Cumin (jeera) prices have rebounded by about 10 per cent since the beginning of this month on demand re-emerging and lower ending stocks.
At the Unjha agricultural produce marketing committee (APMC) yard, a price setter in the spice, in Gujarat, cumin was quoted at ₹31,000 a quintal, up from ₹28,350 on February 2.
On the National Commodities and Derivatives Exchange (NCDEX), cumin for delivery in April opened higher at ₹32,205 a quintal on Monday against the weekend closing of ₹31,900 before surging to ₹33,010. It last traded at ₹32,700.
According to Geojit Commodity, dips in cumin to ₹31,250-30,800 is not ruled out, but the sentiments will strengthen if it rises directly above ₹32,100.
Down from peak at start of the year
At the start of the year, cumin prices had topped ₹33,000 before declining on reports of the crop being higher at 4.14 lakh tonnes (lt) this year compared with 3.88 lt last year.
At the International Spices Conference in Chennai last month, a report prepared by ITC Ltd pegged cumin production, which dropped 20 per cent last season to 3.88 lt, higher at 4.18 lt. It projected a rise in global production to 4.35 lt from 4.08 lt in view of higher Indian production.
Biplab Sarma, Senior Research Analyst, Agriwatch, told businessline that cumin production this year could be some 5 per cent lower than last year as the crop was affected by adverse weather conditions, mainly rain in November.
High moisture in arrivals
Prices were down as the moisture of the new arrivals was higher between 15 per cent and 22 per cent. “In Unjha, the daily arrival was 4,000-6,000 bags daily but buyers are not active in view of high moisture,” he said.
Demand was expected to rise once the moisture of arrivals drop. “Cumin exports were lower by 22.77 per cent last year at 1.89 lt as high prices affected shipments,” Sarma said.
One factor for the spice’s outlook being bullish is that the ending stocks were lower, he said.
Boost from low stocks
ITC Ltd projected a higher production in view of the area under cumin increasing by 4.6 per cent, mainly in Rajasthan where it increased by 13 per cent. In Gujarat, the acreage dropped 10 per cent this year.
As a result, net supplies from India are projected 7 per cent lower which would drive prices higher, the report said.
Sarma said lower ending stocks will boost prices further