For a commodity that was really hot at the beginning of this month, chilli has turned cold with advancing monsoon. Profit-booking in the futures market has also added to the price crash by over 10 per cent.
From around Rs 4,200 a quintal in the spot market, prices are down to Rs 3,900. On Thursday, prices surged again but that has been attributed to lower arrivals. Will farmers hold back their produce to get higher prices? It is something that has to be watched out for.
Rain in growing areas of Andhra Pradesh leading to increase in the water storage level of reservoirs has been the dampener. Earlier, the market had moved up only on poor storage levels.
On the National Commodity and Derivatives Exchange, chilli for October delivery dropped by Rs 118 to Rs 5,512. Similarly, the spice for delivery in November traded lower by Rs 156 at Rs 5,742 a quintal.
Chilli arrivals in Guntur are estimated at 50,000 bags (1 bag - 45 kg) on Thursday, unchanged from Wednesday’s level.