The Hindu Business Line : Cardamom prices continue to slide

LIQUIDATION of carryover stock of last year's crop in large quantities in recent weeks - resulting in an upsurge in arrivals - has led to continuous decline in cardamom prices in the auction centres in Kerala and Tamil Nadu.

Though there is demand from both upcountry buyers and exporters, most of it is being met from the carryover stock and the buying is just to make up for the shortfall.

Traders fear that the prices will fall further in the coming weeks, especially after the Guatemala crop arrival begins early next month.

According to sources in Bodinayakkanur, an average 20-30 tonnes of carryover stock of the previous season arrive in the auction centres every week.

Of about 25 exporters, only a few are actively participating in auctions as buying for others is done by agents.

Wild price fluctuations last year had caused heavy losses to many traders and stockists. In fact, stockists seem to have fled the scene this year. "Nobody wants to buy and stock now because of last year's experience," Mr P.C. Punnoose, General Manager, Cardamom Marketing and Processing Company Ltd (CPMC), Kumily, told Business Line.

On the other hand, several traders could not participate in the auctions due to non-availability of credit facility. However, this facility could be extended to them provided they are able to give some security, he said.

"Unlike in the past, speculation is comparatively at low levels this season. The scenario indicates that the trade is not healthy."

The prices at the CPMC auction in Kumily on Wednesday fell by Rs 10 a kg from that of the weekend. Around 47 tonnes of cardamom were sold.

The price of superior variety 8 mm bold was sold at Rs 580-Rs 590 per kg, while 7 mm sold at Rs 390-Rs 420 and bulk at Rs 320-Rs 330. The average price dropped to Rs 390 per kg from Rs 400 last Saturday.

Exports during the first half of the current fiscal were down by 80-150 tonnes from that of the corresponding previous period, Mr S. Kannan, Director (Marketing), Spices Board, said.

According to him, exports during the current month are expected to be around 50 tonnes and touch 75-100 tonnes in December.

All-India sales during the current season up to November 8 stood at 1,384 tonnes against 1,184 tonnes during the previous season. The weighted average price this season was 407.13 per kg compared to Rs 680 earlier.

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