• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• BL Club
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

G. K. Nair

Kochi, Nov 20 If the latest trend in the pace of growth in value-added spices exports such as curry powder/paste and spices oils and oleoresins is any indication, the shipments of bulk spices would face a gradual decline in the coming years, restricting it to certain spices only.

In the total exports during April –October 2008 of 2,84,560 tonnes valued at Rs 3,080.25 crore, the contribution of spices oils and oleoresins including mint products stood at 41 per cent. Exports of spices oils and oleoresins increased to 4,610 tonnes valued at Rs 463.85 crore from 3,815 tonnes valued at Rs 320.44 crore in April– October 2007. The unit value has shot up to Rs 1,006.18 a kg from Rs 839.93 last year. This increase could be partly attributed to the sharp fall in the value of rupee against the dollar. Shipments of curry powder/paste have also gone up to 8,500 tonnes valued at Rs97.14 crore from 6,400 tonnes worth Rs 61.90 crore. In this case also the unit value has increased to Rs 114.29 a kg from Rs96.72 a kg.

Senior Spices Board sources told Business Line on Thursday that end-users in major overseas markets had built up a small channel for direct sourcing and it is getting stronger, of late. “Once this channel is opened up fully exports of value-added products will multiply several fold,” they claimed. The end users find direct sourcing more competitive in terms of price on the one hand and with out any uncertainty in the supply on the other. There appears to be a gradual squeeze in the supply by the favouring houses overseas which are, at present, the major supplier of such items because of higher cost of production and uncertainty over availability of raw materials.

On the impact of the current economic recession, they said the credit squeeze overseas following the financial turmoil world over has been felt in the exports of spices also. In October last, shipments of spices dropped to 28,070 tonnes valued at Rs 402.99 crore as against 32,494 tonnes valued at Rs 370.96 crores in October 2007. The rise in exports should have gone up by 50 per cent but for the current financial crisis. But, still there has been a significant growth, they said. The main problems currently faced by exporters are reconfirmation by banks and the increase in ECGC premium by 20 per cent. Even, according to unconfirmed reports, some of the consignments shipped out by over confident exporters are lying in ports for want of clearance, they said.

The cumulative exports during April-October 2008 is estimated as 2,84,560 tonnes valued Rs 3080.25 crores ($710.62 million) as against 2,66,325 tonnes valued Rs 2700.50 crores ($664.41 million) in the corresponding period of the last financial year. Compared to last year, the export has shown an increase of 7 per cent in terms of quantity and 14 per cent in rupee value (In dollar terms, the increase is 7 per cent). Chilli contributed 21 per cent followed by cumin 9 per cent, pepper 8 per cent and turmeric 5 per cent.

During the first seven months this year, exports of most of the major spices have shown an increasing trend in quantity and value compared with the same period a year ago. However, export of pepper and mint products had declined both in terms of quantity and value as compared to last year, while export of ginger and nutmeg declined in quantity. Pepper shipments this year stood at 14,750 tonnes valued at Rs 246.70 crores as against 22,800 tonnes valued Rs 330.38 crores. The average unit value has gone up from Rs 144.90 a kg in 2007 to Rs 167.25 a kg. The low inventory in the major markets due to the economic recession is reported to be the major reason for the decline in exports.

During the period, 1,21,500 tonnes of chilli and chilli products were exported valued Rs 660.18 crores as against 1,21,420 tonnes valued Rs 658.58 crores of last year. The traditional buyers of Indian chilli viz. Malaysia, Indonesia and Sri Lanka continued buying this year also. In addition to this, Pakistan was also very active in the market during the beginning of the year. The reported lower output from other producing countries and mandatory quality testing of chilli and chilli products by the Board have also helped India to achieve this higher level of export in chilli.

The export of seed spices had also shown an increasing trend both the quantity and value as compared to the last year. The export of coriander seed during April-October 2008 has been 17,100 tonnes valued Rs 116.80 crores as against 15,180 tonnes valued Rs 59.95 crores of last year. The unit value of export has gone up from Rs 39.49/kg in 2007 to Rs 68.30/kg in 2008. The export of cumin seed during April-October 2008 has also increased significantly to 26,000 tonnes valued Rs269.98 crores from 14,985 tonnes valued Rs157.93 crores. The reported crop failure in other major producing countries viz. Syria, Turkey and Iran has pushed up the exports of this commodity.

Against the export target of 425,000 tonnes valued Rs 4,350 crores ($1025 million) for the year, the achievement of 2,84,560 tonnes valued Rs 3080.25 crores ($710.62 million) up to October 2008 is 67 per cent in quantity, 71 per cent in rupee value and 69 per cent in dollar terms, they said.

More Stories on : Spices & Condiments | Exports & Imports

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line