and almost the entire quantity was sold out. The upward trend that was prevailing till Saturday disappeared, thereafter. However, the average price maintained at above Rs 300 a kg, Mr P.C. Punnoose, General Manager, CPMC, said. As the prices started declining the investors appear to have withdrawn from the auctions.

Rumours that cardamom from Guatemala might start arriving this month have also contributed to the drop in prices, he said.

At the Wednesday auction in Kumily, 8 mm bold has fetched Rs 420- 440 while other grades such as 7.5 mm at Rs 370-390, 7 mm at Rs 325-345 and current bulk at Rs 310-325 a kg.

Active Exporters

While in Bodinayakannur, 8 mm bold was being sold at an average price of Rs 370 a kg and 7.5 mm at Rs 300-310. Sick variety was fetching Rs 200-250 a kg. According to trading sources, the exporters were not much active because of the upward swing in the prices in recent weeks.

The shipments in November last was a meagre 25 tonnes valued at Rs 1.01 crore.The exports during April-November 2006 fell to 335 tonnes valued at Rs 10.66 crore.One of the main reasons pointed out by the trade is the decline in demand from Japan, which used to import good quantity of 6-7 mm green (AGS variety), they said.

Summer Showers

The drop in arrivals is attributed to the dry weather prevailing in the growing areas. According to growers, these regions were receiving one or two showers every month during the past couple of years and even in the winter months.

But, this year so far, there weren't any such rains and as a result the area is experiencing a dry spell, which would negatively affect the crop in the coming weeks, they claimed.

But, there could be improvement in the crop if there were good summer showers in the growing areas in the coming months, failing which it is likely that the production would be much less than predicted earlier, they claimed.

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