Guatemala takes flavour off cardamom exports

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G.K. Nair

Kochi, April 26

STIFF competition from Guatemala in the world cardamom market has pushed down the Indian exports substantially.

India, which used to export over 2,000 tonnes of cardamom (small) even when the total production of the commodity in the country was in the range of 3,000-4,700 tonnes, could export only around 600 tonnes last fiscal as against 690 tonnes the year before.

In 1964-65, the country exported 1,503 tonnes valued at Rs 2.72 crore when the unit value was Rs 18.08 a kg. In the seventies and eighties, the exports ranged between 1,500 tonnes and 3,300 tonnes except in 1976-77 and 1983-84 when the exports were 893 tonnes and 258 tonnes respectively due to poor crop.

The highest-ever export was in 1985-86 with 3,272 tonnes valued at Rs 53.46 crore and at a unit value of Rs 163.39 a kg, when the production touched 4,700 tonnes. Domestic production remained above 10,000 tonnes from 2000-01 onwards. The domestic consumption had also gone up substantially. But, still there has been a good exportable surplus, as the internal market could not absorb the entire production, market sources told Business Line. The increased availability from internal production and imports have depressed the domestic prices also, they said.

Ever since the entry of Guatemala in the world market from late 1980s, Indian exports have shrunk to a range of 270-690 tonnes in 2003-04, except for 2000-01 and 2001-02 when the exports stood at 1,545 tonnes and 1,031 tonnes respectively because the poor crop in Guatemala.

In recent years, the production in Guatemala has gone up to 16,000-18,000 tonnes and according to reliable sources, it is expected to be around 24,000 tonnes in 2004. There is virtually no domestic consumption in that country and, hence, the entire crop is available for exports. Increased supply to the country's traditional markets in Saudi Arabia and other countries, such as Japan, UK etc. at low prices, India has started losing these markets.

The un-competitive price is attributed to the decline in exports. In terms of quality, Indian cardamom is superior.

Hence, the quality-conscious traditional customers in these markets still prefer Indian cardamom at the premium price. However, pushing up the exports of this commodity now seems possible only through value-added products, they added.

(This article was published in the Business Line print edition dated April 27, 2005)
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