The Hindu Business Line : Cardamom prices crash

Kochi, March 17 The cardamom market crashed on selling pressure and weak demand and as a result the average price has declined by over Rs 250 a kg during the past one month at auctions held in Kerala and Tamil Nadu. The decline in the average price during the last week was around Rs 150 a kg.

The individual average price on Monday at the CPA auction in Bodinayakannur dropped to Rs 378.08 a kg. Total arrival stood at 7.1 tonnes and of which 5.2 tonnes was sold. The maximum price was Rs 530 a kg, while the minimum Rs 275.50.

Arrivals rise

The arrivals during last week showed an upward trend. At the auction on Sunday by the KCPMC, it stood at 33.7 tonnes. The growers and traders, who were holding stock, were slowly dumping it in the market and at the same time there were no corresponding increase in demand, Mr P C Punnoose, General Manager, KCPMC, told Business Line.

He said the maximum price on Sunday was Rs 585 a kg, while the minimum Rs 150. Bulk was being sold at Rs 420–425. The individual average price was Rs 433 a kg.

The continuous rainfall during the past few days has created a sentiment in the market that it would pave the way for an early crop next season and in that case those who are holding the produce may not be able to sell the old stock. This phenomenon has forced many to go on a selling spree and that in turn pushed the prices down.

Upcountry dealers, who are holding stocks, started liquidating as the prices continued its sharp decline. Major buyers have withdrawn from the market. Only some are buying to meet their immediate requirements. Besides, the liquidity crunch in the market following the crash in the stock market also negatively affected the commodity market. All these factors have given rise to a squeeze in demand.

At present, dealers in the country are holding an estimated 1,000 tonnes, while an equal quantity is with the growers. Direct sales during the current season are estimated at Rs 1,600 tonnes.

Total arrivals at the auctions as on March 16 stood at 4,116 tonnes against 6,586 tonnes in the corresponding date last year. Similarly, sales were at 3,830 tonnes against 6,057 tonnes in the same period the previous season. Weighted average price stood at Rs 488.80 a kg against Rs 303.53.

The prices of graded varieties as on March 15 were AGEB Rs 555–565, AGB Rs 485–495, AGS Rs 460–470 and AGS1 Rs 440-450. The prices at the local market in Bodinayakannur were AGEB Rs 535–555, AGB Rs 470–480, AGS Rs 440–450 and AGS1 Rs 420–430. Bulk was being sold at Rs 500–550 a kg.

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