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Poppy seeds continue to zoom up in the domestic market, of late to Rs 375-410 a kg as the supply remained far below the demand following crop failure and reduction in areas under the crop in most of the growing countries.
Turkey crop
“Indian production is already exhausted while the crop in Turkey, the major producer and supplier to India is reportedly below 50 per cent of its normal output,” upcountry trade sources told Business Line .
If the current trend is any indication, prices may scale new heights, they said.
In India, demand from Bengal is huge and it has aided the price rise during the past couple of days, they said.
Market sources said the inventories held by many are thin. “Hence, buyers want delivery but physical cargo availability is reportedly very tight as the crop, apart from Turkey, in other origins such as China, Czech, Spain has also failed”, the trade said.
Due to halving of the area under the crop in Turkey this year coupled with the unfavourable weather, the “total crop would amount to between 8,000 and 10,000 tonnes, of which 5,000-7,000 tonnes would be white poppy seeds.
In 2011, Turkey produced an estimated 35,500 tonnes of poppy seeds comprising 30,000 tonnes of white, 3,500 tonnes blue and 2,000 tonnes yellow, a Public Ledger report said.
India is the major consumer of Turkish poppy seeds and, hence, the Indian demand has a significant influence on the commodity’s price.
India consumes 40,000 tonnes of poppy seeds every year and against this, the indigenous production is around 12,000 tonnes. The balance is met by imports mainly from Turkey, they said.
Availability, according to current estimates, will be around 50 per cent of the normal global output, upcountry trade sources said. “The next crop will come only in July 2013 and, hence, there is going to be a long gap till the arrival of the next crop”, they pointed out.
This year’s crop in all the producing countries is reportedly very low due to damages inflicted by cold weather and reduction in growing areas. Consequently prices have increased by 150 per cent in last three months, they added.
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