The Hindu Business Line : Cumin exports top value target for current fiscal

Though the upsurge in cumin prices in the world market has led to a decline in its exports from India, the value realisation from shipments of the commodity during April– Jan 2007-8 has already surpassed, the target set by the Spices Board for the current fiscal.

The total exports of cumin during the first 10 months of the current financial year stood 20,500 tonnes valued at Rs 216.58 crore as against the set target of 25,000 tonnes valued at Rs 212.50 crore.

During the corresponding period last fiscal total shipments were at 22,830 tonnes valued at Rs 174.01 crore.

The unit value has shot up to Rs 105.65 a kg from Rs 76.22 a kg during the first 10 months of last fiscal.

Fall in output in other cumin producing countries, such as Syria, Turkey and Iran in 2007, has created a tight supply position which has pushed up its price in the world market.

This phenomenon on the other hand has paved the way for shipments from the country significantly albeit short of last fiscal figures, despite the upsurge in its price, Spices Board sources told Business Line.

India is the world’s largest producer and consumer of cumin. Besides India, cumin seed is cultivated in Iran, Turkey and in Syria mainly for exports.

The new crop in Syria and Turkey is harvested in August-September; so until then Indian cumin seed finds good market in overseas countries, according to Kodak Commodity Services Limited (KCSL).

It is almost exclusively cultivated in Rajasthan and Gujarat and it is grown as a rabi crop, with sowing starting in October and harvesting in February. The output in both Rajasthan and Gujarat has dropped significantly due to the vagaries of weather and decline in area.

However, the farmers enthused by the better prices in recent months have brought more area under the crop and as a result the production this year is likely to go up substantially. According to KCSL, the area in Gujarat is expected to go up by 10-15 per cent.

Production

Given the increase in area coupled with favourable weather “we expect a higher yield of 480 kg/ ha in 2008 compare to 380 kg/ha in 2007”, they said. Keeping all the fundamental factors in consideration, they said, “we estimate the cumin production to increase by 26 per cent in 2008 to 2,11,200 tonnes compared to 1,67,200 tonnes last year. Opening stock for 2008 is estimated 42,304 tonnes compared to 45,104 tonnes in 2007.

On the other hand, the consumption is estimated to increase by 13 per cent in 2008 at 1.65 lakh tonnes compared to 1.45 lt in 2007.

The demand for cumin has been in the range of 1.8 to 2 lt this year and it is likely to rule firm given the increasing population, stockist buying and significant exports, they said. “We expect the stocks to increase in 2008 to 64,354 tonnes”.

international Scenario

In the international scenario, cumin producing nations such as Turkey, Syria and Iran are having lower stocks. Cumin crop in Turkey will be harvested in July while harvesting in Iran will be in June. Thus, new crop from Turkey and Iran will not be available before mid June.

Besides, area under this crop is expected to be low in Iran and Turkey as farmers have shifted to wheat and barley due to better price realisation. Syria, Iran and Turkey, the major cumin producers, are price drivers in the international market. Though their crop sizes are low compared to India, they export 90 per cent of their production unlike India which consumes 90 per cent of its total cumin output.

According to KCSL, the spot price of cumin is to oscillate in the range of Rs 8,500-10,500 in the short term. Break out of the channel can lead to the upside of Rs 12,500 or the downside of Rs 7,000. Support for the short term is seen at Rs 9,000.