Good export buying has aided the cardamom market to remain steady last week without dropping despite slack domestic demand at auctions held in Kerala and Tamil Nadu.
The individual auction average remained below Rs800 a kg, vacillating between Rs725 and Rs785 a kg last week.
However, good export buying helped the market from falling following weak demand from the domestic market. “Nobody in the market was aggressive in buying”, market sources told Business Line. They said exporters were actively covering as the prices prevailing at present were attractive to the overseas buyers. Consequently, more are and more inquiries were pouring in, they claimed.
Slack demand from the upcountry market is attributed to the unfavourable weather conditions prevailing in the north Indian states which is said to have resulted in a fall in retail sales.
Added to this, there is a bearish feeling in the trade, albeit speculative, that as the prices have been on a declining trend, the growers are holding back their produce anticipating rise in prices. Therefore, the trade believe that this material would ultimately come to the market later.
Exporters said to have bought an estimated 40 tonnes of the cardamom and in fact, more buying is likely if the prices remained stable at the current levels, export sources claimed.
At the same time, the supply remained limited as the harvesting of the current crop is almost over, growers said.
Weather conditions continued to remain totally unfavourable so far. According to veterans in the field of cardamom growing region, the plants would withstand the current dry spell till mid Feb. “If summer rains failed to arrive after Feb 15, then the plants would start withering and subsequently would dry up”, they said. “However, there are indications at present that the summer rains may arrive after Feb 15”, they said.
According to market observers 70 per cent of the growers had 50 per cent output while the remaining thirty per cent had 30 to 35 per cent crop this season as the weather has so far been totally unfavourble.
As a result, the current total output is estimated at somewhere between 13,000 tonnes and 15,000 tonnes as against the production last season of 26,000 – 30,000 tonnes, they said.
Total arrivals last week dropped to 320 tonnes from 371 tonnes during the week before last, and of this 302 tonnes were sold, they said.
At the Sunday auction conducted by the KCPMC total arrivals dropped to 59 tonnes from 65 tonnes arrived in the previous Sunday and the entire quantity was sold out. The maximum price was at Rs1,139 a kg and minimum was at Rs486 a kg. Auction average price dropped to Rs764.22 a kg from Rs774.52 a kg the previous Sunday, Mr P C Punnoose, General Manager, CPMC told Business Line.
Total arrivals and sales during the current season from Aug 1, 2012 to Feb 10, 2013 were at 8,042 tonnes and 7,639 tonnes respectively. Total arrivals and sales during the corresponding period last year were about 12,159 tonnes and about 11,844 tonnes respectively.
The weighted average price as on Feb 10, 2013 stood at Rs772.67 a kg as against 558.09 a kg as on the same date last year.
Prices of graded varieties were steady at previous levels and they in Rupees per Kg were: AGEB 900 - 1,000 ; AGB 780 -790 ; AGS 745 – 755 ; and AGS -1 : 720 – 730.