Higher prices may prompt more farmers to sow jeera

Higher prices and strong export demand are likely to prompt farmers to cultivate more cumin seed (jeera) this year, leading to an increase in its acreage.

Experts see cumin seed acreage increasing by about 8-10 per cent in Gujarat and the bordering districts of Rajasthan in 2017-18, following attractive prices that the seed spice fetched farmers last year. These two states together account for 80-85 per cent of the production of the spice.

Jeera prices hovered higher at around ₹19,620 per quintal during the peak demand period, in August. Trade sources maintained that prices gained on strong domestic demand and export demand.

Estimates indicated jeera production for 2016-17 at around 4.85 lakh tonnes with the area under jeera at 7.60 lakh hectares.

Sowing for the new crop is likely to begin from the first week of November and experts see more farmers taking up jeera cultivation in anticipation of higher prices.

“Sowing is likely to increase this time mainly because the seed spice fetched attractive prices of around ₹19,000 per quintal during much of last year. In anticipation of higher prices, more farmers may take up jeera cultivation this year. We see most of the switch happening from mustard growers,” Ajay Kedia of Mumbai-based Kedia Commodities told BusinessLine .

According to Kedia, due to lower realisations for the mustard crop, farmers may shift to jeera cultivation. “This will add to the jeera acreage. But uncertain weather worries remain for the jeera crop and there are fears of an extended winter and moisture conditions affecting the quality of jeera seeds,” Kedia said, adding that jeera prices may remain under pressure temporarily on the back of increased acreage.

Uncertain climatic conditions may push prices up around the new crop arrival.

India, which produces about 70 per cent of the world’s cumin seed, is expected to be the key source for cumin supplies across the world as Syria and Turkey — the other two major jeera producers — are not likely to contribute much to global supply.

“There is demand from China and Bangladesh. Also, we expect demand to firm up as supplies from Syria, Turkey and Iran remain subdued. We expect a rally in prices before the new crop arrives,” said Vijay Joshi, a leading jeera trader in Unjha.

Market sources expect prices to touch ₹21,000 per quintal before the new crop arrivals begin in March owing to limited stocks and an empty supply pipeline.

On the National Commodity & Derivatives Exchange Ltd, jeera futures remained under pressure at ₹18,550 for the November contract, while spot prices at the Unjha market hovered over the ₹18,895 mark.