The Hindu Business Line : Cardamom above Rs 600 on tight supply

The continuous squeeze in arrivals has kept the individual average price for cardamom at auctions held in Kerala and Tamil Nadu above Rs 600 a kg during the past few weeks.

Anticipating a technical correction, given the stable high prices, the dealers are said to be buying cautiously, market sources told Business Line. However, they are of the view that the demand may go up after the Republic Day when the tight security along the borders with the neighbouring countries is relaxed. “Border trade would resume after this event pushing up the demand,” they said.

Drop in arrivals

They said the arrivals during the current season so far has dropped by around 50 per cent when compared to the last season. The current combined arrivals at all the auctions were at around 100 tonnes a week against 200-225 tonnes a week during the corresponding period last season, they pointed out.

The monthly requirement is estimated at 500 tonnes a month and, thus, the total demand till the beginning of the next season i.e., July, would come to 3,000 tonnes. As against this, the availability would be around 2,000 tonnes leaving a shortage of around 1,000 tonnes, they claimed. Given this situation the prices are likely to remain at higher level this year, they said.

Arrivals at the STCL auction at Bodinayakannur on Thursday stood at 25 tonnes, and, of which, 1.5 tonnes of the commodity was withdrawn. The maximum price was at Rs 701 a kg, while the minimum was Rs 351 a kg. Individual average price was at Rs 639.10 a kg.

At the Cardamom Processing and Marketing Company (CPMC)’s auction on Wednesday 28 tonnes of cardamom arrived, and, of which, 1.5 tonnes was withdrawn. The maximum price was Rs 704.50 and the minimum Rs 517.50. The individual average price stood at Rs 640.21. At this auction, 8mm was fetching Rs 750-775, while 7.5mm-8mm was being sold at Rs 700-725 a kg. Current bulk was fetching Rs 640-675 a kg.

The situation has reached a stage that even capsules of inferior quality and size are fetching above Rs 500 a kg. Export buying was of negligible quantity for want of overseas buyers at the prevailing higher prices, said Mr P.C. Punnoose, General Manager, CPMC.

Total arrivals during the current season up to January 23 stood at 3,334 tonnes. The weighted average price went up to Rs 469.05 a kg from Rs 295.34 a kg as on January 23.

Prices of graded varieties were AGEB Rs 745-755, AGB Rs 685-695, AGS Rs 665-675 and AGS 1 Rs 635-645 a kg.

Prices in the local market at Bodinayakannur were AGEB Rs 730-740, AGB Rs 670-680, AGS Rs 650-660 and AGS 1 Rs 620-630 a kg.

The growing areas have not received any rains so far in January.