The cardamom market continued to remain steady last week on good demand for the ensuing festival and marriage seasons, at auctions held in Kerala and Tamil Nadu.

Total arrivals during the week dropped to about 505 tonnes from around 520 tonnes the previous week. The decline in arrivals was caused by auction holiday on Wednesday at CPMC (Cardamom Processing & Marketing Co-Operative) on account of Mahanavami, trade sources said.

Last week, exporters were also active and are estimated to have bought around 70 tonnes, they said.

Upcountry dealers were also seen covering actively and it gives the impression that whatever material they bought earlier have been sold out, market observers pointed out.

Good demand

According to them, there is good demand, of late, from the domestic market, indicating a substantial growth in consumption of this aromatic commodity in the country. Probably, economic growth and consequent changes in food habits coupled with a switchover to fast foods seem to have raised the per capita consumption of cardamom.

Add to this there may be cross-border trade with the neighbouring countries. Also, exports to non-traditional markets might have boosted the demand.

In the first half of this year (April-September 2011), cardamom sales through auctions were at a record 8,642 tonnes This works out to the total annual sales in the past 3-4 years.

Expanding market

It clearly indicates that the market has grown enough to absorb such a huge quantity, which has became available this year from a rise in production.

Total sales during April-September 2009 and 2010 were at 3,670 tonnes and 3,172 tonnes, respectively. But the figures in the first half of the current fiscal were more than double this, they said.

Arrivals at the Sunday auction held by the KCPMC stood at 107.5 tonnes and the entire quantity was sold out. The maximum price was Rs 934.5/kg and the minimum, Rs 365/kg. The average was Rs 594.33 a kg, Mr P. C. Punnoose, General Manager, CPMC, told Business Line .

Weather effect

He said the weather has changed significantly and the growing areas have been experiencing high temperature during the day in the past fortnight. If it prevailed, there could be a squeeze in arrivals in the coming days, he said.

Total arrivals during the current season up to October 9 stood at 4,365 tonnes as against 1,925 tonnes in the same period the previous season.

Sales during the period were at 4,262 tonnes and 1,890 tonnes respectively. The weighted average price as on October 1, 2011, was Rs 601 a kg while that on the same day last year was Rs 1,208 a kg.

“A matching demand and supply situation continued to exist and that has kept the market steady last week and indications are that it may be firm in the coming days because of the dry spell in the growing areas,” Mr Ranganathan, a Bodi-based dealer told Business Line .

Open market price

Prices in the open market remained unchanged on Monday. At Kumily, the prices per kg were: AGEB Rs 750-800; AGB Rs 660-680; AGS Rs 660-670 and AGS Rs 630-640. At Bodinayakanuur, they were: AGEB (7-8 mm), Rs 730-760; AGB (6-7 mm), Rs 640-675; AGS (5-6 mm), Rs 630-660; and AGS 1, Rs 590-620. Eight mm bold was fetching Rs 950-975 a kg, the trade sources said. Good bulk was being sold at Rs 640-680 a kg in Bodinayakannur.

The high temperature in the growing areas for the past two weeks might affect the crop, but it may not have any significant impact on the overall crop output, the trade said.

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